What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-25 compared with 2024-02-27 · 635 added, 447 removed, 1108 unchanged (49% of the section changed)

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Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 202 4 , 202 3 and 202 2

Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) for the years ended December 31, 202 3 , 202 2 and 202 1

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity for the years ended December 31, 202 4 , 202 3 and 202 2

Consolidated Statements of Cash Flows for the years ended December 31, 202 4 , 202 3 and 202 2

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Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheet of Lucid Group, Inc.

and subsidiaries (the Company) as of December 31, 2023, the related consolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ equity (deficit), and cash flows for the year then ended, and the related notes (collectively, the consolidated financial statements).

We have audited the accompanying consolidated balance sheets of Lucid Group, Inc.

and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, redeemable convertible preferred stock and stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year then ended, in conformity with U.S.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with U.S.

generally accepted accounting principles.

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Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Evaluation of net realizable value of certain inventories

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For certain inventories, we also evaluated the estimated cost to convert inventory on-hand by comparing the historical estimated cost to convert to actual results.

Evaluation of redeemable convertible preferred stock issuances

As discussed in Notes 2, 8 and 16 to the consolidated financial statements, in March 2024, the Company entered into the Series A Subscription Agreement with a related party.

Pursuant to the Series A Subscription Agreement, the related party purchased 100,000 shares of the Series A Redeemable Convertible Preferred Stock for an aggregate purchase price of $1.0 billion in a private placement.

In addition, in August 2024, the Company entered into the Series B Subscription Agreement with the same related party.

Pursuant to the Series B Subscription Agreement, the related party purchased 75,000 shares of the Series B Redeemable Convertible Preferred Stock for an aggregate purchase price of $750.0 million in a private placement.

The Series A Redeemable Convertible Preferred Stock and the Series B Redeemable Convertible Preferred Stock (the Redeemable Convertible Preferred Stock) are convertible at the option of the holder (i) at any time the closing price per share of the common stock on the trading date immediately preceding the date on which the holder delivers the relevant notice of conversion is at least a certain price threshold or (ii) during specified periods preceding a fundamental change or optional redemption by the Company under the terms of the Redeemable Convertible Preferred Stock.

As of December 31, 2024, the Redeemable Convertible Preferred Stock mezzanine equity and derivative liabilities were $1.3 billion and $639.4 million, respectively.

We identified the assessment of the initial US GAAP accounting treatment of the Redeemable Convertible Preferred Stock as a critical audit matter.

Specifically, the evaluation of the appropriate accounting treatment, including:

1) determination of whether the preferred stock was a debt or equity host, 2) identification of the embedded features, and 3) determination of whether any of the embedded features require bifurcation and separate accounting, involved complex, challenging and subjective auditor judgments.

In addition, a high degree of auditor judgment was involved in determining the nature and extent of the procedures performed and audit evidence obtained to evaluate the Company's conclusions.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of an internal control related to the initial accounting treatment of the Redeemable Convertible Preferred Stock.

We obtained and reviewed the Redeemable Convertible Preferred Stock agreements to understand the terms, conditions, and features within the agreements to assist in (i) evaluating relevant contract terms and conditions of the agreements in relation to the appropriate accounting literature, (ii) comparing the relevant terms and provisions to management’s analysis, and (iii) assessing the appropriateness of conclusions reached by the Company with respect to the initial accounting treatment, including the determination of the host contract, and identification and bifurcation of embedded features within the Redeemable Convertible Preferred Stock.

We evaluated the conclusions made by the Company related to the accounting treatment for issuance of the Redeemable Convertible Preferred Stock, including the Company’s conclusions of relevant accounting standards to analyze and assess the identification and determination of embedded features requiring bifurcation and separate accounting of the Redeemable Convertible Preferred Stock.

We have served as the Company’s auditor since 2023.

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Opinion on the financial statements

We have audited the accompanying consolidated balance sheet of Lucid Group, Inc.

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2022, the related consolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ equity (deficit), and cash flows for each of the two years in the period ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have audited the consolidated balance sheet of Lucid Group, Inc.

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2022 (not presented herein), the related consolidated statements of operations and comprehensive loss, redeemable convertible preferred stock and stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of its operations and its cash flows for the year ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Basis for opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ GRANT THORNTON LLP

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San Francisco, California

February 28, 2023

February 28, 2023 (except for Note 17, as to which the date is February 25, 2025)

LUCID GROUP, INC.

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Cash and cash equivalents $ 1,606,865 $ 1,369,947

Short-term investments 2,489,798 2,177,231

Accounts receivable, net 51,822 19,542

Short-term investments (including $ 15,000 and nil associated with a related party as of December 31, 2024 and 2023, respectively)

2,424,103 2,489,798

Accounts receivable, net (including $ 57,909 and $ 35,526 from a related party as of December 31, 2024 and 2023, respectively)

112,025 51,822

Inventory 407,774 696,236

Prepaid expenses 52,951 69,682

Other current assets 79,670 81,541

Other current assets (including $ 34,503 and nil associated with a related party as of December 31, 2024 and 2023, respectively)

270,218 79,670

Total current assets 4,873,936 4,757,155

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Right-of-use assets 211,886 221,508

Long-term investments 461,029 529,974

Long-term investments (including $ 20,000 and nil associated with a related party as of December 31, 2024 and 2023, respectively)

1,012,223 461,029

Other noncurrent assets 249,443 180,626

Investments in equity securities of a related party 37,831 81,533

TOTAL ASSETS $ 9,647,931 $ 8,512,718

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Accounts payable $ 133,832 $ 108,724

Accrued compensation 92,494 63,322

Finance lease liabilities, current portion 6,788 8,202

Other current liabilities 798,990 634,567

Other current liabilities (including $ 126,417 and $ 92,258 associated with related parties as of December 31, 2024 and 2023, respectively)

1,024,671 891,484

Total current liabilities 1,165,291 1,008,410

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Long-term debt 2,002,151 1,996,960

Other long-term liabilities 524,339 378,212

Other long-term liabilities (including $ 121,136 and $ 178,311 associated with related parties as of December 31, 2024 and 2023, respectively)

572,800 524,339

Derivative liabilities associated with redeemable convertible preferred stock (related party) 639,425 —

Total liabilities 4,475,277 3,661,026

Commitments and contingencies (Note 12)

REDEEMABLE CONVERTIBLE PREFERRED STOCK

Preferred stock 10,000,000 shares authorized as of December 31, 2024 and 2023, Series A redeemable convertible preferred stock, par value $ 0.0001 ;

100,000 and 0 shares issued and outstanding as of December 31, 2024 and 2023, respectively;

liquidation preference of $ 1,138,825 and nil as of December 31, 2024 and 2023, respectively (related party)

Preferred stock 10,000,000 shares authorized as of December 31, 2024 and 2023, Series B redeemable convertible preferred stock, par value $ 0.0001 ;

75,000 and 0 shares issued and outstanding as of December 31, 2024 and 2023, respectively;

liquidation preference of $ 800,442 and nil as of December 31, 2024 and 2023, respectively (related party)

Total redeemable convertible preferred stock 1,299,842 —

STOCKHOLDERS’ EQUITY

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Total stockholders’ equity 3,872,812 4,851,692

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

TOTAL LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

$ 9,647,931 $ 8,512,718

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2024 2023 2022

Revenue $ 595,271 $ 608,181 $ 27,111

Revenue (including $ 174,204 , $ 43,714 , and nil from a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

$ 807,832 $ 595,271 $ 608,181

Costs and expenses

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Restructuring charges

20,304 24,546 —

Total cost and expenses 3,828,652 3,694,859 3,202,172

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Other income (expense), net

Change in fair value of forward contracts — — ( 454,546 )

Change in fair value of convertible preferred stock warrant liability — — ( 6,976 )

Change in fair value of common stock warrant liability 34,150 86,926 1,254,218

Change in fair value of equity securities

Transaction costs expensed — — ( 2,717 )

Change in fair value of equity securities of a related party

( 43,057 ) 5,999 —

Change in fair value of derivative liabilities associated with redeemable convertible preferred stock (related party)

Interest income 213,026 204,274 56,756

Interest expense ( 24,915 ) ( 30,596 ) ( 1,374 )

Interest expense (including $ 6,980 , $ 2,159 , and $ 283 to a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

( 32,923 ) ( 24,915 ) ( 30,596 )

Other income (expense), net ( 18,469 ) ( 90 ) 9,532

Total other income (expense), net 272,194 1,289,910 ( 1,049,266 )

Total other income, net

308,077 272,194 1,289,910

Loss before provision for income taxes

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Provision for income taxes

1,199 1,026 379

Net loss ( 2,713,942 ) ( 2,828,420 ) ( 1,304,460 )

Deemed dividend related to the issuance of Series E convertible preferred stock — — ( 2,167,332 )

Accretion of redeemable convertible preferred stock (related party)

( 347,610 ) — —

Net loss attributable to common stockholders, basic ( 3,061,552 ) ( 2,828,420 ) ( 1,304,460 )

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Comprehensive loss ( 2,720,891 ) ( 2,811,998 ) ( 1,316,032 )

Deemed dividend related to the issuance of Series E convertible preferred stock — — ( 2,167,332 )

Accretion of redeemable convertible preferred stock (related party)

( 347,610 ) — —

Comprehensive loss attributable to common stockholders $ ( 3,068,501 ) $ ( 2,811,998 ) $ ( 1,316,032 )

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LUCID GROUP, INC.

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND

STOCKHOLDERS’ EQUITY (DEFICIT)

CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

(in thousands, except share data)

Preferred Stock Common Stock Additional

Redeemable Convertible

Preferred Stock

Common Stock Additional

Capital Treasury Stock Accumulated

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Stockholders’

Equity (Deficit)

Amount Shares

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Net loss — — — — — — — ( 1,304,460 ) ( 1,304,460 )

Repurchase of Series B convertible preferred stock ( 3,525,365 ) — — — — — — — —

Issuance of Series D convertible preferred stock upon exercise of warrants 1,546,799 12,936 — — — — — — —

Issuance of Series E convertible preferred stock 200,728,229 3,206,159 — — ( 22,395 ) — — ( 2,129,218 ) ( 2,151,613 )

Stock-based compensation related to Series E convertible preferred stock — 123,614 — — — — — — —

Conversion of convertible preferred stock into common stock in connection with the reverse recapitalization ( 1,155,909,367 ) ( 5,836,785 ) 1,155,909,367 116 5,836,669 — — — 5,836,785

Issuance of common stock and common stock warrants upon the reverse recapitalization, net of issuance costs — — 425,395,023 42 3,590,914 — — — 3,590,956

Other comprehensive loss — — — — — — ( 11,572 ) — ( 11,572 )

Tax withholding payments for net settlement of employee awards — — — — ( 218,789 ) — — — ( 218,789 )

Treasury stock repurchase — — ( 857,825 ) — — ( 20,716 ) — — ( 20,716 )

Issuance of common stock upon vesting of employee RSUs — — 15,217,096 1 ( 1 ) — — — —

Issuance of common stock upon exercise of common stock warrants — — 26,640,121 3 173,270 — — — 173,273

Redemption of public warrants — — — — ( 4 ) — — — ( 4 )

Issuance of common stock under employee stock purchase plan — — 2,106,158 — 24,562 — — — 24,562

Issuance of common stock upon exercise of stock options — — 22,519,879 2 17,786 — — — 17,788

Issuance of common stock under At-the-Market Offering, net of issuance costs — — 56,203,334 6 594,311 — — — 594,317

Issuance of common stock under 2022 Subscription Agreement (related party)

— — 85,712,679 9 914,991 — — — 915,000

Stock-based compensation — — — — 423,500 — — — 423,500

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Net loss — — — — — — — ( 2,828,420 ) ( 2,828,420 )

Other comprehensive loss

— — — — — — ( 11,572 ) — ( 11,572 )

Other comprehensive income — — — — — — 16,422 — 16,422

Tax withholding payments for net settlement of employee awards — — — — ( 17,615 ) — — — ( 17,615 )

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Issuance of common stock upon exercise of stock options — — 9,003,642 1 10,342 — — — 10,343

Issuance of common stock under At-the-Market Offering, net of issuance costs — — 56,203,334 6 594,311 — — — 594,317

Issuance of common stock under 2022 Subscription Agreement

Issuance of common stock under 2023 Underwriting Agreement, net of issuance costs

— — 173,544,948 17 1,184,207 — — — 1,184,224

Issuance of common stock under 2023 Subscription Agreement, net of issuance costs (related party)

— — 265,693,703 27 1,812,614 — — — 1,812,641

Stock-based compensation — — — — 300,560 — — — 300,560

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Net loss — — — — — — — ( 2,713,942 ) ( 2,713,942 )

Other comprehensive income

Other comprehensive loss

— — — — — — ( 6,949 ) — ( 6,949 )

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Issuance of common stock under 2024 Underwriting Agreement, net of issuance costs

Issuance of common stock under 2023 Subscription Agreement, net of issuance costs — — 265,693,703 27 1,812,614 — — — 1,812,641

— — 277,484,525 28 718,329 — — — 718,357

Issuance of common stock under 2024 Subscription Agreement, net of issuance costs (related party)

— — 396,188,386 40 1,025,620 — — — 1,025,660

Issuance of Series A redeemable convertible preferred stock, net of derivative liability and issuance costs (related party) 100,000 500,549 — — — — — — —

Issuance of Series B redeemable convertible preferred stock, net of derivative liability and issuance costs (related party) 75,000 451,683 — — — — — — —

Accretion of redeemable convertible preferred stock (related party) — 347,610 — — ( 347,610 ) — — — ( 347,610 )

Stock-based compensation — — — — 331,534 — — — 331,534

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The accompanying notes are an integral part of these consolidated financial statements.

