Lucid Group (LCID) Q2 FY26 earnings call: guidance and Q&A

How confident is the new CEO in stabilizing Lucid, and what message does he have for loyal customers?

The CEO expressed extreme confidence in Lucid's future, citing strong technology, people, and customer loyalty. He emphasized that delivering on the '3Cs' and '4 must-win projects' will build a stronger company, reward loyalty with performance, and improve service and products.

“If I'm here, it's because I'm extremely confident in Lucid's future. The one thing that impressed me the most in joining is the depth of our technology, the strength of our people, but also the engagement and loyalty of our customers.”

asked by John R. · answered by Silvio Napoli

How is the restructuring of expenses, manufacturing, and software progressing under new leadership?

The CEO focused on software improvements, noting a review of the entire software process from conception to service. He highlighted changes in over-the-air upload processes, improved efficiency and quality, and positive feedback on the Gravity 3.6 release, emphasizing software as a key opportunity for performance improvement.

“I was at our factory last week and I witnessed firsthand as an example how we are actually bringing software engineers and manufacturing line experts together in order to improve the process. And as an example, we totally changed the way we do over-the-air upload of our software in our vehicles.”

asked by Vikas A. · answered by Silvio Napoli

Is Lucid ready to expand into ESS, potentially working with Saudi Arabia to achieve its 2030 goals?

The CEO acknowledged ESS as a significant opportunity, which Lucid Technologies is meant to drive, starting with Robotaxi. However, he stressed the immediate priority is stabilizing the core business through the '3Cs' and '4 must-wins' before pursuing other resource-intensive opportunities like ESS, to ensure a sustainable platform for future growth.

“ESS is definitely one of them. There are actually, in fact, many more, and I look forward to putting ourself in the position to address all of them. But thank you for the confidence shown in your question. That, again, indeed shows a big opportunity for Lucid going forward.”

asked by William I. · answered by Silvio Napoli

What are the remaining milestones for AMP-2 completion and Midsize production, and how should investors track initial deliveries?

For AMP-2, remaining milestones include industrialization testing, which is on track for year-end, and external factors like local certification and supplier network development. For Midsize, all certifications and internal quality checks are ongoing, with a commitment to launch only when ready. Initial deliveries will be communicated when the exact date in 2027 is clear.

“The third element, which is not entirely in our control is the supplier's network which is due to be built around this new manufacturing area being built in the very same geographical location where the factory is.”

asked by Andres Sheppard-Slinger · answered by Silvio Napoli

What milestones should investors monitor for robotaxi progress, and what are key learnings from testing in San Francisco and Houston?

The CEO stated that progress involves accumulating miles (on-road and virtual) and passing certifications, with no red flags on the engineering side. He noted the ease of integrating Lucid's software-defined vehicles with new firmware. The next stage of validation will be observing the performance of prototype vehicles being assembled and shipped to partners.

“It is really essentially about how to make sure that all the checks and balances, all the redundancies, which are very much safety related, function through operations.”

asked by Alexander Perry · answered by Silvio Napoli

How much does Lucid plan to underproduce relative to deliveries, what is the ultimate inventory goal, and when will right-sizing be complete?

CFO Taoufiq Boussaid stated the goal is to return to normalized inventory levels by year-end 2026, which is a key component of the $1.4 billion cash optimization plan. Production will slow down, while deliveries are expected to grow in H2 due to seasonality, helping to burn down existing inventory and release trapped cash.

“So what we want to do is that between now, and year-end we come back to a normalized inventory level so that's the plan that we're building so that's also one of the key components of the $1.4 billion cash optimization plan that we're working on.”

asked by Alexander Perry · answered by Taoufiq Boussaid

What is Lucid's strategy regarding consolidating Midsize production into AMP-1 or mothballing AMP-2 to improve capital efficiency and utilization rates?

The CEO explained that AMP-1 is designed for Air and Gravity, and introducing a new line would create inefficiencies. AMP-2 in Saudi Arabia is designated for the new Midsize platform. The plan is to optimize capacity utilization by considering robotaxi volumes and other future opportunities, but for now, the factories are distinct.

“The way the factory is designed, introducing a new line will create inefficiencies on the other models. That's why the decision was taken to put this factory with a new platform in Saudi Arabia with AMP-2.”

asked by Andrew Percoco · answered by Silvio Napoli

Is the underlying business plan changing regarding willingness to license technology or the focus on Midsize, or is it primarily financial and cost-related adjustments?

The CEO confirmed that licensing technology is an option and Lucid Technologies will explore selling components to other industries. However, the immediate priority is stabilizing the core business through the '3Cs' and '4 must-wins' to create a sustainable model. The focus on Midsize remains essential.

“I think as we look at our business planning, licensing absolutely is an option. And Lucid Technologies is indeed also one of the activities will be to license or sell our components into either automotive, EV, but possibly also to other industries.”

asked by Stephen Gengaro · answered by Silvio Napoli

What will the go-forward marketing and branding campaign look like, especially ahead of the Midsize launch, given production curtailment?

The CEO stated that a brand audit was initiated this week to reposition the brand consistently with the product. The goal is to build on Lucid's strong brand asset, clarify its unique offerings, and increasingly incorporate the customer experience and emotional connection to the products, independent of current volume.

“I call it a brand audit, and then it will allow us to reposition our brand in a way that is consistent with our product. Today, our brand is very strong, but I think it is fair to say the approach, the understanding of the brand is not consistent across every sector, every market, and I'm going to say even internally within a company in the sense of how people see that.”

asked by Itay Michaeli · answered by Silvio Napoli

How can Lucid improve unit economics during a period of lower volume, and what are some targets?

The CEO indicated that while specific targets cannot be provided, suppliers have been supportive in optimizing volumes and profitability. Internal efforts include streamlining the configurator to focus on trims that support better economics, which is a significant opportunity. This is part of an ongoing exercise to improve every aspect of the business.

“For example, we have way too many options. So working on our configurator to make sure we focus on the trims that also support economics, is a key element and you can imagine that is in itself a good opportunity.”

asked by Itay Michaeli · answered by Silvio Napoli