Q2 2025 Lucid Group Inc Earnings Call

Being recorded.

We will conduct a question and answer session. If you have a question. Please press star one on your Touchtone telephone I would now like to turn the conference over to your speaker for today, Nick torque Vice President of Communications. Please go ahead.

Thank you and welcome to Lucy group's second quarter 2025 earnings call.

Joining me today are mark winter off our interim CEO and healthy.

Our CFO.

For handling the call over to Mark Let me remind you that some of the statements on this call include forward looking statements under Federal Securities Law. These include without limitation statements regarding the future financial performance of the company production and delivery volumes vehicles and products Studios and service networks financial and operating outlook in <unk>.

<unk> macroeconomic policy and industry trends tariffs and trade policy company initiatives and other future events.

These statements are based on various assumptions, whether or not identified in this communication and on the predication and expectations of our management as of today.

Ladies and gentlemen, thank you for standing by and welcome to the Lucid group. Second quarter 2025 earnings conference call.

Actual events or results are difficult or impossible to predict and may differ due to a number of risks and uncertainties.

Please be advised. That today's conference is being recorded later, we will conduct a question and answer session. If you have a question, please press star 1 1 on your touchtone telephone.

We refer you to the cautionary language and the risk factors in our annual report on Form 10-K for the year ended December 31, 2024. Subsequent quarterly reports on Form 10-Q current reports on form 8-K, and other SEC filings.

I would now like to turn the conference over to your speaker for today. Nick torque vice president of communications please go ahead.

Thank you and welcome to Lucy's group second quarter 2025 earnings call.

And the forward looking statements on page two of our quarterly earnings presentation available on the Investor Relations section of our website at IR <unk> Dot com, we undertake no obligation to revise or update publicly any forward looking statement for any reason, except as required by law.

Joining me today are Mark wynhoff, our interim CEO and tie R CFO.

In addition management will make reference to non-GAAP financial measures. During this call a discussion of why we use non-GAAP financial measures and information regarding reconciliation of our GAAP versus non-GAAP results is available in our earnings press release issued earlier this afternoon as well as in the earnings presentation.

With that I'd like to turn the call over elusive interim CEO Mark Winter half Mark. Please go ahead.

Before handing the call over to Mark, let me remind you that some of the statements on this call include forward-looking statements under Federal Securities Law. These include, with all limitations, statements regarding the future financial performance of the company, production and delivery volumes, vehicle and product studios, service networks, financial and operating outlooks and guidance, macroeconomic policy and industry trends, tariffs and trade policy, company initiatives, and other future events. These statements are based on various assumptions, whether or not identified in this communication, and on the predictions and expectations of our management as of today.

Thank you Nick.

Thank you everyone for joining us in our second quarter 2025 earnings call.

Actual events are results, are difficult or impossible to predict, and may differ due to a number of risks and uncertainties.

I'd like to begin by expressing my sincere appreciation to our employees customers partners and shareholders you.

You will continue to believe in our mission is what drives us forward everyday.

We refer you to the cautionary language and the risk factors and are in a report on form. 10K for the year ended, December 31, 2024, subsequently reports on form 10q current reports on Form 8K. It's another sec filings.

In the second quarter of 2025, we achieved meaningful progress on both operational and strategic fronts.

We delivered 3309 vehicles up 38% year over year.

And the forward-looking statements on page 2 of our quarterly earnings presentation available on the investor relations section of our website at IR. Lucid motors.com

Now our sixth consecutive quarter of record deliveries.

We undertake no obligation to revise or update publicly any forward-looking statement for any reason except as required by law.

Produced.

863 vehicles up 83% year over year.

As expected ASP increased sequentially this quarter due to improved mix. However, gross margin was negatively impacted by tariffs.

Two feet will detail in his remarks.

In addition management will make reference to non-gaap financial measures during this call. A discussion of why we use non-gaap Financial measures and information regarding reconciliation of our gaap versus non-gaap results is available. In our earnings press release issued earlier this afternoon as well as in the earnings presentation.

First.

We've been sharing with you that we are in active discussions about partnerships beyond selling or licensing our industry, leading <unk> technology.

With that. I'd like to turn the call over to lucid's in term CEO Mark winterhoff Mark. Please go ahead.

On July 17, we took a big step in this direction with the announcement of our partnership with Uber and Euro on our next generation premium Robo taxi created specifically for use on Uber ride hailing platform.

Thank you, Nick, and thank you everyone for joining us. In our second quarter, 2025 earnings call.

I would like to begin by expressing my sincere appreciation to our employees, customers, partners, and shareholders.

You'll continue to believe in our mission is what drives us forward every day.

This partnership combines the industry, leading software defined vehicle architecture for lucid gravity, the scalability and proven capability of the new ROE driver level, four autonomous system, and ubers vast global network and dynamic route management.

In the second quarter of 2025, we achieve meaningful progress on both operational and strategic fronts.

We delivered 339. Vehicles up, 38% year-over-year.

Delivering a fully integrated robotics experience developed for comfort safety and scale.

In our sixth consecutive quarter of record deliveries.

Our industry, leading efficiency and technology like our <unk> capable center suite redundant steering and braking systems and highly efficient compact and high power density Motors helped maximize uptime and reduce operating cost per mile.

We produced 3,863 vehicles, marking an 83% year-over-year increase.

As expected, ASP increased sequentially, this quarter due to improved mix. However, gross margin was negatively impacted by tariffs.

As to feet will detail in his remarks.

Key success factors in a successful robo taxi program.

The looser gravity software defined architecture makes it the ideal platform for third party autonomy stacks.

First, we've been sharing with you that we are inactive discussions, about Partnerships Beyond selling or licensing. Our industry-leading EV technology

As part of the agreement.

<unk> will invest $300 million in losses subject to regulatory review.

Google plans to deploy a minimum of 20000 due to gravity vehicles.

on July 17th. We took a big step in this Direction with the announcement of a partnership with Uber and Gyro on a Next Generation, premium robot taxi created, specifically for the use on Uber's, right? Handling platform.

Clipped with the new driver over six years and dozens of markets around the world.

With the first vehicles launching late next year.

This is an important step for lucid into the multi trillion dollar ruble taxi market, but its only the first step.

Find the industry-leading, software-defined vehicle architecture of the Lucid Gravity, the scalability and proven capability of a neuro driver level 4 autonomy system and Uber's vast, Global Network and dynamic heat management.

And while we are working with external partners on this initiative.

Delivering a fully integrated robotaxi experience developed for comfort, safety, and scale.

Continue developing our internal Adas capabilities, such as our recently announced hence we driving software update with more improvements to be announced.

We're also leveraging our partnership with the King Abdullah University of science, and technology or cost to train our models for interest and bring cutting edge innovation from the lab to the road.

Our industry-leading efficiency and Technology like our av capable sensor Suite, redundant steering and braking systems, and highly efficient Compact, and high power density, Motors help maximize uptime and reduce operating costs per mile.

Please discuss the success factors in a successful robot taxi program.

I've been clear about.

Our intention to monetize Bluetooth technology through licensing deals or strategic partnerships.

The Lucid gravity software defined architecture makes it the ideal platform for third-party autonomy stacks.

As part of the agreement.

And this announcement signals our right to win in new markets.

