Lucid Group Inc (LCID:US), an EV manufacturer in the US, just announced its Q3 earnings. The company reported a loss per share of 28 cents from a revenue of $137.8 million. Wall Street was expecting a loss per share of 40 cents. While the company did post a beat on this expectation, there was hardly any other positive coming out from the company’s operations.
The company reported disappointing delivery numbers which prompted some to question its profitability. The market started pricing in a decline in sales from six months ago, something that was confirmed in its earnings report yesterday. It reported $137.8 million in sales, way below the $178 million that Wall Street was expecting.
Any company that loses almost half its sales over the course of three quarters is asking for trouble. Add to that the fact that the company isn’t profitable, has production issues, and is consuming cash in a high interest-rate environment, and LCID certainly doesn’t make for an attractive investment at the moment.
The Roller Coaster Ride Politicians Want No Part of
Since then, there have been three more sell transactions in the stock, all in the $1,000 to $15,000 range. No politician has dared to buy the stock this year, and the most recent quarterly report clearly shows the reason why. The company has a lot to do to succeed in a business that is not easy to execute.
A CEO Under Fire
The person in charge of Lucid Motors, Peter Rawlinson, is also in the news for all the wrong reasons. While his company struggles to keep up with sales targets, he stands out as the highest-paid automotive CEO in the US.
He earned $379 million in 2022, 11 times more than the second highest salary of an automotive company's CEO: Mary Barra of General Motors. This kind of compensation does not inspire a lot of confidence among investors and is another reason why people prefer to stay away from the company’s stock.
LCID’s problems are well reflected in its share price, which has been going down since January. The stock has resulted in a loss of almost 39% year-to-date. Over the course of the last year, the losses stand at 68.99%.
The stock last closed at $3.75 after hitting a new 52-week low of $3.72.