______________________________________________________________

(1) The number of shares of convertible preferred stock and common stock issued and outstanding prior to the Merger have been retroactively adjusted by the Exchange Ratio (as defined in Note 4 “Reverse Recapitalization”) to give effect to the reverse recapitalization treatment of the Merger.

See Note 1 “Description of Business” and Note 4 “Reverse Capitalization” for more information.

LUCID GROUP, INC.

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Inventory and firm purchase commitments write-downs 590,198 906,069 569,479

Change in fair value of contingent forward contract liability — — 454,546

Change in fair value of preferred stock warrant liability — — 6,976

Change in fair value of common stock warrant liability ( 34,150 ) ( 86,926 ) ( 1,254,218 )

Net accretion of investment discounts/premiums

Change in fair value of equity securities of a related party

43,057 ( 5,999 ) —

Change in fair value of equity securities

Change in fair value of derivative liabilities associated with redeemable convertible preferred stock (related party)

( 155,350 ) — —

Net accretion of investment discounts/premiums

( 76,739 ) ( 105,432 ) ( 20,695 )

Other non-cash items 5,983 34,205 10,353

Changes in operating assets and liabilities:

Accounts receivable ( 32,509 ) ( 16,498 ) ( 2,888 )

Accounts receivable (including $( 22,383 ), $( 35,526 ), and nil from a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

( 61,279 ) ( 32,509 ) ( 16,498 )

Inventory ( 334,242 ) ( 658,010 ) ( 1,256,349 )

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Accounts payable 34,756 ( 139,519 ) 180,469

Accrued compensation 29,172 30,958 16,167

Other current liabilities 131,627 ( 42,508 ) 284,862

Other long-term liabilities 75,447 31,028 ( 4,712 )

Other long-term liabilities (including $ 4,900 , $ 107,763 , and nil associated with a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

125,647 75,447 31,028

Net cash used in operating activities ( 2,019,674 ) ( 2,489,753 ) ( 2,226,258 )

Cash flows from investing activities:

Purchases of property, plant and equipment ( 910,644 ) ( 1,074,852 ) ( 421,220 )

Proceeds from government grant 97,500 97,267 —

Purchases of investments ( 3,998,282 ) ( 3,854,129 ) —

Purchases of property, plant and equipment (including $( 164,683 ), $( 80,511 ), and $( 18,834 ) from a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

( 883,841 ) ( 910,644 ) ( 1,074,852 )

Purchases of investments (including $( 35,000 ), nil , and nil from a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

( 4,622,890 ) ( 3,998,282 ) ( 3,854,129 )

Proceeds from maturities of investments 4,112,084 3,720,890 1,149,714

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100,193 148,388 —

Proceeds from government grant — 97,500 97,267

Other investing activities — ( 4,827 ) 323

Net cash used in investing activities

$ ( 1,294,454 ) $ ( 946,975 ) $ ( 3,681,677 )

The accompanying notes are an integral part of these consolidated financial statements.

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Cash flows from financing activities:

Proceed from issuance of convertible notes, net of issuance costs $ — $ — $ 2,002,437

Payment of transaction costs for the issuance of convertible notes — — ( 15,883 )

Proceeds from issuance of common stock under 2024 Underwriting Agreement, net of issuance costs

Proceeds from issuance of common stock under 2023 Subscription Agreement, net of issuance costs 1,812,641 — —

Proceeds from issuance of common stock under 2024 Subscription Agreement to a related party, net of issuance costs

1,025,660 — —

Proceeds from issuance of common stock under 2023 Underwriting Agreement, net of issuance costs

— 1,184,224 —

Proceeds from issuance of common stock under 2023 Subscription Agreement to a related party, net of issuance costs — 1,812,641 —

Proceeds from issuance of common stock under At-the-Market Offering, net of issuance costs — — 594,317

Proceeds from issuance of common stock under 2022 Subscription Agreement

Proceeds from short-term insurance financing note — — 41,935

Proceeds from issuance of common stock under 2022 Subscription Agreement to a related party

Proceeds from issuance of Series A redeemable convertible preferred stock to a related party 1,000,000 — —

Proceeds from issuance of Series B redeemable convertible preferred stock to a related party 750,000 — —

Payments of issuance costs for Series A redeemable convertible preferred stock ( 2,351 ) — —

Payments of issuance costs for Series B redeemable convertible preferred stock ( 641 ) — —

Payment for credit facility issuance costs (including $( 5,625 ), nil , and nil to a related party for the years ended December 31, 2024, 2023, and 2022, respectively)

( 6,244 ) — ( 6,631 )

Payment for short-term insurance financing note — — ( 15,330 )

Payment for finance lease liabilities ( 3,166 ) ( 5,425 ) ( 4,977 )

Proceeds from borrowings 62,911 29,818 —

Repayments for borrowings — ( 20,223 ) —

Proceeds from borrowings from a related party 79,844 62,911 29,818

Repayment of borrowings to a related party

( 25,856 ) — ( 20,223 )

Proceeds from failed sale-leaseback transaction — — 31,700

Repurchase of Series B convertible preferred stock — — ( 3,000 )

Proceeds from issuance of Series D convertible preferred stock — — 3,000

Proceeds from issuance of Series E convertible preferred stock — — 600,000

Proceeds from exercise of stock options 4,883 10,343 17,788

Proceeds from the exercise of public warrants — — 173,273

Proceeds from the reverse capitalization — — 4,439,153

Payment of transaction costs related to the reverse recapitalization — — ( 38,865 )

Proceeds from employee stock purchase plan 19,208 23,836 24,562

Treasury stock repurchase — — ( 20,716 )

Tax withholding payments for net settlement of employee awards ( 10,021 ) ( 17,615 ) ( 218,789 )

Payment for credit facility issuance costs — ( 6,631 ) —

Net cash provided by financing activities 3,549,673 3,070,915 1,347,235

Net decrease in cash, cash equivalents, and restricted cash

( 365,813 ) ( 4,560,700 ) 5,657,602

Net increase (decrease) in cash, cash equivalents, and restricted cash 235,545 ( 365,813 ) ( 4,560,700 )

Beginning cash, cash equivalents, and restricted cash 1,371,507 1,737,320 6,298,020

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Supplemental disclosure of non-cash investing and financing activity:

Purchases of property, plant and equipment included in accounts payable and other current liabilities $ 35,849 $ 42,728 $ 101,057

Property, plant and equipment and right-of-use assets obtained through leases

Increases (decrease) in accounts payable and accrued liabilities related to property, plant and equipment (including $( 19,725 ), $ 8,530 and $ 11,196 associated with a related party for the years ended December 31, 2024, 2023 and 2022, respectively)

$ ( 68,930 ) $ 35,849 $ 42,728

Government grant (related party) reflected in property, plant and equipment $ ( 62,471 ) $ ( 99,025 ) $ ( 33,297 )

Property, plant and equipment and right-of-use assets obtained through leases $ 24,173 $ 32,477 $ 157,894

Equity securities obtained through Strategic Technology Arrangement

$ — $ 73,193 $ —

Issuance of Series D convertible preferred stock upon exercise of preferred stock warrants $ — $ — $ 9,936

Issuance of Series E convertible preferred stock contingent forward contracts $ — $ — $ 2,167,332

Capital contribution upon forfeit of Series E awards $ — $ — $ 15,719

Issuance of Series E convertible preferred stock upon settlement of contingent forward contracts $ — $ — $ 2,621,877

Issuance of common stock upon conversion of preferred stock in connection with the reverse recapitalization $ — $ — $ 5,836,785

The accompanying notes are an integral part of these consolidated financial statements.

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Lucid Group, Inc.

(“Lucid”) is a technology company focused on designing, developing, manufacturing, and selling the next generation of electric vehicles (“EV”), EV powertrains and battery systems.

Lucid was originally incorporated in Delaware on April 30, 2020 under the name Churchill Capital Corp IV (formerly known as Annetta Acquisition Corp) (“Churchill”) as a special purpose acquisition company with the purpose of effecting a merger with one or more operating businesses.

On February 22, 2021, Churchill entered into a definitive merger agreement (the “Merger Agreement”) with Atieva, Inc.

(“Legacy Lucid”) in which Legacy Lucid would become a wholly owned subsidiary of Churchill (the “Merger”).

Upon the closing of the Merger on July 23, 2021 (the “Closing”), Churchill was immediately renamed to “Lucid Group, Inc.” The Merger between Churchill and Legacy Lucid was accounted for as a reverse recapitalization.

See Note 4 “Reverse Recapitalization” for more information.

(“Lucid”) is a technology company that is setting new standards with the world’s most advanced electric vehicles (“EV”), the award-winning Lucid Air and all-new Lucid Gravity.

Throughout the notes to the consolidated financial statements, unless otherwise noted, the “Company,” “we,” “us” or “our” and similar terms refer to Legacy Lucid and its subsidiaries prior to the consummation of the merger, and Lucid and its subsidiaries after the consummation of the merger.

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The Company completed the first phase of the construction of its Advanced Manufacturing Plant-1 in Casa Grande, Arizona (“AMP-1”) in 2021, transitioned general assembly to the AMP-1 phase 2 manufacturing facility and completed the semi knocked-down (“SKD”) portion of its Advanced Manufacturing Plant-2 in Saudi Arabia (“AMP-2”) in September 2023.

The Company also completed key manufacturing activities, including the paint shop, stamping, a new body shop for the Lucid Gravity, and a majority of the powertrain shop, of the AMP-1 phase 2 manufacturing facility in 2024.

The Company began commercial production of its first vehicle, the Lucid Air, in September 2021 and delivered its first vehicles in late October 2021.

Currently, the AMP-1 phase 2 facility manufactures the Lucid Air and the Lucid Gravity.

The Company continues to expand AMP-1, construct the completely-built-up (“CBU”) portion of AMP-2, and build a network of retail sales and service locations.

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The Company’s existing sources of liquidity include cash, cash equivalents, investments, and credit facilities.

Historically, the Company funded operations primarily with issuances of common stock, convertible preferred stock and convertible notes.

Upon the completion of the Merger, the Company received $ 4,400.3 million in cash proceeds, net of transaction costs.

In December 2021, the Company issued an aggregate principal amount of $ 2,012.5 million of 1.25 % convertible senior notes due in December 2026.

The Company funded operations primarily with issuances of common stock, convertible preferred stock, and convertible notes.

In 2022, the Company entered into a loan agreement with the Saudi Industrial Development Fund (“SIDF”) with an aggregate principal amount of up to approximately $ 1.4 billion, a five-year senior secured asset-based revolving credit facility (“ABL Credit Facility”) with an initial aggregate principal commitment amount of up to $ 1.0 billion, and revolving credit facilities (the “GIB Facility Agreement”) with Gulf International Bank (“GIB”) in an aggregate principal amount of approximately $ 266.1 million.