Uber will invest, $300 million in Lucid subject to regulatory review.

Google's investment in Louis It is yet. Another example of a third party validating our highly advanced technical platform and we remain in active discussions with other potential partners.

Uber plans to deploy a minimum of 20,000. Lucid gravity Vehicles equipped with the neuro driver, over a 6 years in dozens of markets around the world.

Second.

With the first vehicles launching late next year.

We followed through on our commitment to drive awareness.

And Lucy brand last week, when we announced Timothy Shlomi.

This is an important step for Lucid into the multi-trillion dollar ruble taxi Market, but it's only the first step.

With its first ever global brand Ambassador.

<unk> will be featured in our new campaign promoting with gravity that marks another significant milestone in our commitment to raise brand awareness.

This first campaign of the partnership will launch in early September.

And while we are working with external partners on this initiative, we continue developing our internal AID and adding capabilities, such as our recently announced hands-free driving software update, with more improvements to be announced.

In addition to stimulating near term demand this multi year partnership with Timothy is designed to anchor the loser brand in popular culture ahead of our entry into the mass market with our midsize vehicles.

We also leveraging our partnership with the King Abdullah or University of Science and Technology, or cost to train, our AI models, for a, and add, and bring Cutting Edge Innovation from the lab to the road. I've been clear about

Now, let me take a moment to go in depth to explain how these initiatives.

Our intention to monetize Lucid technology through licensing deals or strategic Partnerships.

And this announcement signals our right to win in new markets.

Into our mission to not just deliver the best car in the world, but also the best business.

Since we started our respective roles to silicon I have dedicated time to aligning our priorities for the business.

Uber's investment in Lucid. Is yet. Another example of a third-party validating, our highly Advanced technical platform and we remain inactive discussions with other potential partners.

Second.

We are laser focused on three important near term priority for new sites. These are.

Operational discipline.

Second building a distinctive scalable brand.

Third maintaining and enhancing our sustainable edge through our technology.

Operational discipline relates to manufacturing cost control and practically every element of the business.

We follow through on our commitment to drive awareness for our products and the Lucid brand. Last week, when we announced Timothy Shalom as Lucid's first-ever Global Brand Ambassador, Shalom will be featured in a new campaign promoting Lucid Gravity. That marks another significant milestone in our commitment.

Meant to raise brand awareness.

As we communicated in our press release.

This first campaign of the partnership will launch in early September.

Our target is to produce 18 to 20000 total vehicles in 2025.

And as of the second.

Second quarter, we have produced just over $6.

On this topic.

in addition, to stimulating near-term demand, this multi-year partnership with Timothy is designed to Anchor, the Lucid brand in popular culture ahead of our entry into the mass Market with our midsize vehicles,

So that it is important to acknowledge that we are not where we want to be with lucid gravity production relative to our target at this point in the year. However, our team has been working very hard all year to address bottlenecks in our supply chain and improve manufacturing efficiency.

Now, let me take a moment to go in depth to explain how these initiatives.

Fit into our mission to not just deliver the best car in the world, but also the best business.

I'm happy to say that we have overcome most of these issues and are beginning to ramp up lucid gravity production.

Since we started our respective roles, I have dedicated time to aligning our priorities for the business.

We are laser focused on 3 important near-term priorities for Lucid. These are

We believe we will significantly increase production in the second half of the year.

First operational, discipline.

The challenges we faced we are multifold.

But can primarily be attributed to first the capacity of certain suppliers in our supply chain and second the availability of magnitude originating in China, an industry wide challenge.

Second building a distinctive, scalable brand, and third maintaining, and enhancing a sustainable Edge through our technology.

Operational, discipline, relates to manufacturing, cost, control and practically every element of the business.

To the first point, we have been working closely with our suppliers to alleviate issues that could prevent us from producing the necessary volume to achieve our targets in the second half of the year.

As we communicated in our press release,

Our target is to produce 18,000 to 20,000 total vehicles in 2025.

And as of the second quarter, we have produced just over 6,000.

We've also implemented key initiatives that are focused on fostering enhanced accountability and data driven decision making.

We are already seeing the benefits of this as we work diligently to improve lucid gravity production.

Turning to the second point to mitigate geopolitical supply chain challenges our team was able to quickly integrate substitute magnets in production and because of our nimble in house vertical integration. This process took weeks instead of months.

On this topic I feel that it is important to acknowledge that we are not where we want to be with Lucid gravity production relative to our Target at this point in the year. However, our team has been working very hard all year to address bottlenecks in our supply chain and improve manufacturing efficiency.

I'm happy to say that we have overcome most of these issues and are beginning to ramp up Lucid Gravity production.

Software changes manufacturing changes in software and hardware integration over together to make this happen.

We believe We Will significantly increase production in the second half of the year.

The challenges we faced were multifold.

Without our vertical integration and the ability for our team to make quick changes we would have stopped production in Q2.

Im happy to say that we believe this issue is behind us and we have secured enough magnets to meet our production targets for the remainder of the year.

bias and our supply chain and second, the availability of magnets originating in China, an industry-wide challenge

As we have noted before we have a strong commitment to our U S based manufacturing.

to the first point we've been working closely with our suppliers to alleviate issues that could prevent us from producing at the necessary. Volume to achieve our Targets in the second half of the year.

We believe this will make us more resilient and help mitigate the impact of tariffs and other geopolitical issues in that regard I wanted to highlight a couple of recent announcements.

We've also implemented key initiatives that are focused on fostering, enhanced accountability and data-driven decision-making.

That further support our positioning.

We are already seeing the benefits of this as we were diligently to improve Lucid gravity production.

First in June we announced a preliminary agreement with clarified one to source natural and synthetic graphite domestically beginning in 2028.

This agreement complements our existing non binding supply agreement with clarified one that was signed in April of 2024.

Learning to the second point to mitigate geopolitical supply chain challenges. Our team was able to quickly integrate substitute magnets in production and because of our Nimble in-house vertical integration. This process took weeks instead of months,

Following this announcement.

We hope to establish the minerals for national automotive competitiveness collaborations for <unk>.

Software changes, manufacturing, changes and software. Hardware integration all work together to make this happen.

A partnership among U S critical minerals produces.

Without our vertical integration and ability for our team to make quick changes, we would have stopped production in Q2.

That are focused on supporting U S based manufacturing and sourcing.

We view this as necessary corrective steps to help insulate our supply chain from global volatility.

I'm happy to say that we believe this issue is behind us and we have secured enough magnets to meet our production Target for the remainder of the year.

We also recently celebrated the opening of Panasonic U S factory in Desoto, Kansas.

As we have noted before, we have a strong commitment to our us-based Manufacturing.

Panasonic is one of our key suppliers and the presence of this U S factory will strengthen our domestic supply chain starting in 2026.

We believe this will make us more resilient and help mitigate the impact of terrorists and other geopolitical issues in that regard. I wanted to highlight a couple of recent amounts

Our next priority is to amplify demand through brand marketing and partnership initiatives.

that further support our position.

Our team's hard work in this regard has been on display in recent announcements over the past few weeks that have already discussed.

First in June, we announced a preliminary agreement with clarified 1 to Source natural and synthetic graphite domestically beginning in 2028.

I am pleased with the progress we are making to enhance our brand but this work is only the beginning.

