Lucid receives $1.5B in Saudi funding ahead of new EV launch

Shares of Lucid Group (LCID) are trading higher Tuesday following news of additional funding from a major shareholder, Saudi Arabia's Public Investment Fund (PIF). Already holding nearly a 60% stake in the EV maker, the PIF has agreed to provide an extra $1.5 billion in funding.

This financial boost comes as Lucid prepares to launch its newest electric vehicle model, the Lucid Gravity SUV. The California-based automaker reported mixed second quarter earnings, beating revenue estimates with a figure of $200.6 million.

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Angel Smith

Video transcript

Lucid shares are up just about 2.8%.

Nearly 3% move to the upside after announcing its largest shareholder, Saudi Arabia's public investment fund will give the firm an additional $1.5 billion in funding.

Now, this coming as the company gets set to launch its new electric vehicle.

Lots of questions about what ultimately the future of Lucid looks like.

So again, the fact that they did get this cash infusion, obviously, this is going to extend the timeline here cities out estimating that the new $1.5 billion capital raise is expected to extend Lucid's liquidity runway all the way to the fourth quarter of 2025.

It also went on to say it's going to help Lucid here navigate what has been uh clearly a global slowdown when it comes to ev demand.

Also the launch of its mass market SUV and remember that this funding comes on top of a billion dollar injection back in March and raises the total that the Saudi Aramco Fund has invested into approximately $8 billion.

So again, Lucid shares moving to the upside, they are off their highs of the morning.

But again, the street, obviously viewing this as a positive here for the stock.

Yeah, it's interesting because last quarter, there were concerns about liquidity with lucid and of course, today, that's not a concern given this $1.5 billion cash infusion that they are getting from the Saudis.

The big question I'm gonna have is what the executive team is going to be doing with that infusion of liquidity and whether or not they're going to be able to utilize it to continue to reach further gains, particularly with investments in the Suvev.

And what that's going to look like in terms the RO I on that moving forward.

Obviously, the street is thinking that that $1.5 billion in funding is going to be a positive catalyst for the stock moving forward.

Again, the announcement from the Public Investment Fund of Saudi Arabia is committed to providing what they say, quote is sufficient liquidity into at least the full fourth quarter of 2025.

So certainly a little bit of runway to come for that infusion of cash.