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Lucid stock caps big week despite bankruptcy report
Shares rise 14% on July 17 after a sharp sell-off tied to a trade publication report
Attendees visit the Lucid Motors booth at the IAA Mobility 2025 expo in Munich on Sept. 9. (Alex Kraus/Bloomberg)
Key Takeaways:
- Lucid shares rose 14% July 17, extending a three-day rebound to 60% after the electric vehicle maker denied considering bankruptcy.
- Lucid remains heavily unprofitable, while its shares have fallen almost 80% in the past year despite over $9 billion in Saudi backing.
- Bloomberg Intelligence analyst Eric Varghese said Lucid must execute its midsize launch to broaden demand and improve its path to profitability.
Lucid Group Inc., the electric vehicle maker, said it isn’t considering a bankruptcy, and so far, the market believes it.
Shares of the Saudi-backed company rose 14% on July 17 and notched their largest weekly advance in a year. The rally followed a July 14 plunge, which occurred after a trade publication report circulated that the company was considering a bankruptcy filing.
Lucid stock sold off as much as 57%, an intraday record drop. It ended down 16% after the company confirmed that it is working with restructuring firm AlixPartners but said the report that it is considering bankruptcy is “completely false.”
Shares have jumped 60% over the subsequent three days and closed at $7.35 on July 17, higher than the July 20 pre-selloff close of $5.51.
“The company is still heavily loss-making, so investor sentiment can shift very quickly,” said Bloomberg Intelligence contributing analyst Eric Varghese. “Bankruptcy is a serious topic for Lucid given its ongoing losses and cash burn, but the company’s denial and legal pushback against the report seem to have taken some pressure off the stock.”
The last time Lucid saw a more robust week of gains was in July 2025. Shares surged 33% in just five days after rideshare titan Uber Technologies — which holds nearly 10% of Lucid stock — announced that it would partner with the EV firm and self-driving tech startup Nuro Inc. to assemble a fleet of 20,000 robotaxis.
In the year since, Lucid shares have sunk almost 80%, compared with an increase of 35% and 19%, respectively, for EV company rivals Rivian Automotive and Tesla Inc. Of the stock’s 14 analysts, only Citi’s Michael Ward recommends purchasing it, according to data compiled by Bloomberg.
“I’m surprised to the extent it’s recovered,” said Chris Pierce, an analyst at Needham who has a hold rating on the company. He added that once the bankruptcy term gets attached to a company, even one that’s denied it, “it’s hard to put the toothpaste back in the tube.”
The hits have come as Lucid has overhauled its management, cut thousands of jobs, and struggled to sell cars. Its top shareholder, the Saudi Public Investment Fund, has poured over $9 billion into Lucid, but the PIF has soured on unprofitable ventures before, including the controversial LIV Golf circuit.
“The bigger issue has not gone away: Lucid is still in a tough spot and needs to execute well on the midsize launch to broaden demand and improve its path to profitability,” Varghese said.
