Finance
Lucide shares fall after Q1 loss, confirms Gravity SUV on track for launch ‘late 2024’
EV maker Lucid ( LCID ) reported mixed first-quarter results as a wider-than-expected loss outweighed the company’s confirmation that its Gravity SUV is still on track for a 2024 debut.
For the quarter, Lucid reported revenue of $172.7 million, ahead of expectations of $150.1 million and up nearly 16% from a year ago. However, Lucid’s loss per share came in at $0.30, higher than estimates of $0.25, while its adjusted EBITDA loss came in at $598.4 million, compared to the $505.1 million forecast by analysts on Bloomberg .
“Our sales momentum is increasing, our focus on costs remains relentless and we believe Gravity is on track to become the best SUV in the world,” Lucid CEO Peter Rawlinson said in a statement. Lucid confirmed that the production start of the Gravity SUV would take place “in late 2024”, and that the upcoming mid-size car would be launched in late 2026.
Lucid shares fell more than 8% in after-hours trading.
Last month, Lucid announced that it produced 1,728 vehicles and delivered 1,967 vehicles in the first quarter, up from 2,391 produced and 1,734 vehicles delivered in the fourth quarter. The ever-increasing delivery numbers were positive news for investors, and the company said it is targeting 9,000 vehicles produced by 2024. Last year, Lucid produced 8,428 vehicles and delivered 6,001 to customers.
Lucid’s latest round of EV price cuts announced in February likely boosted sales, but there were concerns it would impact the company’s margins – which Lucid isn’t officially disclosing.
“If you look at the first quarter, despite the pricing actions we took in the current quarter, our gross margin improved sequentially and that was a result of cost optimization initiatives that the company took, and technology plays a critical role – battery costs, do you know, [have] come on down,” Lucid interim CFO Gagan Dhingra told Yahoo Finance in a phone call shortly after Lucid’s earnings release.
Dhingra also noted that the company was working with suppliers to reduce bill of materials (BOM) costs and logistics costs to improve margins.
Another area of concern for investors is the capital expenditures for the Gravity production operations. Lucid said capital expenditures in the quarter were $198.2 million, with expenditures expected to reach $1.5 billion in 2024.
Rawlinson was optimistic that these costs would pay off for Lucid. ‘I am very optimistic about that [Gravity] is going to give us great scale, and a lot of the cost structure isn’t about the bill of materials itself – it’s about the economies of scale in terms of amortizing those damn fixed costs, and what we need is volume and I believe gravity is that is. it’s going to give us volume,” Rawlinson told Yahoo Finance.
In terms of its cash position, Lucid said it had $4.62 billion in cash and cash equivalents on hand, enough liquidity to last through the second quarter of 2025. Lucid announced in late March that it had entered into a financing agreement with its majority shareholder Ayar Third Investment Company. for an investment of $1 billion. Ayar is a subsidiary of the Saudi Public Investment Fund (PIF).
“We are a cornerstone of [Saudi Arabia’s 2030] vision, we are mutually encouraged to succeed,” Rawlinson said of Lucid’s deep ties with Saudi Arabia’s PIF sovereign wealth fund. “PIF wants us to succeed, this is not just a normal financial investment. But why do they trust us? Because what sets us apart is that we have the highest technology in the world in the field of space.”
Pras Subramanian is a reporter for Yahoo Finance. You can follow him Tweet and further Instagram.
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