The GIB Facility Agreement provided for two committed revolving credit facilities, of which $ 173.0 million was available as a bridge financing (the “Bridge Facility”) and $ 93.1 million was for general corporate purposes (the “Working Capital Facility”).

In March 2023, the Company amended the GIB Facility Agreement (together with the GIB Facility Agreement, the “Amended GIB Facility Agreement”) to combine the Bridge Facility and the Working Capital Facility into a committed $ 266.7 million revolving credit facility (the “GIB Credit Facility”), which will bear interest at a rate of 1.40 % per annum over SAIBOR (based on the term of borrowing) and associated fees.

In March 2023, the Company amended the GIB Facility Agreement (together with the GIB Facility Agreement, the “2023 Amended GIB Facility Agreement”) to combine the Bridge Facility and the Working Capital Facility into a committed $ 266.1 million revolving credit facility (the “2023 GIB Credit Facility”), which bears interest at a rate of 1.40 % per annum over SAIBOR (based on the term of borrowing) and associated fees.

See Note 6 “Debt” for more information.

On November 8, 2022, the Company entered into an equity distribution agreement (the “Equity Distribution Agreement”) with BofA Securities, Inc., Barclays Capital Inc.

In February 2025, Lucid LLC, a limited liability company established in Saudi Arabia and a subsidiary of the Company (“Lucid LLC”), entered into an agreement to renew the 2023 GIB Credit Facility (the “2025 GIB Credit Facility”) maturing on February 24, 2028 to increase the credit facility committed amount from SAR 1.0 billion (approximately $ 266.1 million) to SAR 1.9 billion (approximately $ 506.7 million).

Loans under the 2025 GIB Credit Facility may be used for general corporate purposes, have a maturity of no more than 12 months, and bear interest at a rate of 1.40 % per annum over SAIBOR (based on the term of borrowing) and associated fees.

See Note 18 “Subsequent Event” for more information.

In November 2022, the Company entered into an equity distribution agreement (the “Equity Distribution Agreement”) with BofA Securities, Inc., Barclays Capital Inc.

and Citigroup Global Markets Inc., under which the Company could offer and sell shares of its common stock having an aggregate offering price up to $ 600.0 million (the “At-the-Market Offering”).

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No shares remain available for sale under the Equity Distribution Agreement.

See Note 12 “Stockholders’ Equity” for more information.

On May 31, 2023, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with BofA Securities, Inc.

See Note 9 “Stockholders’ Equity” and Note 16 “Related Party Transactions” for more information.

In May 2023, the Company entered into an underwriting agreement (the “2023 Underwriting Agreement”) with BofA Securities, Inc.

(the “Underwriter”), under which the Underwriter agreed to purchase from the Company shares of the Company’s common stock in a public offering for aggregate net proceeds to the Company of $ 1.2 billion.

On May 31, 2023, the Company also entered into a subscription agreement (the “2023 Subscription Agreement”) with Ayar, pursuant to which Ayar agreed to purchase from the Company shares of the Company’s common stock in a private placement for aggregate net proceeds of $ 1.8 billion.

In May 2023, the Company also entered into a subscription agreement (the “2023 Subscription Agreement”) with Ayar, pursuant to which Ayar agreed to purchase from the Company shares of the Company’s common stock in a private placement for aggregate net proceeds of $ 1.8 billion.

In June 2023, the Company completed the public offering pursuant to the 2023 Underwriting Agreement for aggregate net proceeds of $ 1.2 billion and also consummated the private placement to Ayar pursuant to the 2023 Subscription Agreement for aggregate net proceeds of $ 1.8 billion.

See Note 12 “Stockholders’ Equity” for more information.

See Note 9 “Stockholders’ Equity” and Note 16 “Related Party Transactions” for more information.

In March 2024, the Company entered into a subscription agreement (the “Series A Subscription Agreement”) with Ayar.

Pursuant to the Series A Subscription Agreement, Ayar agreed to purchase from the Company 100,000 shares of its Series A convertible preferred stock, par value $ 0.0001 per share (the “Series A Redeemable Convertible Preferred Stock”), for an aggregate purchase price of $ 1.0 billion in a private placement.

Subsequently, in March 2024, the Company issued the shares to Ayar pursuant to the Series A Subscription Agreement and received aggregate net proceeds of $ 997.6 million.

In August 2024, the Company entered into a subscription agreement (the “Series B Subscription Agreement”) with Ayar.

Pursuant to the Series B Subscription Agreement, Ayar agreed to purchase from the Company 75,000 shares of its Series B convertible preferred stock, par value $ 0.0001 per share (the “Series B Redeemable Convertible Preferred Stock”), for an aggregate purchase price of $ 750.0 million in a private placement.

Subsequently, in August 2024, the Company issued the shares to Ayar pursuant to the Series B Subscription Agreement and received aggregate net proceeds of $ 749.4 million.

See Note 8 “Redeemable Convertible Preferred Stock” and Note 16 “Related Party Transactions” for more information.

The Series A Redeemable Convertible Preferred Stock and the Series B Redeemable Convertible Preferred Stock (the “Redeemable Convertible Preferred Stock”) are convertible at the option of the holder (i) at any time the closing price per share of the common stock on the trading date immediately preceding the date on which the holder delivers the relevant notice of conversion is at least a certain price threshold as noted in the certificate of designations of Series A Redeemable Convertible Preferred Stock (the “Series A Certificate of Designations”) and in the certificate of designations of the Series B Redeemable Convertible Preferred Stock (the “Series B Certificate of Designations”) of the Company or (ii) during specified periods preceding a fundamental change or optional redemption by the Company under the terms of the Redeemable Convertible Preferred Stock.

See Note 8 “Redeemable Convertible Preferred Stock” for more information.

In August 2024, the Company entered into a $ 750.0 million five-year unsecured delayed draw term loan credit facility (the “DDTL Credit Facility”) with Ayar.

See Note 6 “Debt” and Note 16 “Related Party Transactions” for more information.

In October 2024, the Company entered into an underwriting agreement (the “2024 Underwriting Agreement”) with the Underwriter, under which the Underwriter agreed to purchase shares of the Company’s common stock.

The Company also granted the Underwriter a 30-day option to purchase additional shares of its common stock (the “Overallotment Option”), and the Underwriter exercised the Overallotment Option to purchase additional shares.

In October 2024, the Company also entered into a subscription agreement (the “2024 Subscription Agreement”) with Ayar, pursuant to which Ayar agreed to purchase from the Company shares of the Company’s common stock in a private placement.

In addition, given the Underwriter’s exercise of the Overallotment Option, Ayar agreed to purchase additional shares of the Company’s common stock.

In October 2024, the Company completed the public offering pursuant to the 2024 Underwriting Agreement for aggregate net proceeds of $ 718.4 million and also consummated the private placement of shares to Ayar pursuant to the 2024 Subscription Agreement for aggregate net proceeds of $ 1,025.7 million.

See Note 9 “Stockholders’ Equity” and Note 16 “Related Party Transactions” for more information.

Certain Significant Risks and Uncertainties

The Company’s current business activities consist of (i) generating sales from the deliveries and service of vehicles, (ii) research and development efforts to design, engineer and develop high-performance fully electric vehicles and advanced electric vehicle powertrain components, including battery pack systems, (iii) further construction of AMP-1 phase 2 in Casa Grande, Arizona, (iv) construction of the CBU portion of AMP-2 in Saudi Arabia, (v) expansion of its retail studios and service centers capabilities throughout North America and across the globe, and (vi) providing its technology access to third parties.

The Company’s current business activities consist of (i) generating sales from the deliveries and service of vehicles, (ii) research and development efforts to design, engineer and develop high-performance fully electric vehicles and advanced electric vehicle powertrain components, including battery pack systems, (iii) construction of the CBU portion of AMP-2 in Saudi Arabia, (iv) further construction of AMP-1 phase 2 in Casa Grande, Arizona, (v) expansion of its retail studios and service centers capabilities throughout North America and across the globe, and (vi) providing its technology access to third parties.

The Company is subject to the risks associated with such activities, including the need to further develop its technology, its marketing, and distribution channels;

further develop its supply chain and manufacturing;

and hire additional management and other key employees.

Successful completion of the Company’s development program and, ultimately, the attainment of profitable operations are dependent upon future events, including our ability to access potential markets, and secure long-term financing.

the need to further develop its supply chain and manufacturing;

and the need to hire additional management and other employees.

The Company participates in a dynamic high-technology industry.

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and the Company’s ability to attract and retain employees necessary to support its business operations.

A global economic recession or other downturn, whether due to inflation, global conflicts or other geopolitical events, COVID-19 or other public health crises, interest rate increases or other policy actions by major central banks, government closures of banks and liquidity concerns at other financial institutions, or other factors, may have an adverse impact on the Company’s business, prospects, financial condition and results of operations.

Adverse economic conditions as well as uncertainty about the current and future global economic conditions may cause the Company’s customers to defer purchases or cancel their reservations and orders in response to higher interest rates, availability of consumer credit, decreased cash availability, fluctuations in foreign currency exchange rates, and weakened consumer confidence.

A global economic recession or other economic downturn, whether due to inflation, global conflicts or other geopolitical events, public health crises, interest rate increases or other policy actions by major central banks, government closures of banks and liquidity concerns at other financial institutions, or other factors, may have an adverse impact on the Company’s business, prospects, financial condition and results of operations.

Adverse economic conditions as well as uncertainty about the current and future global economic conditions may cause the Company’s customers to defer purchases or cancel their orders in response to higher interest rates, availability of consumer credit, decreased cash availability, fluctuations in foreign currency exchange rates, and weakened consumer confidence.

Reduced demand for the Company’s products may result in significant decreases in product sales, which in turn would have a material adverse impact on the Company’s business, prospects, financial condition and results of operations.

Because of the Company’s premium brand positioning and pricing, an economic downturn is likely to have a heightened adverse effect on the Company compared to many of its electric vehicle and traditional automotive industry competitors, to the extent that consumer demand for luxury goods is reduced in favor of lower-priced alternatives.

In addition, any economic recession or other downturn could also cause logistical challenges and other operational risks if any of the Company’s suppliers, sub-suppliers or partners become insolvent or are otherwise unable to continue their operations, fulfill their obligations to the Company, or meet the Company’s future demand.

In addition, any economic recession or other economic downturn could also cause logistical challenges and other operational risks if any of the Company’s suppliers, sub-suppliers or partners become insolvent or are otherwise unable to continue their operations, fulfill their obligations to the Company, or meet the Company’s future demand.

In addition, the deterioration of conditions in the broad financing markets may limit the Company’s ability to obtain external financing to fund its operations and capital expenditures on terms favorable to the Company, if at all.

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Actual results could differ from those estimates.

Significant estimates, assumptions and judgments made by management include, among others, inventory valuation, warranty reserve, useful lives of property, plant and equipment, fair value of common stock warrants, fair value of contingent forward contracts liability, estimates of residual value guarantee (“RVG”) liability, deferred revenue related to technology access fees and over-the-air (“OTA”) software updates, sales return reserves, fair value of common stock prior to the Merger and other assumptions used to measure stock-based compensation expense, and estimated incremental borrowing rates for assessing operating and finance leases.

Significant estimates, assumptions and judgments made by management include, among others, inventory valuation, warranty reserve, useful lives of property, plant and equipment, fair value of common stock warrants, fair value of derivative liabilities associated with the Redeemable Convertible Preferred Stock, estimates of residual value guarantee (“RVG”) liability, deferred revenue related to technology access fees and over-the-air (“OTA”) software updates, sales return reserves, assumptions used to measure stock-based compensation expense, income taxes, and estimated incremental borrowing rates for assessing operating and finance leases.

These estimates and assumptions are based on management’s best estimates and judgment.

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The Company considers all highly liquid investments with an original maturity at the date of purchase of three months or less to be cash equivalents.

Restricted cash in other current assets and other noncurrent assets is primarily related to letters of credit issued to the landlords for certain of the Company’s leased facilities.

