To The Moon

$Lucid Group Inc(LCID)$ is scheduled to release its fourth-quarter 2024 earnings result on 25 Feb 2025 after the market closes.

The consensus estimate for the fourth quarter is anticipated at a loss of 25 cents earnings per share with a revenues expected to come in at $225.5 million. 

Lucid (LCID) Last Positive Earnings Give Investors A 37.84% Significant Change

Lucid gave a positive earnings call on 07 Nov 2024 which have investors seen a 37.84% change to the share price.

The earnings call highlighted significant achievements in vehicle deliveries and capital raising, alongside strong safety ratings and the launch of new products.

However, it also addressed challenges related to high operating expenses, substantial net losses, and cost management issues.

Lucid (LCID) Guidance On Lucid Gravity SUV Production And Sales Forecast For 2025

During the Lucid Group's Q3 2024 earnings call, the company provided several key metrics and guidance for its future performance. Lucid achieved record deliveries of 2,781 vehicles, marking a 91% increase year-over-year and a 16% sequential increase, and they produced 1,805 vehicles in the quarter. Revenue reached approximately $200 million, up 45.2% year-over-year. The company reaffirmed its guidance to produce approximately 9,000 vehicles for the full year 2024. Lucid raised $1.75 billion in capital, providing financial runway well into 2026. The company plans to strategically expand its footprint, with 55 studio and service centers and 72 mobile service vans as of the third quarter.

Additionally, Lucid reduced its 2024 CapEx guidance to approximately $1 billion from $1.3 billion, reflecting savings and deferrals into 2025. The upcoming Lucid Gravity SUV is expected to drive future growth, with production scheduled to start in late 2024.

Key Metrics To Watch For Lucid (LCID) Q4 2024 Earnings

Production & Deliveries

• Quarterly Deliveries: Lucid Group delivered 2,781 vehicles in Q3 2024, marking an approximately 91% year-over-year increase and a 16% sequential increase, outperforming typical seasonal industry trends.

  Investors received a breath of fresh air in 2024 as the company finally achieved explosive sales growth.

• Production Ramp: Lucid ended the year with a bang, delivering 3,099 vehicles during the fourth quarter, which marked the fourth consecutive quarter with record EV deliveries. It ended the year with 10,241 total deliveries, which was up 70% from the prior year. This show that the production bottleneck might have already been addressed.

• Inventory Levels: In the third quarter, inventory levels were flat sequentially, with a notable impairment charge of $154.9 million, reflecting ongoing challenges in managing production costs. But from the deliveries in Q4, lucid looked like it has managed to clear quite a significant number in its inventory, but we will need to note if the production costs have been able to reduce.

Financial Health

• Revenue: In Q3, Lucid reported a GAAP net loss per share of $0.41 and a non-GAAP net loss per share of $0.28, with an adjusted EBITDA loss of $613.1 million.

• Gross Margin: In Q3, GAAP gross margin improved by 28 percentage points sequentially, driven by cost reduction initiatives.

• Operating Expenses: R&D expenses increased by 13% sequentially to $324.4 million, and SG&A expenses increased by 11% to $233.6 million, primarily due to higher stock-based compensation.

• Net Loss: In Q4, there is expectations of a smaller losses, this could signal progress toward profitability.

We need to take note of the successful capital raise in Q3, where lucid raised approximately $1.75 billion through a public offering and an investment by the Public Investment Fund, providing sufficient financial runway into 2026.

And to improve the sales and deliveries of Lucid vehicles, the achievement of Lucid Air Safety Ratings where lucid Air earned the highest possible overall safety rating of 5 stars from both the National Highway Traffic Safety Administration and the European New Car Assessment Program.

And the interest upon the launch of Lucid Gravity which Lucid opened orders for the Lucid Gravity SUV, with significant interest and increased foot traffic in showrooms by more than 70%. This is the number we should be watching as well.

Lucid (LCID) Price Target

Based on 7 Wall Street analysts offering 12 month price targets for Lucid Group in the last 3 months. The average price target is $2.93 with a high forecast of $5.00 and a low forecast of $1.00. The average price target represents a -4.25% change from the last price of $3.06.

If we could see a significant pre-orders for the Lucid Gravity SUV and the increase in deliveries in Q4 comes with a reduction in Lucid production cost, we could be seeing another positive earnings calls, which could help to gather another 25-20% uptrend move in Lucid share price.

I think I might planned to take a small position but will see how the market react to Lucid share price trading today (24 Feb).

Technical Analysis - Exponential Moving Average (EMA) - Lucid (LCID)

We are seeing a downtrend experienced by LCID where the RSI is falling towards the oversold, which mean a weak momentum, and we can see that the share price is currently below the 12-EMA which intersect with the 200-period, this mean that market is still wary of whether Lucid could deliver on their new model and wonder how the pre-orders and sales would look like.

We need LCID to show us more conviction in terms of investors buying interest and the bulls pushing to regain the space above the 12-EMA, though it is defending the 26-EMA, this is not enough for an uptrend especially before an earnings call.

I would be expecting some trading to happen for LCID as investors might find value in this stock, one more note is Lucid Air Sedan does not qualify for the tax credit when the consumer purchase, so if there is a cut to this tax credit, the impact might be minimal.

Summary

I think the production cost and the cash reserves would be something that investors would assess if liquidity is sufficient to fund operations.

Also Lucid need to show that their quarterly cash burn must slow as they scale their production. Lucid have raise capital but the dilution risk (new shares) or debt raises to fund operations could spook investors.

Declining reservations could signal weakening demand. Lucid stopped reporting reservations in 2023, so any transparency here would be notable.

Updates on the Gravity SUV and mid-size EV line (planned for 2026). Pre-orders for new models could boost sentiment. Lucid previously targeted 90,000 annual vehicles by 2024/2025. Any downward revision would hurt confidence.

Appreciate if you could share your thoughts in the comment section whether you think Lucid would be able to overcome cost while it scale production and annual vehicle sold in 2024 have been met?

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.