Lucid raised $1 billion through a private placement of convertible preferred stock to an affiliate of the Public Investment Fund (PIF).
Produced 1,728 Lucid Air vehicles and delivered 1,967 in Q1 2024, marking the company’s best quarter for deliveries with a 39.9% year-over-year increase.
Lucid aims to produce approximately 9,000 vehicles in 2024, consistent with previous guidance.
Brand awareness and pricing improved, with a reduction in media spend from Q4.
Lucid Air named the best luxury electric car for the third consecutive year by U.S. and World Report.
The upcoming Gravity SUV is expected to expand Lucid’s total addressable market significantly.
Q1 2024 revenue was $172.7 million, up 9.9% sequentially, driven by higher deliveries.
Q1 gross margin improved quarter-over-quarter due to cost optimization initiatives.
Q1 operating expenses included $284.6 million in R&D and $213.2 million in SG&A.
Lucid ended Q1 with approximately $4.6 billion in cash, cash equivalents, and investments, with total liquidity of approximately $5.03 billion.
Capital expenditures in Q1 were $198.2 million, down from $272.6 million in Q4.
Lucid forecasts 2024 capital expenditures to be approximately $1.5 billion, focusing on future growth initiatives and expansions.
Lucid’s partnership with the PIF supports the company’s alignment with Saudi Vision 2030 goals.
The company’s cost advantage and in-house technology set it apart from competitors.
Lucid’s efficiency and technology are central to its strategy for reducing production costs and achieving positive gross margins.
The company is in talks with legacy automakers to provide battery or motor technologies, aiming to impact the environment positively and share its technological advancements.
Despite challenges, Lucid is optimistic about achieving scale and improving its financial metrics, including gross margins, through cost optimization and strategic growth initiatives.
Lucid anticipates some seasonal slowing in sales in Saudi Arabia in Q2 and globally in Q3.
The company remains focused on executing its strategy, optimizing costs, and expanding its market reach with upcoming vehicle launches.
Lucid addressed questions from retail investors and analysts, focusing on the pathway to profitability, measures to improve stock price, partnerships with legacy automakers, and plans to compete with Tesla with more affordable car options.
Do you agree with the comparison to Tesla’s Model 3 launch and reaching escape velocity with the Gravity? Will you have the funding to reach that point?
The company has not provided guidance on delivery numbers exceeding production but emphasizes prudent steps to balance production with deliveries to avoid excessive inventory and tie-up of working capital.
The company has been actively working on cost reduction, including BOM costs, and is continuously bringing down costs through technology and logistics optimization.
With Gravity’s production approaching, the company expects further improvements in variable and fixed costs due to increased scale and operating leverage.
Can you quantify the possible development of deliveries to Saudi Arabia and the agreement’s progression? What are the potential funding sources for the next capital raise?
The company delivered over 500 units to Saudi Arabia in Q1 and sees strong demand in the region, particularly for the SUV.
While not providing specific guidance on future splits, the company is confident in the market potential in Saudi Arabia.
Lucid will take an opportunistic view of raising capital when needed, acknowledging the strong support from the PIF but not specifying the source of future funding.
Will the increased vertical integration through Phase II expansion of AMP-1 lead to increased losses in the near term, and will it decrease variable margins for Air and Gravity?
While Phase II activities and Gravity component purchases may impact gross margins in the second half of the year, the company expects significant improvements in margins as it scales and reaches its capacity.
The company is focusing on improving contribution margins trim by trim and expects better margins with scale due to the amortization of fixed costs by suppliers.
Can you comment on the 5% sequential increase in underlying costs per unit delivered in Q1, excluding the impairment charge, and the impact of pricing actions and cost reduction activities?
Has there been an increasing number of bottlenecks in finalizing deals for third-party hardware and software sales, and how does this impact liquidity?
How should everyone think about cash burn through next year, considering the implied step-up from previous commentary, and what is the cadence of CapEx necessary for the midsized model launch?
Cash burn is influenced by capital investment, with significant spending on expanding AMP-1 in Arizona and building AMP-2 in Saudi Arabia, with continued capital expenditure expected in the next year.
The company has not provided specific guidance on cash burn through next year but highlights the capital-intensive nature of its growth trajectory.
Have you considered providing more detail or teaser pictures of the midsized model earlier to generate interest and potentially open reservations to increase liquidity?
The company believes in transparency and providing a realistic view of the product before opening reservations, as opposed to taking reservations far in advance.
The company will open a waiting list for the Gravity when it feels confident in releasing more specific details about the trim and specifications of the vehicle, ensuring transparency and avoiding an environment of opacity.
