TLDR
- Lucid completed 1-for-10 reverse stock split Friday to boost institutional appeal
- Company holds $3.6 billion cash plus $1.3 billion credit through 2026
- 2025 production target set at 18,000-20,000 vehicles including new Gravity SUV
- Uber partnership brings $300 million investment for luxury robotaxi development
- Stock trades at 5x sales versus Tesla’s 12x multiple
Lucid Group executed its 1-for-10 reverse stock split after Friday’s market close. The move consolidates every 10 existing shares into one new share at ten times the original price.
The electric vehicle manufacturer’s board pushed for the split to attract institutional investors. Many large funds avoid low-priced stocks due to internal investment policies.
Trading around $2 before the split, Lucid faced no immediate delisting threats. The company wanted to stay well above penny stock levels to maintain broad investor access.
Strong Financial Position Despite Losses
Lucid reported $3.6 billion in cash at Q2 2024 end. The company also maintains $1.3 billion in available credit facilities.
This financial cushion extends operations through 2026 according to management. The timeline provides space to execute growth plans without funding pressure.
Recent partnerships have strengthened the balance sheet. Uber Technologies invested $300 million for luxury robotaxi development, adding capital for production scaling.
Saudi Arabia’s Public Investment Fund owns over 60% of shares. This backing provides strategic support and potential future funding access.
Production Targets and Market Performance
Lucid delivered 10,241 vehicles in 2024, missing earlier projections. Original targets called for 90,000 deliveries but supply chain issues created delays.
The company targets 18,000-20,000 vehicle deliveries in 2025. Growth will come from Air sedan sales plus new Gravity SUV production.
Manufacturing expansion continues at Arizona’s AMP-1 facility. A new Saudi Arabia AMP-2 plant supports international growth plans.
Revenue jumped 36% to $808 million in 2024. However, net losses widened from $2.8 billion to $3.1 billion year-over-year.
The company loses roughly $299,000 per vehicle at current production levels. Scaling production should improve these unit economics over time.
Analysts project 61% revenue growth to $1.3 billion in 2025. Further expansion to $2.5 billion is forecast for 2026 with new model launches.
Lucid trades at 5 times projected 2025 sales with its $6.4 billion market cap. Tesla commands a 12x sales multiple, suggesting potential upside if execution improves.
The reverse split becomes effective when markets reopen Tuesday. Share prices should adjust to ten times Friday’s closing level automatically.
Investors holding shares Friday don’t need to take action. Brokerage accounts will reflect the new share count and pricing when trading resumes.
