Lucid CEO Peter Rawlinson Sees Sales Slowing Down Later This Year Because... Consumers Will Go On Vacation: 'I Always Offer Caveats'
Portfolio Pulse from Anan Ashraf
Lucid Group (NASDAQ:LCID) anticipates a sales decline in the next two quarters despite a nearly 40% increase in first-quarter deliveries to 1,967 vehicles. CEO Peter Rawlinson attributes the expected slowdown to seasonal factors, including vacations and a slowdown in Saudi Arabia, where over 25% of Lucid's sales occur. The Saudi Public Investment Fund (PIF), a major investor in Lucid, has contributed $6.4 billion since 2018 and agreed to purchase up to 100,000 vehicles over ten years. Despite a Q1 loss of $680.9 million, Lucid raised $1 billion from a PIF affiliate, boosting its liquidity to $5.03 billion. Lucid's stock saw a 9.5% increase before dropping 7.9% after hours.
May 07, 2024 | 6:41 am
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Lucid Group anticipates a sales decline in the upcoming quarters due to seasonal factors, despite a strong first quarter. The company's significant financial backing from Saudi Arabia's PIF and a recent $1 billion raise may cushion the impact.
The expected sales decline in the next two quarters directly impacts Lucid's short-term financial outlook and stock performance. The significant role of the Saudi PIF as an investor and the recent capital raise may provide some financial stability, but the anticipated slowdown in sales, especially given the unusual reason of vacation seasons affecting demand, is likely to negatively affect investor sentiment and the stock price in the short term.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100