This agreement complements our existing non-binding supply agreement with Clarified 1, which was signed in April 2024.

As I mentioned earlier in my remarks in September we plan to launch a new gravity brand campaign.

Following this announcement, we helped establish the Minerals for National Automotive Competitiveness collaboration, or MAK.

Featuring Timothy Salomi as part of our broader partnership.

The partnership Among Us, critical minerals producers.

To further deepen brand affinity and trust, we are expanding our efforts beyond traditional advertising.

That are focused on supporting U.S.-based manufacturing and sourcing.

This includes new brand ambassador partnerships with World class athletes influential cultural voices and globally recognized creators.

if you this as necessary, corrective steps to help insulate our supply chain, from Global volatility,

Our vision and values.

We are also developing strategic collaborations with brands and organizations at the forefront of sport and culture.

These partnerships will allow us to tapping in new communities and strengthen emotional connection consumers with our brand.

We also recently celebrated the opening of Panasonic's U.S. factory in De Soto, Kansas. Panasonic is one of our key suppliers, and the presence of this U.S. factory will strengthen our domestic supply chain starting in 2026.

Our next priority is to amplify demand through brand marketing and partnership initiative.

Regarding the scalability of our brand many new customers are now experiencing Lucy gravity in our studios and we're seeing the high order conversion rate for prospective customers once.

Our team's hard work in this regard has been on display through recent announcements over the past few weeks that have already discussed.

We experienced the vehicles.

I'm pleased with the progress. We are making to enhance our brand, but this work is only the beginning.

In fact, our daily order rate has nearly doubled since display and test drive vehicles has been widely delivered to studios.

As I mentioned earlier, in my remarks, in September, we plan to launch a new Gravity brand campaign.

Our final priority is to maintain and enhance our competitive edge through our technology.

Featuring Timothy Shalom as part of our broader partnership.

Engineering technological excellence have long defined lucid brand and we remain committed to these tenets as we grow the business.

To further deepen brand affinity and Trust. We are expanding our efforts Beyond traditional advertising.

Just a few days ago, we deployed a software update to our Dream drive pro advanced driver assist system.

This includes new brand ambassador Partnerships with worldclass athletes influential cultural voices, and globally recognized creators who share our vision and values.

This update enabled hands free driving and name changes and is also expected to be released for lucid gravity later this year.

We are also developing strategic collaborations with brands and organizations at the forefront of sport and culture.

Recently, we also began production of the 2026 and <unk>, which features a new battery pack for touring models that extend the model's EPA rated range to 431 miles compared to 406 and the previous model year.

These partnerships will allow us to tap into new communities and strengthen the emotional connection consumers have with our brand.

Regarding the scalability of our brand.

Notably all 2026 lucid air models now utilize the same AC compressor as diluted gravity, marking the beginning of further efforts aimed at pod communization across our vehicle lines.

Many new customers are now experiencing Lucy gravity in our Studios and we're seeing a high order conversion rate for prospective customers 1.

The experience, the vehicle.

In fact, our daily order rate has nearly doubled since display and test drive vehicles have been widely delivered to Studios.

The lucid air Grand touring demonstrates its range leadership recently.

Our final priority is to maintain and enhance our Competitive Edge through our technology.

By garnering the Guinness World record.

The longest journey by an electrical vehicle on a single charge.

Additionally, con driver named the <unk> Sapphire.

Engineering and technological. Excellence have long defined, Lucid brand and we remain committed to this tenets as we grow the business.

Quickest call this ever tested topline the Porsche Thaicom <unk> GT visor.

Just a few days ago, we deployed a software update to our Dream Drive Pro Advanced Driver Assist System.

The air Sapphire set of <unk> to 60 time of 1.9 seconds and completed the quarter mile in nine one seconds.

Changes. And it's also expected to be released for Lucid Gravity later this year.

And Jayson commits us ultimate drug race on Haggerty.

Gravity three Medusan was dual motors completed the quarter mile and 10 five seconds matching the cord motor Arabian Awanis.

When we had the looser gravity truly stood out often acceleration beyond 60 mph showcasing the superior passing power and highway emerging confidence that define lucid performance.

Recently we also began production of the 2026 Lucid air, which features a new battery pack. For touring models that extends the model's EPA rated range to 431 Mi compared to 406 in the previous model year.

The same looser gravity dream addressing can also reach.

Notably all 2026, Lucid air models. Now, utilize the same AC compressor as the Lucid gravity. Marking the beginning of further efforts aimed at part communization across our vehicle lines.

150 horsepower faster than corporate.

Zero six according to current driver.

The Lucid air Grand Touring demonstrates, its range leadership recently.

At the beginning of my remarks, I highlighted our recent partnership with Uber, and neuro, which showcases and validates that the advanced capabilities of lucid gravity provide an ideal platform on which to integrate <unk> technology.

By garnering beginners world record of the longest journey by an electrical vehicle on a single charge.

Additionally, car driver named the Lucid air, Sapphire the quickest car they've ever tested top. The Porsche tyon Turbo GT visor.

Looking ahead, our midsized platform vehicles will play a crucial role in maintaining elusive competitive edge in technology.

The air Sapphire set a 0 to 60 time of 1.9 seconds and completed the quarter mile in 9.1 seconds.

This vehicle.

Have been meticulously designed to achieve leading product features and specifications with low cost, enabling us to position our company for significant market expansion.

ultimate drug raised on Hagerty the Lucid gravity 3 magician with dual motors, completed the quarter mile in 10.5 seconds matching the court motor rivian r1s

By adopting this approach we aim to strike a balance between cost competitiveness and high volume production.

While still preserving the premium attributes that our customers have come to expect from lucid.

But where the Lewis, the gravity truly stood out was an acceleration Beyond 60 MPH showcasing, the superior passing power and Highway merging confidence that Define lucid performance.

Technology leadership is the key enabler for this previously opposing combination.

The same Lucid gravity dream Edition.

Can also reach.

A prime example of this approach is our ethos drive unit, which serves as the cornerstone of our higher volume and cost efficiency strategy.

150 miles per hour faster than a Corvette Z06. According to current driver,

We are committed.

Our powertrain efficiency leadership.

While simultaneously achieving lower costs and maintaining exceptional performance.

At the beginning of my remarks, I highlighted our recent partnership with Uber and Nuro, which showcases and validates that the advanced capabilities of Lucid Gravity provide an ideal platform on which to integrate AD technology.

Lastly, as you May know the lucid gravity was the first non Tesla vehicles sold to offer a built in next connector and supports native Tesla supercharger network access.

Looking ahead, our midsize platform Vehicles, will play a crucial role in maintaining a lucid Competitive Edge in technology.

We have also recently opened this access for lucid air owners as well.

As of July 31st Lucid Air owners with an approved adaptor in North America can now charge their vehicles at any one of the 23500, plus Tesla supercharger locations throughout the country.

These vehicles will have been meticulously designed to achieve leading product features and specifications with a low cost. Enabling us to position our company for significant Market expansion.

With excess integrated into the elusive at.

By adopting this approach, we aim to strike a balance between cost competitiveness and high-volume production while still preserving the premium attributes that our customers have come to expect from Lucid.

This is in addition to more than 30000, Tcs charges already available across North America to lose the drivers.

Technology leadership is the key enabler for this previously opposing combination.

