Lucid Group
shareholders have endured a lot lately. The company’s first- quarter earnings report highlighted a new problem—pricing—rather than offering relief.
Monday evening, Lucid (ticker: LCID) reported a loss of 43 cents a share from $149 million in sales. Wall Street was expecting the maker of high-end electric cars would lose 39 cents a share from sales of $204 million.
Lucid delivered 1,406 vehicles in the first quarter, so the average revenue per delivery came in at about $106,000. In the fourth quarter, that figure was about $133,000. That indicates that pricing has come down faster than Wall Street analysts projected. Analysts’ consensus projection for revenue worked out to about $145,000 per vehicle.
Prices for many EVs have been falling since the start of the year because
Tesla
(TSLA), the biggest producer, has cut prices several times in an apparent grab for market share. That includes their most expensive vehicles, which compete with the Lucid Air.
Along with sales, management’s forecast about production might be making investors nervous. “We are on track to produce over 10,000 vehicles in 2023,” said CEO Peter Rawlinson in the company’s news release.
When Lucid reported fourth-quarter figures in February, management told investors to expect 2023 production of 10,000 to 14,000 vehicles, but the latest forecast didn’t include a figure for the top end of the range. Wall Street had projected annual production of roughly 20,000 to 22,000 in February.
The fourth-quarter results showed 28,000 vehicle reservations, down from 34,000 when Lucid reported its third-quarter 2022 numbers. There is no reservation number in the Monday news release.
Lucid shares were down 8.7% in after hours trading after slipping 0.2% in regular trading. The
Nasdaq Composite
rose 0.2%, while the S&P 500 was flat.
Along with demand, cash is a significant issue for start-up EV companies. Lucid ended 2022 with about $4.4 billion in cash and $4.9 billion in liquidity when debt facilities were included.
At the end of the first quarter, the company had about $3.4 billion in cash and $4.1 billion in total liquidity.
The company used about $1 billion in cash in the first quarter. That is a lot, given that Wall Street expects the company to use about $3 billion and $2.1 billion in 2023 and 2024, respectively.
Lucid used about $3.9 billion building its business in 2022. Wall Street doesn’t expect positive free cash flow until 2026.
That cash balance and cash-burn rate mean capital will be needed at some point in the future. When Lucid might sell stock to raise funds is up to management and the market.
Management scheduled a conference call for 5:30 p.m. Eastern time to discuss the results and the outlook for the balance of the year.
Demand and production issues have weighed on investor sentiment, while rising interest rates and a slowing economy have weighed on car stocks in general. Lucid stock is down about 58% over the past 12 months, while
General Motors
(GM) stock has fallen about 15%. The S&P 500 is flat over the same span.
Write to Al Root at [email protected]
Read the full article here
