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Lucid Motors Announces Third Quarter 2023 Financial Results

07 November 2023
  • Lucid reported Q3 revenue of $137.8 million driven by customer deliveries of 1,457 vehicles in the quarter
  • Production of the Lucid Air Pure RWD began in September and is in the process of ramping up; production of the Lucid Air Sapphire also began in September, thus completing the Lucid Air lineup
  • General assembly production shifted to Phase 2 of Lucid's factory in Arizona; Lucid opened its first manufacturing plant in Saudi Arabia
  • Lucid closed the Aston Martin transaction and commenced the strategic technology arrangement
  • Lucid appoints Marc Winterhoff as its first-ever Chief Operating Officer, overseeing daily operations and execution across global manufacturing, supply chain, sales and service, marketing, and international markets
  • Lucid Gravity, the company's all new luxury electric SUV, will be unveiled on November 16 at the LA Auto Show; start of production remains on track for late 2024
  • Production outlook for 2023 is revised to 8,000 – 8,500 vehicles from prior guidance of more than 10,000 to prudently align with deliveries

NEWARK, Calif., Nov. 7, 2023 /PRNewswire/ -- Lucid Group, Inc. (NASDAQ: LCID), setting new standards for luxury electric experience with the Lucid Air, winner of the 2023 World Luxury Car Award, today announced financial results for its third quarter ended September 30, 2023. The earnings presentation is available on its investor relations website (https://ir.lucidmotors.com).

Lucid reported Q3 revenue of $137.8 million on deliveries of 1,457 vehicles and produced 1,550 vehicles. The company is also adjusting its production outlook for 2023 to 8,000 – 8,500 vehicles to prudently align with deliveries.

"We delivered on our commitments to complete the Lucid Air lineup on time with Pure RWD and Sapphire, transition general assembly to our Phase 2 factory in Arizona, and open our first plant in Saudi Arabia. We recognize we still have work to do on our customer journey and deliveries," said Peter Rawlinson, Lucid's CEO & CTO. "Next week, we look forward to the world premiere of the Lucid Gravity, our amazing vehicle that will redefine the electric SUV. Gravity remains on track to begin production in late 2024."

"We are seeing results from our targeted marketing approach, as the majority of new demand came from customers who had their first contact with Lucid in the quarter," said Sherry House, Lucid's CFO. "We've also made progress with the cost control program we implemented in the first half of the year and have identified further opportunities for 2024. We ended the third quarter with approximately $5.45 billion in liquidity, which we expect to lead us to our next major milestone, Gravity production, and beyond, into 2025."

Lucid will host a conference call for analysts and investors at 2:30 P.M. PT / 5:30 P.M. ET on November 7, 2023. The live webcast of the conference call will be available on the Investor Relations website at ir.lucidmotors.com. Following the completion of the call, a replay will be available on the same website. Lucid uses its ir.lucidmotors.com website as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

About Lucid Group

Lucid's mission is to inspire the adoption of sustainable energy by creating advanced technologies and the most captivating luxury electric vehicles centered around the human experience. The company's first car, the Air, is a state-of-the-art luxury sedan with a California-inspired design. Lucid Air Grand Touring features an official EPA estimated 516 miles of range. Assembled at Lucid's factories in Casa Grande, Arizona, and King Abdullah Economic City (KAEC), Saudi Arabia, deliveries of Lucid Air are currently underway to customers in the U.S., Canada, Europe, and the Middle East.

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Trademarks

This communication contains trademarks, service marks, trade names and copyrights of Lucid Group, Inc. and its subsidiaries and other companies, which are the property of their respective owners.