In closing.

We are not simply building electrical vehicles, we are pushing the boundaries of what <unk> can be.

a prime example of this approach, is our Atlas Drive Unit, which serves as a Cornerstone of our higher volume and cost efficiency strategy,

From the record breaking performance and efficiency of polluted air to.

we are committed to our powertrain efficiency leadership.

So the game changing Luther gravity.

Our upcoming mid sized platform, our technology continues to redefine what's possible.

While simultaneously achieving lower costs and maintaining exceptional performance.

But our mission is not only to make the best Evs in the world is to build a great business around that.

That means continuing to drive innovation, while also scaling intelligently building, a robust supply chain and making strategic decisions that position us for long term success.

Lastly, as you may know, the Lucid gravity was the first non-tesla vehicle sold to offer a built-in next connector and supports native Tesla Supercharger network access.

We have also recently opened this access for Lucid Air owners as well.

We are entering a pivotal new face.

One of our World Class Engineering meets World class execution.

And with the talent focus and drive across our team I truly believe we're just getting started.

As of July, 31st, Lucid air owners with an approved adapter in North America, can now charge their vehicles at any 1 of the 2035 plus Tesla Supercharger locations throughout the country.

With excess integrated into the Lucid app.

Thank you for your continued belief and lose it not just as a car company or the company's shaping the future of mobility and American manufacturing.

This is, in addition to more than 30,000 CCS charges already available across North America to Lucid drivers.

In closing.

Thank you Mark and thank you to those who are joining us today I'd like to build on Mark's comment by sharing more details about our operational and financial performance. This quarter I will also provide clarity on the strategic steps, we're taking to position lucid for the long term success.

We are not simply building electric vehicles; we are pushing the boundaries of what EVs can be.

From the record-breaking performance and efficiency of the Lucid Air.

To the game-changing Lucid gravity.

In the last few months, our focus has been on execution.

To our upcoming midsize platform, our technology continues to redefine what's possible.

Strategic commitments into measurable progress across production cost discipline and financial resilience. We have also taken meaningful steps to strengthen our capital structure and accelerate monetization of our technology.

While our mission isn't only to make the best EVs in the world, it's to build a great business around that.

One of our most significant recent developments with our agreement with Uber Anoro, which represents far more than the commercial transaction. It is a strategic alignment with two leading players in mobility and autonomy.

That means continuing to drive innovation while also scaling intelligently, building a robust supply chain, and making strategic decisions that position us for long-term success.

We are entering a pivotal new phase.

Choose lucid gravity as the core platform from the next generation of Robo taxis.

And with the talent focus and drive across our team, I truly believe we're just getting started.

<unk> planned $300 million in investments in lucid subject to regulatory approval will directly support the development and integration of this program.

Thank you for your continued belief in Lucid, not just as a car company or as a company shaping the future of mobility and American manufacturing.

It reflects external confidence in our underlying architecture and is a validation of the broader platform opportunity, we see beyond direct to consumer sales.

It also confirmed our ability to create scalable enterprise value by deploying our technology in new vertical fleet autonomy and AI and mobility in.

Thank you, Mark. And thank you to those who are joining us today. I'd like to build on Mark's comment by sharing more details about our operational and financial performance this quarter. I will also provide clarity on the strategic steps we are taking to position Lucid for long-term success.

In parallel we announced our intention to implement a one for 10 reverse stock split.

This is not a cosmetic action it is a deliberate and targeted measures to ensure the listed equity remains accessible to broader universe.

On the institutional investors. It also aligns our share price with the strategic project worry of the company as we move into the next chapter of scaling our operations and deepening our capital market engagement. The reverse split is expected to take effect in early September subject to shareholder approval.

In the last few months, our focus has been on execution, turning strategic commitments into measurable progress across production, cost discipline, and financial resilience. We have also taken meaningful steps to strengthen our capital structure and accelerate the monetization of our technology, one of our most significant recent developments. Our agreement with Uber and Nuro represents far more than a commercial transaction; it is a strategic alignment with two leading players in mobility and autonomy who choose Lucid Gravity as the core platform for the next-generation robotaxi.

No.

Turning now to the numbers, we have delivered $269 million in revenue in Q2, marking a 29% increase year over year. We produced 3863 vehicles and deliveries reached 3309 units up 28% compared to the same quarter.

Uber's plan, a $300 million investment in Lucid, subject to regulatory approval, will directly support the development and integration of this program.

Last year this marks our sixth consecutive quarter of record deliveries.

Despite the ongoing challenges facing the EV sector, particularly in supply chain, we maintained positive momentum and continued progressing towards our volume targets.

It reflects external confidence in our underlying architecture and is a validation of the broader platform opportunity we see beyond direct-to-consumer sales. It also confirmed our ability to create scalable enterprise value by deploying our technology in new verticals: fleet autonomy and AI mobility.

Given the continuously shifting market environment, we have decided to provide our at our production guidance as a range.

Gross margin for the quarter was negative, 105%, reflecting a $54 million impact from directs alone.

His impact accounted for 21 percentage point decrease in gross margin offsetting the benefit from sequential improvement in Asia.

While we anticipated this pricing pressure.

In parallel, we announced our intention to implement a 1-for-10 reverse split. This is not a cosmetic action; it is a deliberate and targeted measure to ensure Lucid's equity remains accessible to a broader universe of long-only institutional investors. It also aligns our share price with the strategic trajectory of the company as we move into the next chapter of scaling our operations and deepening our capital markets engagement. The reverse split is expected to take effect in early September, subject to shareholder approval.

We're actively taking decisions and decisive action to move margins back towards a positive trajectory. These actions include material cost optimization, improving production efficiency and tighter inventory management.

We also saw continued cost discipline across the organization, while maintaining targeted investments in product and brand.

Turning now to the numbers, we have delivered $259 million in revenue in Q2, marking a 29% increase year-over-year. We produced 3,863 vehicles, and deliveries reached 339 units, up 38% compared to the same quarter last year. This marks our sixth consecutive quarter of record deliveries.

R&D totaled $274 million for the quarter, reflecting higher spend on the mid sized platform and Atlas powertrain SG&A was $257 million a sequential increase.

And normalized following a one time reversal of previously recognized stock based compensation expense in the first quarter. Importantly, we are continuing to make deliberate tradeoffs across the business investing where it matters and streamlining where appropriate.

Despite the ongoing challenges facing the AEV sector, particularly in the supply chain, we maintained positive momentum and continued progressing towards our volume targets. Given the continuously shifting market environment, we have decided to provide our production guidance as a range.

Adjusted EBITA was negative $632 million down, 12% driven mainly by gross margin pressure.

Growth margin for the quarter was negative 105%, reflecting a $54 million impact from Sterics alone. This impact accounted for a 21 percentage point decrease in growth margin, offsetting the benefits from sequential improvements in ASP.

While we anticipated this pressure.

We ended the quarter with $3 $6 billion in cash and investments and total liquidity of $4 $86 billion.

Our financial position remains strong providing us the runaway to fund operations and execute our long term plan.

We will actively take decisions and actions to move margins back towards a positive trajectory. These actions include material cost optimizations, improving production efficiency, and tighter inventory management.

Capex totaled $183 million consistent with our guidance and inventory rose to $713 million, reflecting lucid gravity production build and preparations for ramp up.

