Lucid gets $1.5 billion investment as losses mount

EV startup Lucid beat revenue estimates for the second quarter as it received another $1.5 billion commitment from Saudi Arabia’s Public Investment Fund (PIF).

Big picture: Lucid lost $643 million in Q2, slightly better than in Q1, bringing its year-to-date losses to roughly $1.33 billion. Despite this, the company still had some encouraging news to offer shareholders.

• Revenue beat Wall Street estimates by about $8 million, reaching $200.6 million by the end of Q2.

• The company set its second quarterly sales record of the year, delivering 2,394 units. That’s up 22% from the previous high of 1,967 units in Q1.

• Lucid reaffirmed its production target of 9,000 units, noting that manufacturing accelerated in Q2.

Driving the news: With its new investment, Lucid’s majority stakeholder now owns over 60% of the company. While its earnings-per-share results still disappointed investors (26 cents vs 29 cents), the new cash influx helped push its share price up 10% on Monday. Here are more details on the new funds:

• The investment was made by an affiliate of the PIF, who split the funds between $750 million in stock and a $750 million delayed draw term loan facility.

• With $4.28 billion in liquid assets at the end of Q2, the EV startup says it now has enough to make it to Q4 2025.

Zooming out: While Lucid’s success is closely linked to its relationship with the PIF, CEO Peter Rawlinson has spoken openly about his discomfort with relying too heavily on Saudi investments.

• “If I adopt a mindset that there is bottomless wealth from PIF, that is very dangerous, that is something I will never do, I respect them far too much for that,” Rawlinson said in a March interview with the Financial Times.

Bottom line: With electric car sales growing slower than expected across the board, Lucid’s successes, however small, are impressive. Yet, just like its peers in the space, the company is unlikely to last long-term without a dramatic reversal in the EV market, no matter how patient its financiers may be.

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