Wednesday, October 22, 2025

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Lucid Completes US$1.5 Billion Equity Offering, Yet Valuation Still Looks Rich

On December 19, Lucid Group, Inc. (NASDAQ: LCID) revealed it had completed the US$1.515 billion equity raise it announced in early November. Lucid raised $600 million from selling 56.2 million shares in an “at-the-market” (ATM) issuance and a further US$915 million from the private placement of 85.7 million shares to its core investor, a Saudi Arabian investment fund which owns a 60+% stake in Lucid. Lucid’s total shares outstanding are now 1.82 billion, about 8% more than the 1.68 billion shares outstanding before the offering.

Lucid shares were sold both to the public and its core Saudi investor at an average price of US$10.68 per share, far higher than the current price of US$7.18. Presumably, the shares were sold soon after the November 8 announcement of the stock selling plan because the last time Lucid shares closed above US$10.68 was November 18.

The specifics of Lucid’s share price trajectory related to the offering are interesting because it appears that ATM share sales by Lucid had less to do with the decline in the stock in 4Q 2022 than investors’ perception of worsening fundamentals for Lucid and the electric vehicle industry.  

Lucid’s cash as of September 30, 2022 was US$3.34 billion, so its pro forma (for the offering) cash balance on that date is about US$4.85 billion. While that quantity of cash is large for any company, trends in Lucid’s operations imply that perhaps half of it could disappear by mid-2023. This suggests another large equity offering could be required as early as the second half of 2023. 

The company burned more than US$800 million of cash per quarter in both 2Q 2022 and 3Q 2022 (defined as operating cash flow deficit plus capital expenditures) and appears on track to record a cash drag of similar magnitude in 4Q 2022. Even assuming a lower rate of cash burn in 1Q 2023 and 2Q 2023, Lucid’s cash balance could be well below US$3 billion by mid-2023.

(in thousands of US $, except production/delivery unit statistics and for shares outstanding)4Q 2022 GuidanceSeptember 30, 2022June 30, 2022March 31, 2022December 31, 2021
Lucid Air Vehicles Delivered1,398679360125
Year-to-Date Deliveries2,4371,039360
Lucid Air Vehicles Produced2,313-3,3132,2821,405 (A)
Year-to-Date Production3,6871,405
Revenue$195,457 $97,336 $57,675 $26,392 
Operating Income($687,523)($559,199)($597,530)($485,684)
Operating Cash Flow($569,466)($513,628)($494,639)($312,733)
Capital Expenditures($415,054)($290,064)($309,800)($185,082)
Adjusted EBITDA ($552,903)($414,082)($383,781)($299,583)
Cash – Period EndSufficient liquidity into at least 4Q 2023$3,342,181 $4,294,082 $5,391,844 $6,262,905 
Debt – Period End$2,079,722 $1,999,234 $1,998,571 $1,997,057 
Shares Outstanding (Millions)1,820 1,681 1,668 1,668 1,668 
(A) 1,405 vehicles were produced in the first half of 2022.

Separately, Lucid’s stock price is feeling the effects of perhaps the most pessimistic investor sentiment toward the EV industry in some time. Bellwether Tesla, Inc.’s (NASDAQ: TSLA) share price has been cut more than 50% in just three months. Furthermore, at least one media source is reporting Tesla has implemented a hiring freeze and plans to announce another round of layoffs in January 2023. Such developments tend to dissuade new investors from considering EV stocks.

Lucid stock is down nearly 90% from its all-time high 13+ months ago, but its enterprise value is still more than US$10 billion. That valuation continues to seem robust given Lucid’s extremely high cash burn rate and the great uncertainty surrounding when positive cash flow could be attained.

Lucid Group, Inc. last traded at US$7.18 on the NASDAQ.


Information for this briefing was found via Edgar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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