We also saw continued cost discipline across the organization while maintaining targeted investments in products and brands.

Looking forward, we are navigating an environment that remains volatile uneven we flagged earlier this year the potential impact of tariff related margin headwinds in the range of 8% to 15%.

Based on what we know to date.

The mitigation, we have already activated including the localized sourcing engineering substitution and vertical integration. We now believe the actual impact will fall at the lower end of that range. We are also continuing to manage exposure to magnet supply risks through a combination of supply.

R&D totaled $274 million for the quarter, reflecting higher spending on the midsize platform and Atlas powertrain. SG&A was $257 million. A sequential increase has spent normalized, following a one-time reversal of previously recognized stock-based compensation expense in the first quarter. Importantly, we are continuing to make deliberate trade-offs across the business, investing where it matters and streamlining where appropriate.

Adjusted EBITDA was negative $632 million, down 12%, driven mainly by gross margin pressure.

Diversification and in house reengineering.

Lessons learned during the lucid gravity ramp are informing our decisions as we prepare for the start of mid sized production in late 2026.

Found operations and execute how long-term plans?

And the policy front. Most of you are aware of the $7500 Elyse credit will be eliminated beginning in Q4 of this year. We have defined counter measures that will be implemented in Q3 to address this change.

To solve $183 million consistent with our guidance and inventory roles to $713 million, reflecting Lucid Gravity production builds and preparations for ramp-up.

In this next phase of our strategy will require us to scale with precision the mid size platform represents a critical opportunity to expand <unk> addressable market enhanced manufacturing leverage and offer a broader value proposition to customers without compromising on performance and efficiency we are applying.

Looking forward, we are navigating an environment that remains volatile and uneven. We flagged earlier this year the potential impact of Tiff-related margin headwinds in the range of 8% to 15% based on what we know today.

Everything we've learned from the lucid gravity to ensure this program comes to market with grid greater agility lower unit cost and shorter lead times. Lastly, we are updating our annual production guidance to a range of 18 to 20000 vehicles going forward, we will provide production guidance.

As a range to reflect the potential impact of constant with the changing market environment and external factors. We are refining our 2025 capex guidance to a range of $1 $1 billion to $1 2 billion.

This adjustment reflects a more focused investment approach prioritizing critical programs with the highest near term return and long term strategic value and de prioritizing lower return investments, we remain committed to funding future growth and all of the operational and strategic targets remain unchanged.

At the mitigations we have already activated, including localized sourcing, engineering substitutions, and vertical integration, we now believe the actual impact will fall at the lower end of that range. We are also continuing to manage exposure to magnets supply risks through a combination of supplier diversification and in-house reengineering. The lessons learned during the Lucid Gravity ramp are informing our decisions as we prepare for the start of midsize production in late 2026. On the policy front, most of you are aware that the $7,500 EV tax credit will be eliminated beginning in Q4 of this year. We have defined countermeasures that will be implemented in Q3 to address this change.

Sure.

Let me close with this accuracy, we are committed to building a great company not just a great product that means scaling responsibly investing wisely and staying laser focused on the fundamentals quality cost and capital discipline. We are operating in one of the most dynamic and competitive.

The stories of our time, what will distinguish the winners from the rest is not ambition alone, but execution and execution is what we are committed to thank.

Thank you for your continued belief in our mission and with that I'll turn it back to Nick to open the line for questions.

Thanks topic will now start the Q&A portion of the call before we take questions from those on the phone I want to pose questions that are retail investors and in through the <unk> technology platform.

This next phase of our strategy will require us to scale with precision. The midsize platform represents a critical opportunity to expand Lucid's addressable market, enhance manufacturing, leverage, and offer a broader value proposition to customers without compromising on performance and efficiency. We are applying everything we've learned from the Lucid Gravity to ensure this program comes to market with greater agility, lower unit costs, and shorter lead times. Lastly, we are updating our annual production guidance to a range of 18,000 to 20,000 vehicles going forward. We will provide production guidance as a range to reflect the potential impact of continuously changing market environments and external factors. We are refining our 2025 CAPEX guidance to a range of $1.1 billion to $1.2 billion. This adjustment reflects a more focused investment approach.

The first question comes from Sean <unk>.

How many current gravity orders are there.

We don't disclose the specific number of orders we've received however, as I referenced in my prepared remarks customers are now experiencing lucid gravity in our studios and we are seeing a high conversion rate once people see the vehicle for themselves.

Prioritizing critical programs with the highest near-term return and long-term strategic value, while deprioritizing lower-return investments. We remain committed to fostering future growth, and all other operational and strategic targets remain unchanged.

We are happy with what we're seeing and we remain supply constrained not demand constrained we expect the situation will normalize soon.

Our second question comes from policy is the mid size platform still on target for production in late 2026.

Our delivery is expected to start in 2026 for 2027.

And did the acquisition of the Nikola facilities allow mid size to be brought forward at all.

Let me close with this. We are committed to building a great company, not just a great product. That means scaling responsibly, investing wisely, and staying laser-focused on the fundamentals: quality, cost, and capital discipline. We are operating in one of the most dynamic and competitive industries of our time. What will distinguish the winners from the rest is not ambition alone, but execution. And execution is what we are committed to.

The mid size is still scheduled for start of production in late 2026, and we are planning to unveil the vehicle next year.

Thank you for your continued belief in our mission. And with that, I turn it back to Nick to open the line for questions.

Given the production start in late 2026, we expect deliveries to ramp up throughout 2027.

Next topic: we will not start the Q&A portion of the call.

Regarding the Nikola facilities.

While the facilities, we acquired bring it added capabilities they will not impact the timeline of our bed size vehicles.

Before we take questions from those on the phone, I want to address your questions that retail investors sent in through the Say Technologies platform. The first question comes from Sean B.

How many current Gravity orders are there?

Our third question comes from Adrian Day.

The partnership with Uber aid in company growth and how big of an impact do you expect it to have.

The strategic partnership with Uber and neuro is our entry into a large and very attractive market.

We don't disclose the specific number of orders we've received. However, as a reference in my prepared remarks, customers are now experiencing Lucid Gravity in our Studios, and we are seeing a high conversion rate once people see the vehicle for themselves.

As far as impact partnering with companies like Uber and neuro is another data point that validates lucid.

We are happy with what we're seeing, and we remain supply-constrained and not demand-constrained. We expect the situation will normalize soon.

Scalable platform and signals our right to win in new markets as we continue to pursue additional partnerships.

Our second question comes from Paul. C is the midsize platform. Still on target for production in late 2026.

This is the start of our path to extend our innovation and technology leadership into this multi trillion dollar market.

Our delivery is expected to start in 2026 or 2027.

And did the acquisition of the Nicolas facilities allow midsize to be brought forward at all?

Now I would like to take questions from the phone lines operator.

Thank you as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw your question Press Star One again, one moment, while we compile the Q&A roster.

The midsize is still scheduled for start of production in late 2026, and we are planning to unveil the vehicle next year.

Given that production starts in late 2026, we expect deliveries to ramp up throughout 2027.

Regarding the Niccolo facilities.

And our first question will come from the line of Andres Sheppard with Cantor Fitzgerald. Your line is open.

