TLDR
- Lucid announced it will proceed with a 1-for-10 reverse stock split, effective September 2, 2025
- Stockholders approved the reverse stock split amendment at a special meeting on August 18, 2025
- Stock closed at $2.03 on Friday, down from Thursday’s $2.09 close
- Company is on track to sell about 17,000 cars this year, generating $1.3 billion in sales
- Shares have fallen 31% year-to-date and 42% over the past 12 months
Lucid Group announced Thursday it will move forward with a 1-for-10 reverse stock split. The electric vehicle maker’s shares will begin trading at the adjusted price on September 2.
The stock closed at $2.09 on Thursday before dropping to $2.03 on Friday. This represents a 2.9% decline despite a broader market rally.
Stockholders approved the reverse stock split amendment during a special meeting held on August 18. The amendment gives the Board of Directors authority to execute the split.
Reverse stock splits typically aim to boost share prices by reducing the number of outstanding shares. Each 10 shares will become one share at 10 times the price.
The move comes as Lucid struggles with declining investor confidence. Shares hit a record high of $58.05 in February 2021.
Wall Street was much more optimistic about EV startups back then. Analysts projected 2025 sales of roughly $15 billion from about 100,000 vehicle deliveries.
Reality Check for EV Market
The reality has proven different for Lucid and other EV manufacturers. The company expects to sell approximately 17,000 cars this year.
Revenue projections now stand at $1.3 billion for 2025. This falls far short of earlier Wall Street expectations.
Electric vehicles currently represent 7% to 8% of new car sales in the US. This trails Europe by half and China by three-quarters.
Competition has intensified across the EV landscape. In 2021, only nine EV models sold more than 10,000 vehicles in the US.
By 2024, that number jumped to more than 30 models achieving similar sales volumes. The increased competition has pressured margins and market share.
Stock Performance Pressures
Lucid shares have declined 31% year-to-date through Thursday’s trading session. Over the past 12 months, the stock has dropped 42%.
The company trades at a current market capitalization of $6.54 billion. Average daily trading volume reaches 139.7 million shares.
Analysts maintain a Hold rating on the stock with a $2.50 price target. Technical indicators currently show a Sell signal.
The reverse split won’t immediately change Lucid’s fundamental business challenges. The company continues to face operational inefficiencies and negative gross margins.
TipRanks’ AI analyst Spark rates LCID as Neutral. The rating reflects ongoing financial challenges and valuation concerns.
Strategic partnerships and vehicle production growth provide some positive elements. However, persistent losses and high leverage overshadow these developments.
The automotive industry transformation continues to present both opportunities and obstacles. Lucid focuses on luxury electric vehicles in the high-end market segment.
Manufacturing scale remains a key challenge for the company. Production volumes need to increase substantially to achieve profitability targets.
The reverse stock split becomes effective September 2, when shares will trade at the new consolidated price.