Restricted cash in other current assets is primarily related to letters of credit issued to the landlords for certain of the Company’s leased facilities.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash to amounts shown in the statements of cash flows (in thousands):

2023 2022 2021

Cash and cash equivalents $ 1,606,865 $ 1,369,947

Restricted cash included in other current assets

1,560 1,555 10,740

Restricted cash included in other noncurrent assets

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Realized gains and losses on the sale of available-for-sale securities are recorded in other income (expense), net in the consolidated statements of operations and comprehensive loss.

The Company regularly reviews its investment portfolio of available-for-sale securities for allowance for credit losses.

The Company regularly reviews its investment portfolio of available-for-sale securities for allowance for credit lo sses.

Factors considered include severity of declines in fair values below amortized costs, adverse conditions related to securities, creditworthiness of the security issuers, and collectability of principal and interest payments.

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Accounts Receivable, Net

Accounts receivable consist of receivables from our customers and from financial institutions offering financing products to our customers for the sale of vehicles, sales of powertrain kits and services.

Accounts receivable consists of receivables from our customers and from financial institutions offering financing products to our customers for the sale of vehicles, sales of powertrain kits, services, and regulatory credits.

The Company provides an allowance against accounts receivable for any potential uncollectible amounts.

The Company recorded immaterial allowance for uncollectible amounts as of December 31, 2023 and 2022.

The Company recorded immaterial allowance for credit losses as of December 31, 2024 and 2023.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, cash equivalents, investments and accounts receivable.

The Company places its cash primarily with domestic financial institutions that are federally insured within statutory limits, but at times its deposits may exceed federally insured limits.

As of December 31, 2023, accounts receivables from the EV purchase agreement with the Government of Saudi Arabia, a related party of PIF, which is an affiliate of Ayar, as represented by the Ministry of Finance (the “EV Purchase Agreement”), represented 68.5 % of the total accounts receivable balance.

The Company places its cash primarily with domestic financial institutions that are federally insured within statutory limits, but its deposits exceed federally insured limits.

As of December 31, 2024 and 2023, accounts receivable from the EV purchase agreement with the Government of Saudi Arabia, a related party of the Public Investment Fund (“PIF”), which is an affiliate of Ayar, as represented by the Ministry of Finance (the “EV Purchase Agreement”), represented 51.7 % and 68.5 % of the total accounts receivable balance, respectively.

See Note 16 “Related Party Transactions” for more information.

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Costs incurred during the preliminary project stage and post-implementation stage are expensed.

The Company classifies vehicles sold with repurchase obligations that are accounted for as operating leases within Property, plant and equipment, which are initially measured at cost and depreciated on a straight-line basis to the estimated residual value over the contractual period.

The Company generally uses the following estimated useful lives for each asset category:

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Leasehold improvements Shorter of remaining lease term or the estimated useful lives of the assets

Management determines the useful lives of the Company’s property and equipment when those assets are initially recognized and routinely reviews the remaining estimated useful lives.

Current estimate of useful lives represents the best estimate of the useful lives based on the Company’s current facts and circumstances, but may differ from the actual useful lives due to changes to its business operations, changes in the planned use of assets, and the technological advancements.

When management changes the estimate useful life assumption for any asset, the remaining carrying amount of the asset is accounted for prospectively and depreciated over the revised estimated useful life.

Expenditures for repair and maintenance costs are expensed as incurred, and expenditures for major renewals and improvements that increase functionality of the asset are capitalized and depreciated ratably over the identified useful life.

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There are two performance obligations identified in vehicle sale arrangements.

These are the vehicle including an onboard advanced driver assistance system (“ADAS”), and the right to unspecified OTA software updates to be provided as and when available over the term of the basic vehicle warranty, which is generally 4 years.

Shipping and handling provided by Company is considered a fulfillment activity.

Payment is typically received at or prior to the transfer of control of the vehicle to the customer, except for vehicle sales under the EV Purchase Agreement.

Shipping and handling provided by the Company is considered a fulfillment activity.

Payment is typically received at the time of delivery or shortly after delivery of the vehicle to the customer, except for vehicle sales under the EV Purchase Agreement.

Generally, control transfers to the customer at the time of delivery when the customer takes physical possession of the vehicle, which may be at a Lucid studio or other destination chosen by the customer.

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At the time of revenue recognition, the Company reduces the transaction price and records a sales return reserve against revenue for estimated variable consideration related to future product returns.

Return rate estimates are based on historical experience and sales return reserve balance was not material as of December 31, 2023 and 2022.

Return rate estimates are based on historical experience and the sales return reserve balance was not material as of December 31, 2024 and 2023.

The Company provides a manufacturer’s warranty on all vehicles sold.

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Vehicle Sales with Residual Value Guarantee

The Company provides an RVG to its commercial banking partner in connection with its vehicle leasing program.

Under the vehicle leasing program, the Company generally receives full payment for the vehicle sales price at the time of delivery or shortly after delivery, does not bear casualty and credit risks during the lease term, and is contractually obligated (or entitled) to share a portion of the shortfall (or excess) between the resale value realized by the commercial banking partner and a predetermined resale value.

During the years ended December 31, 2023 and 2022, vehicle sales with RVG totaled $ 190.9 million and $ 31.1 million, respectively.

At the lease inception, the Company is required to deposit cash collateral equal to a contractual percentage of the residual value of the leased vehicles with the commercial banking partner.

The Company provides an RVG to its commercial banking partners in connection with its vehicle leasing program.

Vehicle sales with RVG totaled $ 442.7 million, $ 190.9 million, and $ 31.1 million during the years ended December 31, 2024, 2023, and 2022, respectively.

Under the vehicle leasing program, the Company generally receives payment for the vehicle sales price at the time of delivery or shortly after the delivery, does not bear casualty and credit risks during the lease term, and is contractually obligated (or entitled) to share a portion of the shortfall (or excess) between the resale value realized by the commercial banking partners and a predetermined resale value.

At the lease inception, the Company is required to deposit cash collateral equal to a contractual percentage of the residual value of the leased vehicles with the commercial banking partners.

The cash collateral is held in a restricted bank account owned by the commercial banking partner until it is used, as applicable, in settlement of the RVG at the end of the lease term.

Cash collateral is recorded in other noncurrent assets, subject to asset impairment review at each reporting period.

Cash collateral is recorded in other current assets and other noncurrent assets on consolidated balance sheets, subject to an asset impairment review at each reporting period.

The Company accounts for the vehicle leasing program in accordance with ASC 842, Leases, ASC 460, Guarantees and ASC 606, Revenue from Contracts with Customers .

The Company is the lessor at inception of a lease and immediately transfers the lease as well as the underlying vehicle to its commercial banking partner, with the transaction being accounted for as a sale under ASC 606.

The Company is the lessor at inception of a lease and immediately transfers the lease as well as the underlying vehicle to its commercial banking partners, with the transaction being accounted for as a sale under ASC 606.

The Company recognizes revenue when control transfers upon delivery when the consumer-lessee takes physical possession of the vehicle, and bifurcates the RVG at fair value and accounts for it as a guarantee liability.

The remaining amount of the transaction price is allocated among the performance obligations, including the vehicle, the right to unspecified OTA software updates and remarketing activities, in proportion to the standalone selling price of the Company’s performance obligations.

Any fees or incentives that are paid or payable by the Company to commercial banking partners are recognized as a reduction to vehicle sales revenue.

The guarantee liability represents the estimated amount the Company expects to pay at the end of the lease term.

The Company is released from residual risk upon either expiration or settlement of the RVG.

The Company evaluates variables such as third-party residual value publications, risk of future price deterioration due to changes in market conditions and reconditioning costs to determine the estimated residual value guarantee liability.

The RVG liabilities were not material as of December 31, 2023 and 2022.

As of December 31, 2024, the Company recorded $ 58.0 million of RVG liabilities.

The RVG liabilities were not material as of December 31, 2023.

As the Company accumulates more data related to the resale value of our vehicles or as market conditions change, there could be material changes to the estimated guarantee liabilities.

As of December 31, 2023 and 2022, the Company recorded $ 28.7 million and $ 15.4 million of total deferred revenue related to OTA and remarketing activities for vehicle sales, respectively.

The maximum potential amount of future payments (in excess of RVG liabilities recorded) that the Company could be required to make was $ 401.1 million and $ 101.1 million as of December 31, 2024 and 2023, respectively.

As of December 31, 2024 and 2023, the Company recorded $ 53.3 million and $ 28.7 million of total deferred revenue from all vehicle sales primarily related to OTA and remarketing activities for vehicle sales, respectively.

The Company recorded $ 18.5 million and $ 7.7 million of the total deferred revenue within other current liabilities and the remaining $ 34.8 million and $ 21.0 million within other long-term liabilities in the consolidated balance sheets as of December 31, 2024 and 2023, respectively.

Revenue recognized during the years ended December 31, 2024, 2023, and 2022 from the prior period deferred revenue balances was not material.

Other consists of revenue from non-warranty after-sales vehicle services, sales of battery pack systems, powertrain kits, retail merchandise, and regulatory credits.

Vehicle Operating Lease Revenue

The Company accounts for sales of vehicles with repurchase obligations as operating leases.

The Company sells vehicles primarily to rental companies with an obligation to repurchase the vehicles at an agreed upon repurchase price.

The Company records the difference between the proceeds received and the agreed upon repurchase price as vehicle leasing revenue on a straight-line basis over the term of the lease.

Deferred leasing revenue and repurchase obligation were recorded in other current liabilities and other long-term liabilities in the consolidated balance sheets, and were not material as of December 31, 2024 and 2023.

The operating lease revenue was not material for the years ended December 31, 2024, 2023, and 2022.

Other consists of revenue from non-warranty after-sales vehicle services and parts, sales of battery pack systems, powertrain kits, retail merchandise, and regulatory credits.

Battery pack system and powertrain kits revenue consists of the sales of battery pack systems or powertrain kits, supplies and related services for vehicles.

The Company generates regulatory credits revenue from the sale of tradable credits the Company earns under various regulations.

This include credits related to zero emission vehicles and greenhouse gas, and the Corporate Average Fuel Economy (“CAFE”) credits.

The sale of battery pack systems, powertrain kits along with related supplies, and regulatory credits is a single performance obligation recognized at the point in time when control is transferred to the customer.

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Cost of vehicle sales includes direct parts, materials, shipping and handling costs, allocable overhead costs such as depreciation of manufacturing related equipment and facilities, information technology costs, personnel costs, including wages and stock-based compensation, estimated warranty costs, charges to reduce inventories to their net realizable value, charges for any excess or obsolete inventories, and losses from firm purchase commitments.

Manufacturing credits earned are recorded as a reduction to cost of vehicle sales.

Vehicle Operating Lease

Depreciation of operating lease vehicles are classified as cost of vehicle operating lease revenue.

Cost of other revenue includes direct parts, material and labor costs, manufacturing overhead, including depreciation of tooling costs, shipping and logistic costs.

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The Company accrues a warranty reserve for all products sold which includes the Company’s best estimates of the projected costs related to recalls identified and special campaigns to repair or replace items under warranties.

The Company reviews the adequacy of warranty reserve on a regular basis.

Changes to the Company’s historical or projected warranty experience may cause material changes to the warranty reserve in the future.

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The warranty expense is recorded as a component of cost of revenue in the consolidated statements of operations and comprehensive loss.

The Company recognizes recovery from suppliers as an offset to the warranty expenses in the consolidated statements of operations and comprehensive loss and in other current assets in the consolidated balance sheet when the recovery amounts are contractually agreed with the suppliers.

During the year ended December 31, 2024, the Company recorded supplier recovery of $ 50 million.

The Company utilizes the liability method to account for income taxes, under which deferred tax assets and liabilities arise from the temporary differences between the tax basis of an asset or liability and its reported amount in the consolidated financial statements, as well as from net operating loss and tax credit carryforwards.

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The Company records uncertain tax positions on the basis of a two-step process which includes (1) determining whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position , and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

The Company’s policy is to recognize interest related to unrecognized tax benefits in other income (expense), net and to recognize penalties in general and administrative expenses in the consolidated statements of operations and comprehensive loss.

Accrued interest and penalties are included within other current liabilities in the consolidated balance sheets.

The Company’s policy is to recognize interest and penalties related to unrecognized tax benefits in provision for income taxes in the consolidated statements of operations and comprehensive loss.