While the facilities we acquired bring added capabilities, they will not impact the timeline of our bit-size vehicles.

Hey, everyone. Good afternoon, and thank you so much for taking my questions congratulations on a quarter.

All of the partnerships with Uber, Aid, and company growth—how big of an impact do you expect it to have?

Quick question on ASP.

Just given the macro environment should we be expecting any changes to the midsized initial asp's as they ramp up.

The strategic partnership with Uber Neuro is our entry into a large and very attractive market.

It's rice.

Asps ramp up I think that is still some time out are you referring to gravity.

As far as the impact of partnering with companies like Uber, and Neuro is another data point that validates Lucid's highly scalable platform and signals our right to win in new markets as we continue to pursue additional partnerships.

So just on the mid size I know, we haven't we're not there yet, but just curious if the macro worsen if youre expecting any changes to initial asp's once it's available.

This is the start of our path to extend our innovation and technology leadership into this multi-trillion dollar market.

No.

Now, I would like to take questions from the phone lines, operator.

No I mean, there's no no plan.

No expectation that the ASP.

The mid size will be it will be impacted.

As a matter of fact, I mean, we have the current situation I personally and we as a company is seen as also as a temporary phase where we had a big hype, one evs and a couple of years ago and now there is more a <unk>.

Thank you. As a reminder, to ask a question, please press *1, then 1 again on your telephone and wait for your name to be announced to withdraw your question. Press *1 again, and one moment while we compile the Q&A roster.

And our first question will come from the line of Andres Shepard with Cancer Fitzgerald. Your line is open.

Slow down but.

We are fully convinced that eases the way forward and this will normalize over the next.

Yes.

Hey everyone, good afternoon, and thank you so much for taking our questions. Congratulations on the quarter. Hey, just a quick question on ASP. Just given the macro environment, should we be expecting any changes to the midsize initial aspects as they ramp up? Thanks.

Got it that's very helpful. Thank you and just as a follow up.

Maybe first can you just remind us the plans regarding the 2026 convertible that's coming up like remind us how you're planning on addressing I think the remaining 900 or so million that's left.

Besides, uh, ASP is ramped up. I think that is, uh, still some time out. Are you referring to gravity?

Yeah, Hi, Andreas.

I mean, the plan is still I think we touched quickly on it last time, we spoke.

No, just on the missiles. I know we have an, and we're not there yet, but just curious if, you know, as the macro worsens, if you're expecting any changes to initial ASPs once it's available.

No.

The plan is still to go to the market.

In the next coming quarters. So I mean, there is no no change to that so obviously were.

No. I mean, there's there's no no plan. Uh and then no expectation that the ASV of of the midsize will be will be impacted.

Hopefully monitoring the market situation in order to take advantage of the best conditions, So, but it's something that for the moment, we're planning for towards the end of 2025 early 2026.

Wonderful. Thank you so much congrats again.

Thank you Andreas.

As a matter of fact, I mean, we have the, the current situation. Um, I personally and, and we, as a company, see this also as a, a temporary phase where, you know, we had a big hype on, um, EVS, you know, a couple of years ago. And now there's more a, uh, you know, a Slowdown. But, uh, you know, we are fully convinced that, you know, EVS is the way forward and, you know, this will normalize over the next. Uh, yeah. Years

One moment for our next question.

And that will come from the line of Stephen <unk> with Stifel. Your line is open.

Mr. <unk>, if you're on mute please UN mute your line.

Got it. That's very helpful. Thank you. And just as a follow-up, um, maybe for Taoufiq, can you just remind us of the plans regarding the 2026 convertible that's uh, coming up? Like, remind us how you're planning on addressing, I think, the remaining $900 million or so that's left. Thanks.

Okay, sorry about that.

You're probably sick thanks for taking the questions.

What I would like to start with if you don't mind is can you talk about the approach the current approach and a change to licensing agreements.

And kind of what you see the potential therefore over the next couple of years.

Yeah.

I mean actually the comment on that one would not change has not changed compared to what I said three months ago, because we have still ongoing discussions on that topic most of the other Oems.

Yeah, hi Andreas. Uh, so I mean the plan is still, I think we, we, we touched quickly on it. Last time we spoke. I mean, the the, the plan is still to, to go to the market, uh, in the next coming quarters. So, uh, I mean, there's no, no change to that. So, obviously, we're carefully monitoring, uh, the market situation in order to to, to take advantage of the best, uh, conditions so, uh, but it's something that, uh, for the moment we're planning for, uh, towards the end of 2025, early 2026,

Talking to.

They have other problems right now.

Wonderful, thank you so much. Congrats again, I'll pass it.

There are still very much focused on the grappling with the.

Thank you, Andres.

1 moment for our next question.

Tariff effect and those kind of things and so.

The discussions are still happening, they're just progressing slower and we still see the potential in those in those deals, but as I said the last China.

Steve, your line is open.

Mr. Gengaro, if you're on mute, please unmute your line.

No.

Awesome.

Yeah.

Background noise there.

But we also have now discussions on partnerships beyond this topic at the end of this.

The new ROA and <unk>.

One example of that and Thats now what we are expecting to come to fruition more in the future as well.

Great. Thank you and I apologize for the background noise.

Okay, sorry about that. I, uh, I hear you by mistake. Thanks for taking the questions. Um, what I would like to start with, if you don't mind, is can you talk about the approach? The current approach and how it has changed to licensing agreements, and what you see the potential there for over the next couple of years?

The other question.

Yes.

The update on <unk>.

How the new Atlas powertrain is coming.

And sort of your confidence.

And the development of that and the efficiency of that product versus kind of because you're just so well known for how efficient.

The motor systems, or I'm, just curious where things stand there.

Yes on track I mean face to face short because obviously this is our next generation powertrains that we will achieve or we are targeting to achieve the same efficiency were even better at a much lower cost so.

We are fully on track with that at this point and looking very much forward to deploy this in the mid size platform is the first vehicles.

But as I said last time, would you like that? No, thanks. No.

Background noise there. Um,

Great. Thank you Mark.

One moment for our next question.

And that will come from the line of James <unk> with BNP Paribas. Your line is open.

So, but we also have discussions and partnerships beyond this topic. And, you know, this is, uh, the Neural and Uber deal, which is one example of that. And that's now what we are expecting to come to fruition more in the future as well.

Hi, guys. This is Jake on for James.

I was wondering if you could just quantify gravity deliveries in the second quarter.

And based on third party data out which is admittedly unreliable for Blue said there were no deliveries in July.

Is there a hang up.

Like quality issue with the graph the delivery ramp and when should we expect to see material volumes.

Yeah, well, let me let me address July 1st that number is false.

Great, thank you. And I apologize for that background noise. The the the other question, um, just the the update on how the new Atlas powertrain is coming, uh, and sort of your, your, your confidence in in the development of that and the efficiency of that product versus kind of, because you're just so well known for how efficient that the, uh, the motor systems are so just curious where things stand there.

That's all I wanted to see about that it's totally volt.

But when it comes to number four our second half we're not disclosing this but we're definitely in the process right now of ramping up gravity in the second half of this year. The gravities will actually be the majority of our deliveries, but yeah going back to the July number we saw that as well but.

