TLDR
- Lucid stock fell 6.3% following announcement of Saudi supercomputing partnership amid tariff concerns
- Company delivered 3,109 vehicles in Q1 2025, up from 1,967 in Q1 2024
- Lucid faces negative gross margins of -114% despite 36% revenue growth
- First quarter earnings report expected May 6, with projected revenue of $232-236 million
- New Gravity SUV launched with 450-mile range; midsize SUV planned for 2026 below $50,000
Lucid Group’s stock dropped 6.3% on Monday as investors reacted to news about the company’s partnership with a Saudi Arabian university amid growing concerns about potential tariff impacts. This comes just before the electric vehicle maker’s first-quarter earnings release scheduled for May 6.
The California-based EV manufacturer announced a new collaboration with King Abdullah University of Science and Technology that will give Lucid access to advanced supercomputing systems.
The two organizations will work together on developing new components and autonomous driving technology.
Saudi Connections and Tariff Worries
Saudi Arabia’s Public Investment Fund (PIF) remains Lucid’s majority stakeholder and main source of financing. While this relationship has provided the company with regular capital injections, it could become problematic given recent tariff moves.
The Trump administration recently announced a 100% tariff on foreign movies. This shift to taxing non-physical products has raised questions about whether similar tariffs might target foreign-originated designs or technologies.
These concerns appear to be weighing on investor sentiment despite Lucid’s potentially beneficial technology partnership.
Cantor Fitzgerald maintained its Neutral rating on Lucid with a $3 price target. The stock currently trades around $2.53.
Production and Delivery Progress
In the first quarter of 2025, Lucid delivered 3,109 vehicles, up from 1,967 in the same period last year. The company also produced 2,212 vehicles, exceeding the 1,728 vehicles manufactured in Q1 2024.
Lucid sent an additional 600 vehicles to Saudi Arabia for final assembly during the quarter.
For the full year 2024, Lucid delivered 10,241 vehicles and produced 9,029 units.
The company has provided first-quarter revenue guidance between $232 million and $236 million. Lucid is maintaining its full-year 2025 production guidance of 20,000 vehicles.
Despite achieving 36% revenue growth over the last twelve months, Lucid continues to operate with negative gross margins, currently at -114%.
Analysts expect negative gross margins of approximately 95% for the first quarter, though the company is actively working to improve this metric.
Lucid is expected to post another substantial net loss when it reports Q1 results, following a $636.9 million loss in the fourth quarter of 2024.
The upcoming earnings call will likely provide insights into initial sales of Lucid’s new Gravity SUV, which launched earlier this year. The vehicle promises a driving range of up to 450 miles and rapid charging capabilities.
Investors will also be looking for updates on Lucid’s planned high-volume midsize SUV, targeted to start production in late 2026 with a starting price below $50,000.
Recent financial moves include securing $1.1 billion through a convertible senior notes offering. The net proceeds are aimed at supporting growth and general corporate purposes.
Benchmark analysts have maintained a Buy rating for Lucid with a $5 price target.
Some analysts believe Lucid could benefit from recent Tesla sales declines, potentially capturing more market share in the premium EV segment.
The company’s strong vertical integration and U.S.-based manufacturing may limit its exposure to tariffs compared to other automakers.
Lucid is expanding its production capabilities with a new facility in the Middle East, focusing on regional demand.
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