Accrued interest and penalties are included within other long-term liabilities in the consolidated balance sheets.

Stock-Based Compensation

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The fair value of awards that vest based on only continuous service is recognized on a straight-line basis over the requisite service period.

The fair value of awards that vest based on performance or market conditions is recognized over the requisite service period using the accelerated attribution method.

The fair value of awards that vest based on performance or market conditions is recognized over the requisite service period using the graded vesting attribution method.

Stock-based compensation expense is only recognized for awards with performance conditions once the performance condition becomes probable of being achieved.

The performance-based RSUs granted prior to the Closing of the Merger vested upon the Closing of the Merger .

The performance-based RSUs granted after the Closing of the Merger will vest based on the actual achievement of corporate performance goals and individual performance.

The performance-based RSUs will vest based on the actual achievement of corporate performance goals and/or individual performance.

The RSUs with market conditions will vest only if the Company achieves certain market capitalization targets.

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Research and Development

Research and development expenses consist primarily of materials, supplies, personnel-related expenses, contractor fees, engineering design and testing expenses, and allocated facilities cost.

Research and development expenses primarily consist of materials, supplies, personnel-related expenses, contractor fees, engineering design and testing expenses, and allocated facilities cost.

Substantially all of the Company’s research and development expenses are related to developing new products, related technologies, and services and improving existing products and services.

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Selling, General, and Administrative

Selling, general and administrative expense consist of personnel-related expenses for employees involved in general corporate, selling and marketing functions, including executive management and administration, legal, human resources, facilities and real estate, accounting, finance, tax, and information technology.

Advertising costs are expensed as incurred and are included in sales and marketing expenses in the consolidated statements of operations and comprehensive loss.

Advertising costs were $ 35.3 million for the year ended December 31, 2023.

These costs were not material for the years ended December 31, 2022 and 2021, respectively.

Selling, general and administrative expenses primarily consist of personnel-related expenses for employees involved in general corporate, selling and marketing functions, including executive management and administration, legal, human resources, allocated facilities and real estate, accounting, finance, tax, and information technology.

Advertising costs are expensed as incurred and are included in selling, general, and administrative expenses in the consolidated statements of operations and comprehensive loss.

Advertising costs were $ 49.8 million and $ 35.3 million for the years ended December 31, 2024 and 2023, respectively.

These costs were not material for the year ended December 31, 2022.

Restructuring

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Legal costs incurred in connection with loss contingencies are expensed as incurred.

Redeemable Convertible Preferred Stock

Accounting for the redeemable convertible preferred stock requires an evaluation to determine if liability classification is required under ASC 480-10.

Liability classification is required for freestanding financial instruments that are (1) subject to an unconditional obligation requiring the issuer to redeem the instrument by transferring assets, such as those that are mandatorily redeemable, (2) instruments other than equity shares that embody an obligation of the issuer to repurchase its equity shares, or (3) certain types of instruments that obligate the issuer to issue a variable number of equity shares.

Securities that do not meet the scoping criteria to be classified as a liability under ASC 480 are subject to redeemable equity guidance, which prescribes securities that may be subject to redemption upon an event not solely within the Company’s control to be classified as temporary equity.

Securities classified in temporary equity are initially measured at the proceeds received, net of issuance costs and excluding the fair value of bifurcated embedded derivatives, if any.

Subsequent measurement of the carrying value of the redeemable convertible preferred stock is required as the instrument is probable of becoming redeemable.

The Company accretes the redeemable convertible preferred stock to its redemption value.

In certain circumstances, the redemption price may vary based on changes in stock price, in which case the Company recognizes changes in the redemption value immediately as they occur and adjust the carrying value of the security to equal the then current maximum redemption value at the end of each reporting period.

Derivative Liabilities

The Company evaluates all of its financial instruments, including convertible notes and redeemable convertible preferred stock, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.

The Company applies significant judgment to identify and evaluate complex terms and conditions in these contracts and agreements to determine whether embedded derivatives exist.

Embedded derivatives must be separately measured from the host contracts if all the requirements for bifurcation are met.

The assessment of the conditions surrounding the bifurcation of embedded derivatives depends on the nature of the host contract.

Bifurcated embedded derivatives are recognized at fair value, with changes in fair value recognized in the consolidated statements of operations and comprehensive loss at each reporting period end.

Bifurcated embedded derivatives are classified as a separate liability in the consolidated balance sheet.

The Company’s derivative liabilities are related to the conversion features embedded in the Redeemable Convertible Preferred Stock.

See Note 8 “Redeemable Convertible Preferred Stock” for more information.

Net Loss Per Share

Basic and diluted net loss per share attributable to common stockholders is computed in conformity with the two-class method required for participating securities.

The Company considers all series of its convertible preferred stock to be participating securities as the holders of such shares have the right to receive nonforfeitable dividends on a pari passu basis in the event that a dividend is paid on common stock.

Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the preferred stockholders do not have a contractual obligation to share in the Company’s losses.

The Company considers all series of its redeemable convertible preferred stock to be participating securities as they are cumulative and participate in common stock dividends on an as-converted basis.

The net loss attributable to common stockholders will reflect the remeasurements of the host contracts for the cumulative dividend and mezzanine equity accretions.

Under the two-class method, the net loss attributable to common stockholders is not allocated to the redeemable convertible preferred stock as the preferred stockholders do not have a contractual obligation to share in the Company’s losses.

Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period.

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Potentially dilutive shares of Private Placement Warrants under treasury stock method are included in the computation of diluted net loss per share when their effect is dilutive.

For purposes of this calculation, Private Placement Warrants, stock options outstanding, RSUs outstanding, potential shares issued under ESPP and if-converted common shares from convertible note are considered to be common stock equivalents.

For purposes of this calculation, Private Placement Warrants, stock options outstanding, RSUs outstanding, potential shares issued under ESPP, if-converted common shares from convertible note, if-converted common shares from Series A redeemable convertible preferred stock and if-converted common shares from Series B redeemable convertible preferred stock are considered to be common stock equivalents.

Common Stock Warrants

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Liability-classified common stock warrants are subject to remeasurement to fair value as of any respective exercise date and as of each subsequent balance sheet date with changes in fair value recorded in the Company’s statement of operations and comprehensive loss.

For issued or modified common stock warrants outstanding that meet all of the criteria for equity classification, the common stock warrants are recorded as a component of additional paid-in capital and are not remeasured to fair value in subsequent reporting periods.

The Company’s publicly traded common stock warrants (the “Public Warrants”) are equity-classified instruments because they are deemed indexed to the Company’s own common stock and do not contain any provision that could require net cash settlement unless the holders of the underlying shares would also receive the same form of consideration as the holders of Public Warrants.

The Company’s privately placed common stock warrants (the “Private Placement Warrants”) are liability-classified instruments because they are not deemed indexed to the Company’s own common stock.

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Grants received in advance of the acquisition or construction of assets are recorded initially in deferred liability and then as a deduction in calculating the carrying amount of the related fixed assets upon acquisition or construction of the assets.

Recently Issued Accounting Pronouncements Not Yet Adopted

Recently Adopted Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No.

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The Company with a single reportable segment is required to provide all the disclosures from this amendment.

The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The guidance is effective for fiscal years beginning with the Company’s annual financial statements as of and for the year ended December 31, 2024, and applies to its financial statements for interim periods thereafter.

Early adoption is permitted, and should be applied retrospectively.

The Company is evaluating the impact of this amendment to the related financial statement disclosures.

The Company adopted ASU 2023-07 for the fiscal year ended December 31, 2024.

See Note 17 “Segment Reporting” for the required disclosures.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No.

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Early adoption is permitted and should be applied prospectively (with retrospective application permitted).

The Company is evaluating the impact of this amendment and does not expect a material impact to the related financial statement disclosures.

In March 2024, the SEC issued its final rule that requires certain climate-related disclosures in annual reports, including governance, oversight, and risk management processes on material climate-related risks;

material impact of climate risks on the Company’s strategy, business model, and outlook;

material climate targets and goals;

and material financial statements impacts due to severe weather events and other natural conditions.

This SEC rule provides phased effective dates, starting with fiscal years beginning on or after January 1, 2025.

The SEC rule is currently stayed pending the outcome of litigation, and the Company is evaluating the impact of this rule on its annual reports.

In November 2024, the FASB issued ASU No.

2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses, which requires disclosure of specified information about certain costs and expenses (such as purchases of inventory, employee compensation, depreciation, and amortization) within the relevant expense captions presented on the face of the statements of operations and comprehensive loss.

The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted, and should be applied either prospectively or retrospectively.

The Company is evaluating the impact of this amendment to the related financial statement disclosures.

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NOTE 3 - RESTRUCTURING

On March 28, 2023, the Company announced a restructuring plan (the “Restructuring Plan”) intended to reduce operating expenses in response to evolving business needs and productivity improvement through a reduction in workforce.

On May 24, 2024, the Company announced a restructuring plan (the “2024 Restructuring Plan”) intended to optimize operating expenses in response to evolving business needs and productivity improvement through a reduction in workforce.

The Company substantially completed the 2024 Restructuring Plan in 2024.

During the year ended December 31, 2023, the Company recorded charges of $ 24.5 million related to severance payments, employee benefits, employee transition and stock-based compensation, net of a reversal of previously recognized stock-based compensation expense.

These charges were recorded within restructuring charges in the consolidated statements of operations and comprehensive loss.

A summary of restructuring liabilities associated with the Restructuring Plan was as follows (in thousands):

December 31, 2023

During the year ended December 31, 2024, the Company recorded restructuring charges of $ 20.3 million related to the 2024 Restructuring Plan within restructuring charges in the consolidated statements of operations and comprehensive loss.

The restructuring charges were primarily related to severance payments, employee benefits, employee transition and stock-based compensation, net of a reversal of previously recognized stock-based compensation expense.

On March 28, 2023, the Company announced a restructuring plan (the “2023 Restructuring Plan”) intended to reduce operating expenses in response to evolving business needs and productivity improvement through a reduction in workforce.

The Company completed the 2023 Restructuring Plan during the first quarter of 2024.

During the year ended December 31, 2023, the Company recorded restructuring charges of $ 24.5 million.

A summary of restructuring liabilities associated with the restructuring plans was as follows (in thousands):

Year Ended December 31,

Restructuring liabilities - beginning of period $ 54 $ —

Restructuring charges excluding non-cash items (1)(2)

21,784 25,989

Cash payments ( 21,571 ) ( 25,935 )

Restructuring liabilities - end of period $ 267 $ 54

(1) Excluded non-cash items of $ 1.4 million for the year ended December 31, 2023, which was net of accelerated stock-based compensation expense of $ 3.4 million and a reversal of $ 4.8 million related to previously recognized stock-based compensation expenses for unvested restricted stock awards.

As of December 31, 2023, restructuring liabilities associated with the Restructuring Plan included in accrued compensation in the consolidated balance sheet was immaterial.

NOTE 4 – REVERSE RECAPITALIZATION

On July 23, 2021, upon the consummation of the Merger, all holders of 451,295,965 issued and outstanding Legacy Lucid common stock received shares of Lucid common stock at a deemed value of $ 10.00 per share after giving effect to the exchange ratio of 2.644 (the “Exchange Ratio”) resulting in 1,193,226,511 shares of Lucid common stock issued and outstanding as of the Closing and all holders of 42,182,931 issued and outstanding Legacy Lucid equity awards received Lucid equity awards covering 111,531,080 shares of Lucid common stock at a deemed value of $ 10.00 per share after giving effect to the Exchange Ratio, based on the following events contemplated by the Merger Agreement:

• the cancellation and conversion of all 437,182,072 issued and outstanding shares of Legacy Lucid preferred stock into 437,182,072 shares of Legacy Lucid common stock at the conversion rate as calculated pursuant to Legacy Lucid’s memorandum and articles of association at the date and time that the Merger became effective;

• the surrender and exchange of all 451,295,965 issued and outstanding shares of Legacy Lucid common stock (including Legacy Lucid common stock resulting from the conversion of the Legacy Lucid preferred stock) into 1,193,226,511 shares of Lucid common stock as adjusted by the Exchange Ratio;

• the cancellation and exchange of all 25,764,610 granted and outstanding vested and unvested Legacy Lucid Options, which became 68,121,210 Lucid Options exercisable for shares of Lucid common stock with the same terms and vesting conditions except for the number of shares exercisable and the exercise price, each of which was adjusted by the Exchange Ratio;

• the cancellation and exchange of all 16,418,321 granted and outstanding vested and unvested Legacy Lucid RSUs, which became 43,409,870 Lucid RSUs for shares of Lucid common stock with the same terms and vesting conditions except for the number of shares, which was adjusted by the Exchange Ratio.