Forward Looking Statements

This communication includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "shall," "expect," "anticipate," "believe," "seek," "target," "continue," "could," "may," "might," "possible," "potential," "predict" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding financial and operating outlook and guidance, future capital expenditures and other operating expenses, ability to control costs, expectations and timing related to commercial product launches, including the Gravity SUV, production and delivery volumes, expectations regarding market opportunities and demand for Lucid's products, the range and performance of Lucid's vehicles, plans and expectations regarding the Gravity SUV, including performance, driving range, features, specifications, and Gravity's potential impact on markets, plans and expectations regarding Lucid's software, plans and expectations regarding Lucid's systems approach to the design of the vehicle, plans and expectations regarding Lucid's integration with NACS, including timing and benefits, estimate of the length of time Lucid's existing cash, cash equivalents and investments will be sufficient to fund planned operations, plans and expectations regarding its future capital raises and funding strategy, the timing of vehicle deliveries, future manufacturing capabilities and facilities, studio and service center openings, ability to mitigate supply chain and logistics risks, plans regarding the Phase 2 expansion of Lucid's AMP-1 factory, including timing, installed capacity and potential benefits, ability to vertically integrate production processes, future sales channels and strategies, future market launches and international expansion, including plans and expectations for the AMP-2 manufacturing facility in Saudi Arabia, and plans and expectations regarding the purchase agreement with the government of Saudi Arabia, including the total number of vehicles that may be purchased under the agreement, expected order quantities, and the quantity and timing of vehicle deliveries, Lucid's ability to grow its brand awareness, the potential success of Lucid's direct-to-consumer sales strategy and future vehicle programs, plans and expectations of the Lucid Referral Program in the United States, potential automotive partnerships, including plans and expectations regarding Lucid's strategic technology arrangement with Aston Martin, and the promise of Lucid's technology. These statements are based on various assumptions, whether or not identified in this communication, and on the current expectations of Lucid's management. These forward-looking statements are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and may differ from these forward-looking statements. Many actual events and circumstances are beyond the control of Lucid. These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions, including government closures of banks and liquidity concerns at other financial institutions, a potential global economic recession or other downturn and global conflicts or other geopolitical events; risks related to changes in overall demand for Lucid's products and services and cancellation of reservations and orders for Lucid's vehicles; risks related to prices and availability of commodities, Lucid's supply chain, logistics, inventory management and quality control, and Lucid's ability to complete the tooling of its manufacturing facilities over time and scale production of the Lucid Air and other vehicles; risks related to the uncertainty of Lucid's projected financial information; risks related to the timing of expected business milestones and commercial product launches; risks related to the expansion of Lucid's manufacturing facility, the construction of new manufacturing facilities and the increase of Lucid's production capacity; Lucid's ability to manage expenses and control costs; risks related to future market adoption of Lucid's offerings; the effects of competition and the pace and depth of electric vehicle adoption generally on Lucid's future business; changes in regulatory requirements, governmental incentives and fuel and energy prices; Lucid's ability to rapidly innovate; Lucid's ability to enter into or maintain partnerships with original equipment manufacturers, vendors and technology providers; Lucid's ability to effectively manage its growth and recruit and retain key employees, including its chief executive officer and executive team; risks related to potential vehicle recalls; Lucid's ability to establish and expand its brand and capture additional market share, and the risks associated with negative press or reputational harm; Lucid's ability to effectively utilize zero emission vehicle credits and obtain and utilize certain tax and other incentives; Lucid's ability to issue equity or equity-linked securities in the future; Lucid's ability to pay interest and principal on its indebtedness; future changes to vehicle specifications which may impact performance, pricing and other expectations; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; risks associated with the restructuring plan, including the risk that the charges and expenditures may be greater than anticipated, the risk that the restructuring plan may adversely affect Lucid's internal programs and initiatives and its ability to recruit and retain skilled and motivated personnel, the risk that the restructuring plan may be distracting to employees and management, the risk that the restructuring plan may negatively impact Lucid's business operations, reputation, or ability to serve customers, and the risk that the restructuring plan may not generate their intended benefits to the extent or as quickly as anticipated; and the impact of the global COVID-19 pandemic on Lucid's supply chain, projected results of operations, financial performance or other financial metrics, or on any of the foregoing risks; and those factors discussed under the heading "Risk Factors" in Part II, Item 1A of Lucid's Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, as well as other documents Lucid has filed or will file with the Securities and Exchange Commission. If any of these risks materialize or Lucid's assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Lucid currently does not know or that Lucid currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Lucid's expectations, plans or forecasts of future events and views as of the date of this communication. Lucid anticipates that subsequent events and developments will cause Lucid's assessments to change. However, while Lucid may elect to update these forward-looking statements at some point in the future, Lucid specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Lucid's assessments as of any date subsequent to the date of this communication. Accordingly, undue reliance should not be placed upon the forward-looking statements.