Yeah um, on track, I mean to say to say it short because obviously this is our next Generation, our train that will achieve or we're talking to achieve um, the same efficiency or even better at a much lower cost. So um, we are we are fully on track with that at this point and yeah, looking very much forward to deploy this in the midsize platform as as the first vehicle.

It's unfortunate that something like that is established.

Great. Thank you, Mark.

1 moment for our next question.

Okay. Thanks for clarifying on that.

Then capex.

An area, where I think you guys have done a good job controlling our costs keep them under expectation, but even the revised guide it looks like you're implying spending will more than double in the second half. So could you just talk through some puts and takes there. Thank you.

And that will come from the line of James Parilya with BNP Paribas. Your line is open.

Well I mean.

You can imagine I mean, when it comes to the Capex spend is not linear exercise. So I mean between the moment you place. Your appeals you finalize all the the blueprint and so forth I mean, there is a lack of time. So this is why I mean, we see our capex, which is which is back loaded so most.

Hi guys, this is Jake on for James. Um, I was wondering if you could just quantify Gravity deliveries in the second quarter. Based on third-party data, which is admittedly unreliable for Lucid, there were no deliveries in July. So, is there a hang-up? Uh, you know, like a quality issue with the Gravity delivery ramp, and when should we expect to see material volumes?

The spend will be related to our <unk> facility.

And KSA. So again, it's not a linear spend than what we have tried to do is to had to have a critical look at all the capex spend proposal.

Make sure that we only spend where he deserves to be spent with the highest probability of return at the highest level of return enhanced the revised guidance that we have provided but again, yes, I mean, most of the spend will happen in the second half of the year.

Yeah, well, let me let me address 2 live first. That number is false, uh, and that's all I want to say about that, it's totally false. Uh, but when it comes to, uh, number for second half, we're not disclosing this, but we're definitely in the process right now of of ramping up gravity and the second half of this year, the gravities will actually be the, the majority of our deliveries. But yeah, going back to the July number, we saw that as well, but uh, yeah, it's unfortunate that something like this is published.

Yeah, thanks for clarifying on that. Um, and then capex is an area where I think you guys have done a good job controlling your costs, keeping it under expectations.

Thanks, guys.

Thank you as a reminder, if you would like to ask a question. Please press star one one our next question will come from the line of Tobias.

But even in the revised guide, it looks like you're implying spending will more than double in the second half. So, could you just talk through some of the puts and takes there? Thank you.

Rothschild your line is open.

Hi, good evening, Mark to help keep us well thanks for your time.

Three questions. If that's okay, mark on onset to kick in and I'll ask them separately.

Mark.

The prepared remarks, you sighted the supply of magnets is constraining production.

But I'll put it in the second quarter was at an all time high.

And also above demand.

And I also understand the gravity and the user Sanomat magnets.

Confused and I was wondering if I can ask upset the details on that topic of you can if you can tell me what I've missed.

Yeah, well first of all.

The problem is behind us so we solve that problem in Q2 second half of the year.

Well, I mean, uh, as as you can imagine, I mean, when it comes to the capex spend, it's not a linear exercise. So, I mean, between the moment, you place your pose, you finalize all the, the blueprints, and so forth. I mean, there's a lag of time. So this is why, I mean, we see a capex which is, uh, which is back loaded. So most of the spent uh will be related to our uh amp to facility uh in uh in KSA. So again it's not a linear spend, and what we have tried to do is, uh, to had to have a critical look at all, the capex spent proposal and make sure that, uh, we only spend where it deserves to be spent with the highest probability of return and the highest level of return, hence, the revised guidance that, uh, that we have provided. But again, yes, I mean, most of the spent will happen in the second half of the year.

We have secured enough magnets. So we have no problem with that anymore. When it comes to your second part.

Thanks guys.

The gravity in the air use the same magnitude thats actually not exactly true.

Thank you. As a reminder, if you would like to ask a question, please press *1 1. Our next question will come from the line of Tobias Bass with Rothschild. Your line is open.

Because what happens is taking over from each model year and from each module, we have minor changes in the chemical.

Setup of the magnets and those kind of things so that is not not really correct. Yeah. So we had.

Hi, good evening. Welcome to feet. I hope you both are well, and thanks for your time. I have three questions, if that's okay. Um, two for Mark and one for Peter. I'll ask them separately.

The shortfall for a certain trim.

Mark, in your prepared remarks, you said that the supply of magnets is constraining production.

And we were able to overcome this with some.

Some magic I would call it that our engineering teams.

We're able to do it.

We actually did.

This production.

Due to that in Q2.

And yes.

Helped us over that hump.

But output in the second quarter was at an all-time high and also above demand. And I also understand that gravity in the air uses the same amount of magnets. So it sounds slightly confused, and I was wondering if I can ask for further details on that topic or if you can tell me what I've missed.

Okay, I think I haven't stopped.

Second question for Mark back to.

Two years ago asked your predecessor detailed the timeline and the required milestones.

Then to starting production of the gravity to help me judge progressed from the outside.

Was wondering if you could change that the same for the Atlas powertrain and the first model based on the past hustle.

Okay.

Yes, I mean right now.

One key thing that we're doing is basically we're in sourcing right now and if you see what I'm, saying right now applies to the powertrain.

Powertrain, but also to the midsize so theres not really a difference because both of them will comment at the same time.

Then in sourcing is important because we are sourcing right now for the so called <unk>, which has been the product validation builds so all of the engineering work will be.

We have secured enough magnets so we have no, no problem with with that anymore when it comes to your your second part uh that, you know, the gravity and the air use the same magnets that actually not exactly true. Uh, because what happens is that over from each model here and from each model we have minor changes in the the chemical uh, you know, setup of of the magnets and and those kind of things. So that is not not really correct. Yeah. So we had, uh, a a shortfall for a certain trim and we were able to overcome this with a. Yeah, some magic. I would call it that our engineering teams, uh, then were able to do.

Very quickly be finalized and then from there we go into the validation phase.

So we actually didn't. Yeah, this production, uh, due to that in Q2. Um, and yeah, that helped us over that hump.

And all kinds of testing, including winter testing later in the year and then Homologation. So those are the things that are following I guess the background of the question is are we on track with what we planned to start the production of the mid sized in the end of 2026 and the answer to that this is our current plan.

Okay.

I think I understand.

Question for Mark.

Your predecessor detailed the timeline and the required milestones from them to starting production at the Gravity, to help me judge progress from the outside.

Has not changed.

Okay.

Thanks for that.

I was wondering if you could, please do the same for the Atlas powertrain and the first model based on the mid-size platform.

Final question from me.

How much destocking the breakdowns on inventories.

Losses on some purchase commitments is attributable to tariffs, that's just building raw inventory tight the ramp up of the property.

Yeah. So.

Again first of all yes, there is an impact on inventory adjustment on inventory for the next six months commitment of purchases.

As far as we see it I mean.

In the event, which will hit primarily Q2 because for the subsequent quarters I mean, we will need to do a reversal, which will offset the new provision that we will book provided that we maintained roughly an equivalent volume of procurements. So knowing that we have acquired and we did.

The increase in our inventory in Q2, we should expect the volumes to remain roughly stable in Q3, and Q4 and therefore, it will not revise any incremental impairment that we might have to book so.