The other related events that occurred in connection with the Closing are summarized below:

• Churchill entered into separate private placement subscription agreements (the “PIPE Investment”) contemporaneously with the execution of the Merger Agreement pursuant to which Churchill agreed to sell and issue an aggregate of 166,666,667 shares of common stock at a purchase price of $ 15.00 per share for an aggregate purchase price of $ 2,500.0 million.

The PIPE Investment closed simultaneously with the Closing of the Merger;

• Churchill Sponsor IV LLC (the “Churchill Sponsor”) exercised its right to convert the outstanding and unpaid amount of $ 1.5 million under the working capital loan provided by the Churchill Sponsor to Churchill into an additional 1,500,000 Private Placement Warrants at a price of $ 1.00 per warrant in satisfaction of such loan;

• Churchill and the Churchill Sponsor entered into a letter agreement (the “Sponsor Agreement”), pursuant to which the Churchill Sponsor agreed that 17,250,000 shares of Churchill’s issued and outstanding common stock beneficially held by the Churchill Sponsor (the “Sponsor Earnback Shares”) and 14,783,333 Private Placement Warrants beneficially held by the Churchill Sponsor (the “Sponsor Earnback Warrants”) to purchase shares of the Churchill’s common stock shall become subject to transfer restrictions and contingent forfeiture provisions upon the Closing of the Merger until Lucid’s stock price exceeded certain predetermined levels in the post-Merger period.

Any such shares and warrants not released from these transfer restrictions during the earnback period, which expires on the fifth anniversary of the Closing, will be forfeited back to Lucid for no consideration.

See Note 13 “Earnback Shares and Warrants” for more information;

• Churchill redeemed 21,644 public shares of Churchill’s Class A common stock at approximately $ 10.00 per share for an aggregate payment of $ 0.2 million.

After giving effect to the Merger and the redemption of Churchill shares as described above, the number of shares of common stock issued and outstanding immediately following the consummation of the Merger was as follows:

Churchill public shares, prior to redemptions 207,000,000

Less redemption of Churchill shares ( 21,644 )

Churchill public shares, net of redemptions 206,978,356

Churchill Sponsor shares (1)

PIPE shares (2)

Total shares of Churchill common stock outstanding immediately prior to the Merger 425,395,023

Legacy Lucid shares 1,193,226,511

Total shares of Lucid common stock outstanding immediately after the Merger (3)(4)

1,618,621,534

(1) The 51,750,000 shares beneficially owned by the Churchill Sponsor as of the Closing of the Merger includes the 17,250,000 Sponsor Earnback Shares.

(2) Reflects the sale and issuance of 166,666,667 shares of common stock to the PIPE Investors at $ 15.00 per share.

(3) Excludes 111,531,080 shares of common stock as of the Closing of the Merger to be reserved for potential future issuance upon the exercise of Lucid Options or settlement of Lucid RSUs.

(4) Excludes the 85,750,000 warrants issued and outstanding as of the Closing of the Merger, which includes the 41,400,000 Public Warrants and the 44,350,000 Private Placement Warrants.

The 44,350,000 Private Placement Warrants beneficially owned by the Churchill Sponsor as of the consummation of the Merger includes the 14,783,333 Sponsor Earnback Warrants.

The Merger has been accounted for as a reverse recapitalization under U.S.

Under this method of accounting, Churchill has been treated as the acquired company for financial reporting purposes.

The reverse recapitalization accounting treatment was primarily determined based on the stockholders of Legacy Lucid having a relative majority of the voting power of Lucid and having the ability to nominate the majority of the members of the Lucid board of directors, senior management of Legacy Lucid comprise the senior management of Lucid, and the strategy and operations of Legacy Lucid prior to the Merger comprise the only ongoing strategy and operations of Lucid.

Accordingly, for accounting purposes, the financial statements of Lucid represent a continuation of the financial statements of Legacy Lucid with the Merger being treated as the equivalent of Legacy Lucid issuing shares for the net assets of Churchill, accompanied by a recapitalization.

The net assets of Churchill were recognized as of the Closing at historical cost, with no goodwill or other intangible assets recorded.

Operations prior to the Merger are presented as those of Legacy Lucid and the accumulated deficit of Legacy Lucid has been carried forward after Closing.

All periods prior to the Merger have been retrospectively adjusted using the Exchange Ratio for the equivalent number of shares outstanding immediately after the Closing to effect the reverse recapitalization.

In connection with the Closing of the Merger, the Company raised $ 4,439.2 million of gross proceeds, including the contribution of $ 2,070.1 million of cash held in Churchill’s trust account from its initial public offering along with $ 2,500.0 million of cash raised by Churchill in connection with the PIPE Investment and $ 0.4 million of cash held in the Churchill operating cash account.

The gross proceeds were net of $ 0.2 million paid to redeem 21,644 shares of Churchill Class A common stock held by public stockholders and $ 131.4 million in costs incurred by Churchill prior to the Closing.

The Company additionally incurred $ 38.9 million of transaction costs, consisting of banking, legal, and other professional fees, of which $ 36.2 million was recorded as a reduction to additional paid-in capital of proceeds and the remaining $ 2.7 million was expensed in July 2021.

The total net cash proceeds to the Company were $ 4,400.3 million.

(1) Excluded non-cash items of $ 1.5 million for the year ended December 31, 2024 related to the 2024 Restructuring Plan, which was net of accelerated stock-based compensation expense of $ 3.2 million and a reversal of $ 4.7 million related to previously recognized stock-based compensation expenses for unvested restricted stock awards.

(2) Excluded non-cash items of $ 1.4 million for the year ended December 31, 2023 related to the 2023 Restructuring Plan, which was net of accelerated stock-based compensation expense of $ 3.4 million and a reversal of $ 4.8 million related to previously recognized stock-based compensation expenses for unvested restricted stock awards.

As of December 31, 2024 and 2023, restructuring liabilities associated with the restructuring plans included within other current liabilities in the consolidated balance sheet were immaterial.

NOTE 4 – BALANCE SHEETS COMPONENTS

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Inventory as of December 31, 2024 and 2023 was comprised of raw materials, work in progress related to the production of vehicles for sale and SKD units for final assembly in Saudi Arabia, and finished goods inventory including new vehicles available for sale, vehicles in transit to fulfill customer orders, and internally used vehicles which the Company intends to sell.

During the years ended December 31, 2023, 2022, and 2021, the Company recorded write-downs of $ 926.9 million, $ 569.5 million, and $ 48.9 million, respectively, to reduce its inventories to its net realizable values, for any excess or obsolete inventories, and losses from firm purchase commitments.

During the years ended December 31, 2024, 2023, and 2022, the Company recorded write-downs of $ 617.4 million, $ 926.9 million, and $ 569.5 million, respectively, to reduce its inventories to its net realizable values and for any excess or obsolete inventories, as well as losses from firm purchase commitments (“LCNRV”).

Property, plant and equipment, net

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Property, plant and equipment, net $ 3,262,612 $ 2,810,867

(1) As of December 31, 2023, $ 120.2 million of capital expenditure support received from Ministry of Investment of Saudi Arabia (“MISA”) was primarily recorded as a deduction to the AMP-2 building balance.

See Note 20 “Related Party Transactions” for more information.

(2) Included $ 32.5 million of service loaner vehicles as of December 31, 2023.

Construction in progress represents the costs incurred in connection with the construction of buildings or new additions to the Company’s plant facilities including tooling, which is with outside vendors.

(1) As of December 31, 2024 and 2023 , $ 127.5 million and $ 120.2 million of capital expenditure support received from Ministry of Investment of Saudi Arabia (“MISA”) was primarily recorded as a deduction to the AMP-2 building balance, respectively.

See Note 2 “Summary of Significant Accounting Policies” and Note 16 “Related Party Transactions” for more information.

(2) Included $ 39.5 million and $ 32.5 million of service loaner vehicles as of December 31, 2024 and 2023, respectively.

(3) Included $ 34.7 million and $ 9.1 million of operating lease vehicles sold to rental companies as of December 31, 2024 and 2023, respectively.

Construction in progress represents the costs incurred in connection with the construction of buildings or new additions to the Company’s plant facilities, including tooling with outside vendors.

Costs classified as construction in progress include all costs of obtaining the asset, installation of the asset, and bringing it to the location and the condition necessary for its intended use.

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78,254 430,878

Leasehold improvements 25,784 34,797

Leasehold improvements and other

32,422 25,784

Total construction in progress $ 672,534 $ 1,185,413

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Depreciation and amortization expense was $ 295.3 million, $ 233.5 million and $ 186.6 million for the years ended December 31, 2024, 2023 and 2022, respectively.

The amount of interest capitalized on construction in progress related to significant capital asset construction was $ 12.4 million and $ 2.7 million for the years ended December 31, 2023 and 2022, respectively.

No interest was capitalized for the year ended December 31, 2021.

The amount of interest capitalized on construction in progress related to significant capital asset construction was not material for the years ended December 31, 2024, 2023, and 2022, respectively.

Other current liabilities

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Construction in progress 39,043 156,414

Accrued compensation 201,880 92,494

Accrued purchases (1)

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Accrued warranty 36,752 22,677

Deferred revenue (2)

Other current liabilities 221,663 183,114

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(1) Primarily represent accruals for inventory related purchases and transportation charges that had not been invoiced.

(2) Represent deferred revenue from vehicle sales primarily related to OTA and remarketing activities .

Other long-term liabilities

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$ 572,800 $ 524,339

(1) As of December 31, 2023 and 2022, $ 62.5 million and $ 64.0 million, of capital expenditure support received from MISA was recorded as deferred liability within other long-term liabilities in the consolidated balance sheets, respectively.

(1) As of December 31, 2023, $ 62.5 million of capital expenditure support received from MISA was recorded as deferred liability within other long-term liabilities in the consolidated balance sheet.

See Note 2 “Summary of Significant Accounting Policies” and Note 16 “Related Party Transactions” for more information.

(2) As of December 31, 2023, $ 107.8 million of deferred revenue was recorded within other long-term liabilities in the consolidated balance sheet, in connection with the strategic technology and supply arrangement, and integration and supply arrangements with Aston Martin Lagonda Global Holdings plc (together with its subsidiaries, “Aston Martin”).

(2) As of December 31, 2024 and 2023, $ 112.7 million and $ 107.8 million of deferred revenue was recorded within other long-term liabilities in the consolidated balance sheets, respectively, in connection with the strategic technology and supply arrangement, and integration and supply arrangements with Aston Martin Lagonda Global Holdings plc (together with its subsidiaries, “Aston Martin”).

See Note 16 “Related Party Transactions” for more information.

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(1) Provision for warranty for the years ended December 31, 2024 and 2023 included estimated costs related to the recalls identified and/or special campaigns to repair or replace items under warranties.

(2) Accrued warranty balance of $ 22.7 million and $ 10.4 million, respectively, was recorded within other current liabilities, and $ 23.4 million and $ 12.5 million, respectively, was recorded within other long-term liabilities, in the consolidated balance sheets as of December 31, 2023 and 2022.

During the year ended December 31, 2024, the Company recorded $ 46.1 million provision associated with a special warranty campaign.

(2) Accrued warranty balance of $ 36.8 million and $ 22.7 million was recorded within other current liabilities, and $ 75.7 million and $ 23.4 million was recorded within other long-term liabilities, in the consolidated balance sheets as of December 31, 2024 and 2023, respectively.

NOTE 5 - FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS

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Fair value is defined as the price that would be received for an asset or the “exit price” that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between independent market participants on the measurement date.

The Company measures financial assets and liabilities at fair value at each reporting period using a fair value hierarchy, which requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The Company measures certain financial assets and liabilities at fair value at each reporting period using a fair value hierarchy, which requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

A financial instrument classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

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The Company’s short-term and long-term investments are classified as available-for-sale securities.