Non-GAAP Financial Measures and Key Business Metrics

Condensed consolidated financial information has been presented in accordance with US GAAP ("GAAP") as well as on a non-GAAP basis to supplement our condensed consolidated financial results. Lucid's non-GAAP financial measures include Adjusted EBITDA and Free Cash Flow which are discussed below.

Adjusted EBITDA is defined as net loss before (1) interest expense, (2) interest income, (3) provision for income taxes, (4) depreciation and amortization, (5) change in fair value of common stock warrant liability, (6) stock-based compensation and (7) restructuring charges. Lucid believes that Adjusted EBITDA provides useful information to Lucid's management and investors about Lucid's financial performance. Free Cash Flow is defined as net cash used in operating activities less capital expenditures. Lucid believes that Free Cash Flow provides useful information to Lucid's management and investors about the amount of cash generated by the business after necessary capital expenditures.

These non-GAAP financial measures facilitate management's internal comparisons to Lucid's historical performance. Management believes that it is useful to supplement its GAAP financial statements with this non-GAAP information because management uses such information internally for its operating, budgeting, and financial planning purposes. Management also believes that presentation of the non-GAAP financial measures provides useful information to Lucid's investors regarding measures of our financial condition and results of operations that Lucid uses to run the business and therefore allows investors to better understand Lucid's performance. However, these non-GAAP financial and key performance measures have limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP.

Non-GAAP information is not prepared under a comprehensive set of accounting rules and therefore, should only be read in conjunction with financial information reported under GAAP when understanding Lucid's operating performance. In addition, other companies, including companies in Lucid's industry, may calculate non-GAAP financial measures and key performance measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of Lucid's non-GAAP financial measures and key performance measures as tools for comparison. A reconciliation between GAAP and non-GAAP financial information is presented below.

LUCID GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share and per share data)

 
  

September 30,
2023

 

December 31,
2022

ASSETS

    

Current assets:

    

Cash and cash equivalents

 

$         1,164,391

 

$      1,735,765

Short-term investments

 

3,258,206

 

2,177,231

Accounts receivable, net

 

23,370

 

19,542

Inventory

 

798,974

 

834,401

Prepaid expenses

 

76,368

 

63,548

Other current assets

 

70,185

 

81,541

Total current assets

 

5,391,494

 

4,912,028

Property, plant and equipment, net

 

2,673,057

 

2,166,776

Right-of-use assets

 

221,657

 

215,160

Long-term investments

 

479,727

 

529,974

Other noncurrent assets

 

175,299

 

55,300

TOTAL ASSETS

 

$         8,941,234

 

$      7,879,238

     

LIABILITIES

    

Current liabilities:

    

Accounts payable

 

$            104,602

 

$         229,084

Accrued compensation

 

61,542

 

63,322

Finance lease liabilities, current portion

 

8,964

 

10,586

Other current liabilities

 

862,752

 

634,567

Total current liabilities

 

1,037,860

 

937,559

Finance lease liabilities, net of current portion

 

77,019

 

81,336

Common stock warrant liability

 

78,943

 

140,590

Long-term debt

 

1,995,673

 

1,991,840

Other long-term liabilities

 

345,724

 

378,212

Total liabilities

 

3,535,219

 

3,529,537

     

STOCKHOLDERS' EQUITY

    

Common stock, par value $0.0001; 15,000,000,000 shares authorized as of September 30, 2023 and

  December 31, 2022; 2,290,134,335 and 1,830,172,561 shares issued and 2,289,276,510 and

  1,829,314,736 shares outstanding as of September 30, 2023 and December 31, 2022, respectively

 

229

 

183

Additional paid-in capital

 

14,981,851

 

11,752,138

Treasury stock, at cost, 857,825 shares at September 30, 2023 and December 31, 2022

 

(20,716)

 

(20,716)

Accumulated other comprehensive loss

 

(10,363)

 

(11,572)

Accumulated deficit

 

(9,544,986)

 

(7,370,332)

Total stockholders' equity

 

5,406,015

 

4,349,701

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$         8,941,234

 

$      7,879,238

LUCID GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(in thousands, except share and per share data)

