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Lucid Group reported third-quarter results below Wall Street expectations but secured a $1.75 billion loan from Saudi Arabia's Public Investment Fund, sending its shares down 5% in aftermarket trading.

Lucid Misses Earnings, Secures Saudi Loan Amid Restructuring Challenges

Lucid Group revealed third-quarter financials that fell short of analyst revenue and earnings per share forecasts. The company also announced an expanded $1.75 billion delayed draw term loan from Saudi Arabia’s Public Investment Fund, boosting total liquidity to $3.75 billion. CEO Silvio Napoli emphasized a restructuring plan targeting cost reductions and delaying the midsize vehicle launch until late 2027.

While Lucid's adjusted EBITDA loss of $726 million beat expectations, signaling progress in its turnaround efforts, revenue missed by nearly $57 million to $350 million. Net losses widened slightly from $978.4 million a year earlier to $830.9 million for the quarter.

The Saudi loan provides immediate financial breathing room but raises questions about Lucid’s long-term independence. The company faces risks of eroding investor confidence with continued revenue shortfalls and reliance on foreign capital, while opportunities include funding robotaxi programs and factory expansions through its new liquidity.

Lucid plans to outline its midterm strategy in early 2027, with midsize vehicle production expected by late 2027. The company will use the $1.75 billion loan for operations and investments throughout 2027.

Lucid’s restructuring shows progress with improved EBITDA metrics but faces critical challenges in scaling revenue and reducing dependency on Saudi funding.

Topics: Markets, Finance/Markets, Tech/AI, Automotive Industry, Corporate Restructuring

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Source: CNBC