Carrying amounts of accounts receivable, accounts payable, and other current liabilities approximate their estimated fair values.

The following table sets forth the Company’s financial assets subject to fair value measurements on a recurring basis by level within the fair value hierarchy as of December 31, 2024 and 2023 (in thousands):

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$ 5,040,152 $ 4,127 $ ( 1,088 ) $ 5,043,191 $ 1,606,865 $ 2,424,103 $ 1,012,223

(1) Included $ 35.0 million of time deposit with GIB in short-term investments and long-term investments.

GIB is a related party of the PIF, which is an affiliate of Ayar.

See Note 16 “Related Party Transactions” for more information.

December 31, 2023

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Subtotal 2,732,413 2,480 ( 2,073 ) 2,732,820 803,274 1,638,537 291,009

government agency securities 43,477 46 ( 18 ) 43,505 — 43,505 —

Certificates of deposit 105,993 97 ( 22 ) 106,068 — 106,068 —

Time deposits

50,000 — — 50,000 50,000 — —

Commercial paper 299,248 191 ( 8 ) 299,431 — 299,431 —

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Total $ 4,319,677 $ 3,869 $ ( 2,772 ) $ 4,320,774 $ 1,369,947 $ 2,489,798 $ 461,029

During the years ended December 31, 2023 and 2022, there were immaterial realized gains or losses on the sale of available-for-sale securities.

During the years ended December 31, 2024, 2023, and 2022, there were immaterial gross realized gains or losses on the sale of available-for-sale securities.

Accrued interest receivable excluded from both the fair value and amortized cost basis of the available-for-sale securities was $ 19.6 million and $ 11.1 million as of December 31, 2024 and 2023, respectively, and was recorded in other current assets on its consolidated balance sheets.

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On November 6, 2023, the Company received 28,352,273 ordinary shares of Aston Martin with an initial fair value of $ 73.2 million.

The Company remeasured the shares and recorded fair values of $ 37.8 million and $ 81.5 million within investments in equity securities of a related party in the consolidated balance sheets as of December 31, 2024 and 2023, respectively.

These equity securities are publicly traded stocks (where shares are denominated in GBP) measured at fair value on a recurring basis and classified within level 1 in the fair value hierarchy.

Such equity securities were remeasured to a fair value of $ 81.5 million as of December 31, 2023 and were recorded in other noncurrent assets in the consolidated balance sheet.

During the year ended December 31, 2023, the Company recognized $ 6.0 million of unrealized gain in change in fair value of equity securities in the consolidated statement of operations and comprehensive loss.

During the year ended December 31, 2023, the Company also recognized $ 2.3 million of unrealized foreign currency gain related to these equity securities in other income (expense), net in the consolidated statement of operations and comprehensive loss.

During the years ended December 31, 2024 and 2023, the Company recognized an unrealized loss of $ 43.1 million and an unrealized gain of $ 6.0 million, respectively, in change of fair value of equity securities of a related party in the consolidated statement of operations and comprehensive loss.

During the years ended December 31, 2024 and 2023, the Company also recognized $ 0.6 million of unrealized foreign currency loss and $ 2.3 million of unrealized foreign currency gain related to these equity securities, respectively, in other income (expense), net in the consolidated statement of operations and comprehensive loss.

See Note 16 “Related Party Transactions” for more information.

Level 3 liabilities consist of common stock warrant liability of which the fair value was measured upon issuance and is remeasured at each reporting date.

Level 3 liabilities also consist of residual value guarantee liabilities, of which the fair value measurement is nonrecurring and measured upon delivery of vehicles.

The valuation methodology and underlying assumptions are discussed further in Note 2 “Summary of Significant Accounting Policies” and Note 10 “Common Stock Warrant Liability”.

Significant increases (decreases) in the unobservable inputs used in determining the fair value would result in a significantly higher (lower) fair value measurement.

Level 3 liabilities consist of the common stock warrant liability and the derivative liabilities associated with the Redeemable Convertible Preferred Stock, of which the fair values were measured upon issuance of the Private Placement Warrants and the Redeemable Convertible Preferred Stock and are remeasured at each reporting period.

The valuation methodology and underlying assumptions are discussed further in Note 7 “Common Stock Warrant Liability” and Note 8 “Redeemable Convertible Preferred Stock”, respectively.

Level 3 liabilities also consist of residual value guarantee liabilities, of which the fair value is measured initially upon delivery of vehicles and assessed subsequently for any changes on a quarterly basis.

Significant changes in the unobservable inputs used in determining the fair value would result in significant changes to the fair value measurement.

The following table presents a reconciliation of the common stock warrant liability measured and recorded at fair value on a recurring basis (in thousands):

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Fair value-end of period $ 19,514 $ 53,664

The following table presents a reconciliation of the derivative liabilities associated with the Redeemable Convertible Preferred Stock measured and recorded at fair value on a recurring basis (in thousands):

Year Ended December 31, 2024

Series A Derivative Liability

Series B Derivative Liability

Fair value-beginning of period $ — $ —

497,100 297,675

Change in fair value ( 88,300 ) ( 67,050 )

Fair value-end of period $ 408,800 $ 230,625

NOTE 6 – DEBT

In December 2021, the Company issued an aggregate of $ 2,012.5 million principal amount of 1.25 % convertible senior notes due in December 2026 (the “2026 Notes”) in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended, at an issuance price equal to 99.5 % of the principal amount of 2026 Notes.

The 2026 Notes have been designated as green bonds, whose proceeds will be allocated in accordance with the Company’s green bond framework.

The Company has designated the 2026 Notes as green bonds, whose proceeds will be allocated in accordance with the Company’s green bond framework.

The 2026 Notes were issued pursuant to and are governed by an indenture dated December 14, 2021, between the Company and U.S.

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The proceeds from the issuance of the 2026 Notes were $ 1,986.6 million, net of the issuance discount and debt issuance costs.

The 2026 Notes are unsecured obligations which bear regular interest at 1.25 % per annum and will be payable semiannually in arrears on June 15 and December 15 of each year, beginning on June 15, 2022.

The 2026 Notes are unsecured obligations which bear regular interest at 1.25 % per annum and are payable semiannually in arrears on June 15 and December 15 of each year, beginning on June 15, 2022.

The 2026 Notes will mature on December 15, 2026, unless repurchased, redeemed, or converted in accordance with their terms prior to such date.

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Holders of the 2026 Notes may convert all or a portion of their 2026 Notes at their option prior to September 15, 2026, in multiples of $1,000 principal amounts, only under the following circumstances:

• during any calendar quarter commencing after the quarter ending on March 31, 2022 (and only during such calendar quarter), if the Company’s common stock price exceeds 130 % of the conversion price for at least 20 trading days during the 30 consecutive trading days at the end of the prior calendar quarter;

• during any calendar quarter commencing after the quarter ended on March 31, 2022 (and only during such calendar quarter), if the Company’s common stock price exceeds 130 % of the conversion price for at least 20 trading days during the 30 consecutive trading days at the end of the prior calendar quarter;

• during the five consecutive business days immediately after any 10 consecutive trading day period in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day;

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Fair Value (Level 2) $ 1,579.8 $ 1,061.6

The effective interest rate for the convertible note is 1.5 %.

The effective interest rate for the 2026 Notes is 1.5 %.

The components of interest expense related to the 2026 Notes were as follows (in millions):

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SIDF Loan Agreement

On February 27, 2022, Lucid, LLC, a limited liability company established in Saudi Arabia and a subsidiary of the Company (“Lucid LLC”) entered into a loan agreement (as subsequently amended, the “SIDF Loan Agreement”) with SIDF, a related party of Public Investment Fund (“PIF”), which is an affiliate of Ayar.

On February 27, 2022, Lucid LLC entered into a loan agreement (as subsequently amended, the “SIDF Loan Agreement”) with SIDF, a related party of the PIF, which is an affiliate of Ayar.

Under the SIDF Loan Agreement, SIDF has committed to provide loans (the “SIDF Loans”) to Lucid LLC in an aggregate principal amount of up to SAR 5.19 billion (approximately $ 1.4 billion);

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On April 29, 2022, Lucid LLC entered into the GIB Facility Agreement with GIB, maturing on February 28, 2025.

GIB is a related party of PIF, which is an affiliate of Ayar.

GIB is a related party of the PIF, which is an affiliate of Ayar.

The GIB Facility Agreement provided for two committed revolving credit facilities in an aggregate principal amount of SAR 1.0 billion (approximately $ 266.1 million).

SAR 650 million (approximately $ 173.0 million) under the GIB Facility Agreement was available as the Bridge Facility for the financing of Lucid LLC’s capital expenditures in connection with AMP-2.

The remaining SAR 350 million (approximately $ 93.1 million) was available as the Working Capital Facility and might be used for general corporate purposes.

The remaining SAR 350 million (approximately $ 93.1 million) was available as the Working Capital Facility and may be used for general corporate purposes.

Loans under the Bridge Facility and the Working Capital Facility had a maturity of no more than 12 months.

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Commitments under the 2023 Amended GIB Facility Agreement will terminate, and all amounts then outstanding thereunder would become payable, on the maturity date of the 2023 Amended GIB Facility Agreement.

The commitment fees for the years ended December 31, 2024, 2023, and 2022 were immaterial .

The 2023 Amended GIB Facility Agreement contains certain conditions precedent to drawdowns, representations and warranties and covenants of Lucid LLC and events of default.

As of December 31, 2023, the Company had outstanding borrowings of SAR 272 million (approximately $ 72.5 million) with weighted average interest rate of 7.49 %.

As of December 31, 2023, availability under the GIB Credit Facility was SAR 727 million (approximately $ 193.9 million), after giving effect to the outstanding letters of credit.

As of December 31, 2022 , the Company had outstanding borrowings of SAR 36 million (approximately $ 9.6 million) with interest rate of 6.40 % from the Working Capital Facility.

As of December 31, 2022, available borrowings were SAR 650 million (approximately $ 173.0 million) and SAR 314 million (approximately $ 83.5 million) under the Bridge Facility and Working Capital Facility, respectively.

As of December 31, 2024 and 2023, the Company had outstanding borrowings of SAR 475 million (approximately $ 126.4 million) and SAR 272 million (approximately $ 72.5 million), respectively.

The weighted average interest rate on the outstanding borrowings was 7.04 % and 7.49 % as of December 31, 2024 and 2023, respectively.

As of December 31, 2024 and 2023, availability under the 2023 GIB Credit Facility was SAR 523 million (approximately $ 139.2 million) and SAR 727 million (approximately $ 193.9 million), respectively, after giving effect to the outstanding letters of credit.

The outstanding borrowings were recorded within other current liabilities in the consolidated balance sheets.

The Company recorded interest expenses of SAR 8 million (approximately $ 2.2 million) for the year ended December 31, 2023.

The Company recorded interest expense of SAR 18 million (approximately $ 4.9 million) and SAR 8 million (approximately $ 2.2 million) for the years ended December 31, 2024 and 2023, respectively.

The interest expense recorded for the year ended December 31, 2022 was immaterial .

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Borrowings under the ABL Credit Facility bear interest at the applicable interest rates specified in the credit agreement governing the ABL Credit Facility.

In June 2024, the Company amended the ABL Credit Facility to update the Canadian reference rate.

Availability under the ABL Credit Facility is subject to the value of eligible assets in the borrowing base and is reduced by outstanding loan borrowings and issuances of letters of credit which bear customary letter of credit fees.

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The ABL Credit Facility contains customary covenants that limit the ability of the Company and its restricted subsidiaries to, among other activities, pay dividends, incur debt, create liens and encumbrances, redeem or repurchase stock, dispose of certain assets, consummate acquisitions or other investments, prepay certain debt, engage in transactions with affiliates, engage in sale and leaseback transactions or consummate mergers and other fundamental changes.

The ABL Credit Facility also includes a minimum liquidity covenant which, at the Company’s option following satisfaction of certain pre-conditions, may be replaced with a springing, minimum fixed charge coverage ratio (“FCCR”) financial covenant, in each case on terms set forth in the credit agreement governing the ABL Credit Facility.