 
 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

2023

 

2022

 

2023

 

2022

Revenue

$         137,814

 

$         195,457

 

$         438,120

 

$         350,468

        

Costs and expenses

       

Cost of revenue

469,722

 

492,483

 

1,526,051

 

1,030,795

Research and development

230,758

 

213,761

 

694,035

 

600,218

Selling, general and administrative

189,691

 

176,736

 

556,209

 

563,707

Restructuring charges

518

 

 

24,546

 

Total cost and expenses

890,689

 

882,980

 

2,800,841

 

2,194,720

        

Loss from operations

(752,875)

 

(687,523)

 

(2,362,721)

 

(1,844,252)

        

Other income (expense), net

       

Change in fair value of common stock warrant liability

60,316

 

140,146

 

61,647

 

998,319

Interest income

66,064

 

24,373

 

145,594

 

27,284

Interest expense

(3,340)

 

(7,613)

 

(17,138)

 

(22,521)

Other income (expense), net

(763)

 

665

 

(1,024)

 

9,898

Total other income, net

122,277

 

157,571

 

189,079

 

1,012,980

Loss before provision for income taxes

(630,598)

 

(529,952)

 

(2,173,642)

 

(831,272)

Provision for income taxes

296

 

149

 

1,012

 

540

Net loss

(630,894)

 

(530,101)

 

(2,174,654)

 

(831,812)

Net loss attributable to common stockholders, basic

(630,894)

 

(530,101)

 

(2,174,654)

 

(831,812)

Change in fair value of dilutive warrants

 

(140,146)

 

 

(998,319)

Net loss attributable to common stockholders, diluted

$        (630,894)

 

$        (670,247)

 

$     (2,174,654)

 

$     (1,830,131)

        

Weighted average shares outstanding attributable to common stockholders

       

 Basic

2,284,446,783

 

1,676,048,504

 

2,010,916,100

 

1,666,693,217

 Diluted

2,284,446,783

 

1,690,963,548

 

2,010,916,100

 

1,686,576,589

        

Net loss per share attributable to common stockholders

       

 Basic

$              (0.28)

 

$              (0.32)

 

$              (1.08)

 

$              (0.50)

 Diluted

$              (0.28)

 

$              (0.40)

 

$              (1.08)

 

$              (1.09)

        

Other comprehensive income (loss)

       

Net unrealized gains (losses) on investments, net of tax

$              1,554

 

$          (12,575)

 

$              2,590

 

$          (13,266)

Foreign currency translation adjustments

(1,967)

 

 

(1,381)

 

Total other comprehensive income (loss)

(413)

 

(12,575)

 

1,209

 

(13,266)

Comprehensive loss attributable to common stockholders

$        (631,307)

 

$        (542,676)

 

$     (2,173,445)

 

$        (845,078)

LUCID GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

 
 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

2023

 

2022

 

2023

 

2022

Cash flows from operating activities:

       

Net loss

$    (630,894)

 

$    (530,101)

 

$ (2,174,654)

 

$    (831,812)

Adjustments to reconcile net loss to net cash used in operating activities:

       

Depreciation and amortization

60,832

 

50,653

 

166,033

 

131,343

Amortization of insurance premium

9,114

 

10,264

 

30,242

 

25,188

Non-cash operating lease cost

6,593

 

5,302

 

18,871

 

14,254

Stock-based compensation

68,237

 

83,302

 

193,432

 

352,245

Inventory and firm purchase commitments write-downs

230,816

 

186,496

 

734,495

 

364,553

Change in fair value of common stock warrant liability

(60,316)

 

(140,146)

 

(61,647)

 

(998,319)

Other non-cash items

(19,286)

 

(7,424)

 

(46,990)

 

(5,020)

Changes in operating assets and liabilities:

       

Accounts receivable

(2,800)

 

(1,119)

 

(3,778)

 

489

Inventory

(127,971)

 

(302,202)

 

(575,933)

 

(906,054)

Prepaid expenses

(12,027)

 

(18,560)

 

(43,062)

 

(12,101)

Other current assets

(4,808)

 

(1,063)

 

13,680

 

(33,262)

Other noncurrent assets

(4,032)

 

(11,526)

 

(113,790)