Yeah, I mean, uh, right now 1 key thing that we're doing is basically, uh, we're in in sourcing right now and it's basically what I'm saying right now applies to the atlas powertrain, but also to, uh, the midsize. So there's not really a difference because both of them will, will will come at at the same time, um, then sourcing is important because we are, you know, searching right now for the So-Cal, PV builds, which is where the, the product validation builds, so all of the engineering work, will, you know, be very quickly be finalized and then from there, we go into a validation phase, uh, with all kinds of testing, including winter testing later in the year. And uh, then homologation. So those are the things that are are following. I guess the the background of the question is, are we on track with what we planned? You know, to start the production of the midsize? In the the end of 2026 and the answer to that? This is our current plan has not changed.

We have.

<unk> stated that the tariffs the impact from the tariffs in Q2 was amounting to roughly $55 million. So this is actually a net figure which is made of three.

For that piece, final question from me. Um, how much of the step up in the write-downs on inventories and losses on firm purchase commitments is attributable to tariffs versus building raw inventory to aid the ramp-up of the Gravity?

Three different amounts the first one is the actual tariff impact.

Which is in the range of $55 million. Then there is the impairment that we book only in Q2 and then there is <unk>.

Netting effect coming from the reimbursements.

That we are getting the famous 375% debt that we're getting so all this leading to a net.

<unk> 55 plus million dollars for the quarter.

Okay.

Just Tom just some crystal clear.

21 points of tariff impact, but not all of it was actually realized in the second quarter.

And do you still expect some reinvestments to come later in the talk.

Actually the impact from the second quarter was more than 21%.

So.

Yeah. So, um, again, first of all, yes, there is an impact on inventory adjustment on inventory for the next 6 months, commitment of purchases. It's, uh, as far as we see it, I mean, uh, an event which will hit primarily Q2 because for the subsequent quarters, I mean we will need to do a reverse, so which will offset the new provision that we will book provided that we maintain roughly, uh, an equivalent volume of procurement. So, knowing that we have acquired, and we did an increase in our inventory in Q2, we should expect the volumes to remain, uh, roughly, uh, stable in Q3 and Q4. And therefore, it will not rise any incremental impairment that, uh, we might have, uh, to book. So, uh, we have, uh, uh, stated that the tariffs, uh, the impact from the tariffs, uh, in Q2.

No no no I mean, we will have reimbursement for this will continue it's a flat percentage, which is function of the localization of the procurement activity and the volumes for this will continue.

Until the end of the year, the only difference that will not happen on the element, which will not happen nor will not have an impact on our financial for the balance of the year is the booking of the impairment of the inventory because this will be netted off between reversal and provision that we book So thats why when you look at the.

The statement that we have or the guidance that we have given we are saying that.

This impact on a full year basis will be on the lower end.

Was the mounting to, uh, roughly 55, uh, million, uh, dollars. So this is, uh, actually uh, a net figure, which is made, uh, of, uh, 3, uh, different uh, amounts. The first 1 is the actual tariff impact, uh, which is in the range of 55 million. Then there is the impairment that we booked only in Q2, and then there's, uh, a netting effect coming from, uh, the reimbursements. Uh, that we're getting the famous 3.75% that that we getting. So all these leading to a net, uh, 50 555 plus, uh, million dollars for the quarter.

What we have provided so we said 8% to 15% on a full year basis, we have 21% in Q2, primarily because we had to book the first impairment on inventories that will not happen for the subsequent quarters.

Okay, so just, um, just some crystal clear at the 21st impact.

Not all of it was actually realized in the second quarter.

And you're still expecting some reimbursements to come later in the year. So, actually, the impact on the second quarter was more than 21%.

Okay understood I appreciate the detail complexity actually patents.

Thank you.

Thank you I'm showing no further questions in the queue at this time.

Lucid second quarter of 2025 earnings conference call. Thank you all for joining US today and you may now disconnect.

Percentage, which is a function of the localization of the procurement activity and the volumes. So this will continue.

Until the end of the year, the only difference that will not happen or the only elements which will not happen or will not have an impact on our financial for the balance of the year, is the booking of the impairment of the inventory, because this will be netted off between reversal and provision that we booked. So that's why when you look at, uh, the the statement that we have or the uh, guidance that we have given, we are saying that uh, the Tariff impact on a full year basis will be on the lower end of what we have provided. So we said 8 to 15% on a full year basis. We have 21% in Q2 primarily because we had to book the first impairment on inventories that will not happen for the subsequent quarters.

Okay, understood. I really appreciate the details from both of you. Thanks for your time.

Thank you.

Thank you. I'm showing no further questions in the queue at this time. This concludes Lucid's second quarter of 2025 earnings conference call. Thank you all for joining us today, and you may now disconnect.

Ladies and gentlemen, thank you for standing by, and welcome to the Lucid Group Q2 2025 earnings conference call.

Please be advised that today's conference is being recorded. Later, we will conduct a question-and-answer session. If you have a question, please press *1 1 on your touchtone telephone.

I would now like to turn the conference over to our speaker for today, Nick Torque, Vice President of Communications. Please go ahead.

Thank you, and welcome to Lucid Group's second quarter 2025 earnings call.

Joining me today are Marc Winterhoff, our interim CEO, and Tai R, CFO.

Before handing the call over to Mark, let me remind you that some of the statements on this call include forward-looking statements under Federal Securities Law. These include, with all limitations, statements regarding the future financial performance of the company, production and delivery volumes of vehicles and products, studios and services networks, financial and operating outlook and guidance, macroeconomic policy and industry trends, tariffs and trade policy, company initiatives, and other future events.

These statements are based on various assumptions, whether or not identified in this communication, and on the predictions and expectations of our management as of today.

Actual events are results that are difficult or impossible to predict and may differ due to a number of risks and uncertainties.

Reports on Form 10-Q and current reports on Form 8-K. It's another SEC filing.

And the forward-looking statements on page 2 of our quarterly earnings presentation, available on the Investor Relations section of our website at IR.lucidmotors.com. We undertake no obligation to revise or update publicly any forward-looking statement for any reason except as required by law.

In addition, management will make reference to non-GAAP financial measures during this call. A discussion of why we use non-GAAP financial measures and information regarding reconciliation of our GAAP versus non-GAAP results is available in our earnings press release issued earlier this afternoon, as well as in the earnings presentation.

With that, I'd like to turn the call over to Lucid's interim CEO, Marc Winterhoff. Marc, please go ahead.

Thank you, Nick.

And thank you, everyone, for joining us in our second quarter 2025 earnings call.

I'd like to begin by expressing my sincere appreciation to our employees, customers, partners, and shareholders. Your continued belief in our mission is what drives us forward every day.

In the second quarter of 2025, we achieved meaningful progress on both operational and strategic fronts.

We delivered 339 vehicles, up 38% year-over-year.

And our sixth consecutive quarter of record deliveries.

We produced 3,863 vehicles, representing an 83% year-over-year increase.

As expected, ASP increased sequentially this quarter due to an improved mix. However, gross margin was negatively impacted by tariffs.

As to FAL detail in his remarks.

First, we've been sharing with you that we are in active discussions about partnerships beyond selling or licensing our industry-leading EV technology.

On July 17th, we took a big step in this direction with the announcement of a partnership with Uber and Gyro on a next-generation premium robot taxi created specifically for the youths on Uber's ride-hailing platform.