 

(39,082)

Accounts payable

(18,811)

 

2,620

 

(114,810)

 

52,216

Accrued compensation

(7,460)

 

(6,542)

 

(1,781)

 

16,644

Operating lease liabilities

(5,788)

 

(3,817)

 

(17,500)

 

(10,761)

Other current liabilities

(625)

 

102,001

 

(44,005)

 

281,545

Other long-term liabilities

5,644

 

12,396

 

25,993

 

20,191

Net cash used in operating activities

(513,582)

 

(569,466)

 

(2,015,204)

 

(1,577,743)

Cash flows from investing activities:

       

Purchases of property, plant and equipment

(192,517)

 

(290,064)

 

(638,002)

 

(784,964)

Purchases of investments

(1,438,001)

 

(1,307,454)

 

(3,585,254)

 

(2,726,677)

Proceeds from maturities of investments

498,081

 

125,353

 

2,480,570

 

125,353

Proceeds from sale of investments

 

 

148,388

 

Proceeds from government grant

 

97,267

 

 

97,267

Other investing activities

 

 

(4,827)

 

Net cash used in investing activities

(1,132,437)

 

(1,374,898)

 

(1,599,125)

 

(3,289,021)

Cash flows from financing activities:

       

Proceeds from issuance of common stock under Underwriting Agreement, net of issuance costs

 

 

1,184,224

 

Proceeds from issuance of common stock under 2023 Subscription Agreement, net of issuance costs

 

 

1,812,641

 

Payment for short-term insurance financing note

 

 

 

(15,330)

Payment for finance lease liabilities

(1,455)

 

(1,204)

 

(4,534)

 

(3,605)

Proceeds from borrowings

38,654

 

13,565

 

42,920

 

20,228

Repayments for borrowings

 

(6,653)

 

 

(6,653)

Proceeds from failed sale-leaseback transaction

 

31,700

 

 

31,700

Proceeds from exercise of stock options

2,214

 

1,889

 

7,321

 

14,738

Proceeds from employee stock purchase plan

 

 

15,089

 

12,882

Tax withholding payments for net settlement of employee awards

(4,327)

 

(21,654)

 

(14,705)

 

(212,895)

Payment for credit facility issuance costs

 

 

 

(6,631)

Net cash provided by (used in) financing activities

35,086

 

17,643

 

3,042,956

 

(165,566)

Net decrease in cash, cash equivalents, and restricted cash

(1,610,933)

 

(1,926,721)

 

(571,373)

 

(5,032,330)

Beginning cash, cash equivalents, and restricted cash

2,776,880

 

3,192,411

 

1,737,320

 

6,298,020

Ending cash, cash equivalents, and restricted cash

$   1,165,947

 

$   1,265,690

 

$   1,165,947

 

$   1,265,690

LUCID GROUP, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(in thousands)

 

Adjusted EBITDA

 
 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

2023

 

2022

 

2023

 

2022

Net loss (GAAP)

$   (630,894)

 

$   (530,101)

 

$  (2,174,654)

 

$   (831,812)

Interest expense

3,340

 

7,613

 

17,138

 

22,521

Interest income

(66,064)

 

(24,373)

 

(145,594)

 

(27,284)

Provision for income taxes

296

 

149

 

1,012

 

540

Depreciation and amortization

60,832

 

50,653

 

166,033

 

131,343

Change in fair value of common stock warrant liability

(60,316)

 

(140,146)

 

(61,647)

 

(998,319)

Stock-based compensation

68,237

 

83,302

 

194,875

 

352,245

Restructuring charges

518

 

 

24,546

 

Adjusted EBITDA (non-GAAP)

$   (624,051)

 

$   (552,903)

 

$  (1,978,291)

 

$  (1,350,766)

 

Free Cash Flow

 
 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

2023

 

2022

 

2023

 

2022

Net cash used in operating activities (GAAP)

$   (513,582)

 

$   (569,466)

 

$  (2,015,204)

 

$  (1,577,743)

Capital expenditures

(192,517)

 

(290,064)

 

(638,002)

 

(784,964)

Free cash flow (non-GAAP)

$   (706,099)

 

$   (859,530)

 

$  (2,653,206)

 

$  (2,362,707)

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