The ABL Credit Facility also includes a minimum liquidity covenant which, at the Company’s option following satisfaction of certain pre-conditions, may be replaced with a springing, minimum fixed charge coverage ratio financial covenant, in each case on terms set forth in the credit agreement governing the ABL Credit Facility.

As of December 31, 2024 and 2023, the Company was in compliance with applicable covenants under the ABL Credit Facility.

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The Company incurred issuance costs of $ 6.3 million to obtain the ABL Credit Facility, which was capitalized within other noncurrent assets in the consolidated balance sheets and amortized over the facility term using the straight-line method.

The Company recorded amortization of the deferred issuance costs and commitment fee of $ 3.7 million and $ 2.1 million for the years ended December 31, 2023 and 2022, respectively.

NOTE 8 - CONTINGENT FORWARD CONTRACTS

In September 2020, the Company and Ayar entered into a stock purchase agreement for the Company’s Series E convertible preferred stock (the “Series E Preferred Stock Purchase Agreement”).

In February 2021, the Company and Ayar entered into Amendment No.

1 to the Series E Preferred Stock Purchase Agreement (“Amendment No.

Under the Amendment No.

1, Ayar and the Company agreed to enter into the third closing of additional 133,818,821 Series E convertible preferred stock at $ 2.99 per share, aggregating to $ 400.0 million.

Upon the signing of the Amendment No.

1, the Company received the issuance proceeds of $ 400.0 million from Ayar in February 2021.

Amendment No.

1 also allowed the Company to provide an opportunity to all current convertible preferred stockholders other than Ayar (“Eligible Holders”) to enter into the fourth closing to purchase up to 23,737,221 shares of Series E convertible preferred stock on a pro rata basis at $ 2.99 per share, aggregating to $ 71.0 million.

In addition, the amendment allowed the Company to offer for purchase at the fourth closing at $ 2.99 per share, a number of Series E Preferred Stock to senior management employees, directors, consultants, advisors and/or contractors of the Company (“Additional Purchasers”) and Ayar.

Refer to Note 11 “Convertible Preferred Stock”.

In April 2021, the Company issued 66,909,408 Series E convertible preferred stock from the fourth closing at $ 2.99 per share for cash consideration of $ 200.0 million.

The Company received $ 107.1 million of the total issuance proceeds in March 2021 and the remaining $ 92.9 million in April 2021.

See Note 11 “Convertible Preferred Stock” for more information.

The Company determined the right to participate in future Series E convertible preferred share financing to be a freestanding financial instrument similar to a derivative liability in the form of contingent forward contracts and recorded the initial valuation of $ 1,444.9 million and $ 722.4 million for the third closing and fourth closing, respectively, as contingent forward contract liabilities.

Since the contingent forward contract liability related to the third closing was fully settled in the same month following the execution of the amendment, the Company recorded no related fair value remeasurements in the consolidated statements of operations and comprehensive loss.

The Company issued Offer Notices to certain of the Company’s management and members of the Board of Directors in March 2021 and April 2021.

The Series E convertible preferred stock issued from the fourth closing included 3,034,194 shares to the Company’s management and 1,658,705 shares to members of the Board of Directors.

The total issuance to the Company’s management included 535,275 shares offered to the CEO in April 2021.

The offer to employees in the fourth closing to participate in future Series E convertible preferred stock financing represents a fully vested, equity classified award.

The Company recorded the award’s full fair value on each recipient’s grant date as stock-based compensation, and derecognized the related contingent forward contract liability.

The Company revalued the contingent forward contract liability for the remaining participants and recorded $ 454.5 million fair value remeasurement loss related to the contingent forward contract liability for the year ended December 31, 2021, with the final fair value of the contingent forward contract liability of $ 1.2 billion reclassified into Series E convertible preferred stock upon the fourth closing in April 2021.

There was no related outstanding contingent forward contract liability as of December 31, 2021.

The fair value of the Series E convertible preferred stock contingent forward contract liability for the third closing was determined using a forward payoff.

The Company’s inputs used in determining the fair value on the issuance date and settlement date, were as follows:

Stock Price $ 13.79

Volatility 100.00 %

Expected term (in years) 0.01

Risk-free rate 0.03 %

The fair value of the Series E convertible preferred stock contingent forward contract liability for the fourth closing was determined using a forward and an option payoff.

The Company’s inputs used in determining the fair value on the issuance date were as follows:

Fair value of Series E convertible preferred share $ 13.79

Volatility 100.00 %

Expected term (in years) 0.11

Risk-free rate 0.03 %

The fair value of the Series E convertible preferred stock contingent forward contract liability for the fourth closing was determined as the difference between the Series E convertible preferred stock fair value and the purchase price.

The Company estimated the fair value of each of the Series E convertible preferred stock on the settlement date by taking the closing price of Churchill’s Class A common stock on April 1, 2021 of $ 23.78 multiplied by the expected exchange ratio at the time, and discounted for lack of marketability.

NOTE 9 - CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY

The Company’s issued and outstanding convertible preferred stock warrants to purchase a total of 1,546,799 shares of Series D convertible preferred stock, with an exercise price of $ 1.94 per share were recorded at fair value using a Monte-Carlo simulation at issuance and have been subsequently remeasured to fair value each reporting period with the changes recorded in the consolidated statements of operations and comprehensive loss.

In February 2021, all the outstanding convertible preferred stock warrants were settled in its entirety at an exercise price of $ 1.94 per share for an aggregate purchase price of $ 3.0 million.

Upon final settlement, the Company converted the warrant into $ 12.9 million Series D convertible preferred stock, and recorded $ 7.0 million losses related to fair value remeasurements of the warrants in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2021.

The Company recorded amortization of the deferred issuance costs and commitment fee of $ 3.7 million for the years ended December 31, 2024 and 2023, and $ 2.1 million for the year ended December 31, 2022.

DDTL Credit Facility

In August 2024, the Company entered into the DDTL Credit Facility with Ayar, that may be used for working capital and general corporate purposes.

The DDTL Credit Facility provides for a delayed draw term loan credit facility in an aggregate principal amount of $ 750.0 million and has a stated maturity date of August 4, 2029.

Borrowings under the DDTL Credit Facility bear interest at the applicable interest rates specified in the credit agreement governing the DDTL Credit Facility.

The Company is required to pay a quarterly undrawn fee of 0.50 % per annum based on the unutilized portion of the DDTL Credit Facility.

The DDTL Credit Facility contains customary covenants that limit the ability of the Company and its restricted subsidiaries to, among other activities, pay dividends, incur debt, create liens and encumbrances, redeem or repurchase stock, dispose of certain assets, consummate acquisitions or other investments, prepay certain debt, engage in sale and leaseback transactions or consummate mergers and other fundamental changes.

The DDTL Credit Facility also includes a minimum liquidity covenant.

As of December 31, 2024, the Company was in compliance with applicable covenants under the DDTL Credit Facility.

As of December 31, 2024, the Company had no outstanding borrowings under the DDTL Credit Facility.

The Company incurred issuance costs of $ 6.2 million to obtain the DDTL Credit Facility, which was capitalized within other noncurrent assets in the consolidated balance sheet and amortized over the facility term using the straight-line method.

The Company recorded amortization of the deferred issuance costs and commitment fee of $ 2.1 million for the year ended December 31, 2024.

NOTE 7 - COMMON STOCK WARRANT LIABILITY

On July 23, 2021, in connection with the reverse recapitalization treatment of the Merger, the Company effectively issued 44,350,000 Private Placement Warrants to purchase shares of Lucid’s common stock at an exercise price of $ 11.50 .

The Private Placement Warrants were initially recognized as a liability with a fair value of $ 812.0 million and was remeasured to fair value of $ 140.6 million as of December 31, 2022.

The Private Placement Warrants remained unexercised and were remeasured to fair value of $ 53.7 million as of December 31, 2023.

The Company recognized gains of $ 86.9 million and $ 1,254.2 million, and a loss of $ 582.8 million for the years ended December 31, 2023, 2022 and 2021, respectively, in the consolidated statements of operations and comprehensive loss.

The 44,350,000 Private Placement Warrants included the 14,783,333 Sponsor Earnback Warrants subject to the contingent forfeiture provisions.

The earnback triggering events were satisfied during the year ended December 31, 2021 such that the 14,783,333 Sponsor Earnback Warrants vested and are no longer subject to the transfer restrictions and contingent forfeiture provisions.

See Note 13 “Earnback Shares and Warrants” for more information.

The Company initially estimated the fair value of the Private Placement Warrants that were subject to the contingent forfeiture provisions using a Monte-Carlo simulation which estimates a distribution of potential outcomes over the earnback period related to the achievement of the volume-weighted average trading sale price (the “VWAP”) thresholds.

The present value of the payoff in each simulation is calculated, and the fair value of the liability is determined by taking the average of all present values.

The fair value of the Private Placement Warrants that were subject to the contingent forfeiture provisions were as follows:

July 23, 2021

Fair value of Tranche 1 with $ 20.00 VWAP threshold per share

Fair value of Tranche 2 with $ 25.00 VWAP threshold per share

Fair value of Tranche 3 with $ 30.00 VWAP threshold per share

The fair value of the Private Placement Warrants that are not subject to the contingent forfeiture provisions was estimated using a Black-Scholes option pricing model, and were as follows:

On July 23, 2021, in connection with the merger, the Company effectively issued 44,350,000 Private Placement Warrants to purchase shares of Lucid’s common stock at an exercise price of $ 11.50 .

The Private Placement Warrants were initially recognized as a liability with a fair value of $ 812.0 million and was remeasured to a fair value of $ 53.7 million as of December 31, 2023.

The Private Placement Warrants remained unexercised and were remeasured to a fair value of $ 19.5 million as of December 31, 2024.

The Company recognized gains of $ 34.2 million, $ 86.9 million, and $ 1,254.2 million for the years ended December 31, 2024, 2023 and 2022, respectively, in the consolidated statements of operations and comprehensive loss.

The fair value of the Private Placement Warrants that are not subject to the contingent forfeiture provisions was estimated using a Black-Scholes option pricing model, and was as follows:

December 31, 2024 December 31, 2023

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Assumptions used in the Black-Scholes option pricing model take into account the contract terms as well as the quoted price of the Company’s common stock in an active market.

The volatility is based on the actual market activity of the Company’s peer group as well as the Company’s historical volatility.

The volatility is primarily based on the Company’s historical volatility.

The expected life is based on the remaining contractual term of the warrants, and the risk-free interest rate is based on the implied yield available on U.S.

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Dividend yield — % — %

NOTE 11 – CONVERTIBLE PREFERRED STOCK

Convertible Preferred Stock

Upon the Closing of the Merger, the Company cancelled and converted all 1,155,909,367 shares of issued and outstanding convertible preferred stock into 1,155,909,367 shares of Lucid common stock based upon the conversion rate as calculated pursuant to Legacy Lucid’s memorandum and articles of association at the date and time that the Merger became effective.

As of December 31, 2023 and 2022, there were no issued and outstanding shares of convertible preferred stock.

In 2014 through April 2021, the Company had issued Series A, Series B, Series C, and Series D and Series E convertible preferred stock (“Series A,” “Series B,” “Series C,” “Series D,” “Series E,” respectively) (collectively, the “Convertible Preferred Stock”).

Convertible Preferred Stock was carried at its issuance price, net of issuance costs.

Fifth Company Repurchase (Series B - December 2020)

On December 22, 2020, the Company repurchased 3,525,332 Series B convertible preferred stock for a total of $ 3.0 million.

The Company recognized $ 1.0 million in additional paid-in capital in the consolidated balance sheet as of December 31, 2020, related to the difference in fair value of the consideration payable and the $ 4.0 million aggregate carrying value of the Series B shares repurchased.

As of the date of extinguishment and as of December 31, 2020, the Series B convertible preferred stock subject to repurchase had been mandatorily redeemable within 45 days of the agreement and accordingly had been reclassified to other current liabilities in the consolidated balance sheet.

Series E Convertible Preferred Stock Issuance

In February 2021, the Company and Ayar entered into Amendment No.

1 to the original Series E Preferred Stock Purchase Agreement (“Amendment No.

Under the Amendment No.

1, Ayar and the Company agreed to enter into the third closing of additional 133,818,821 shares of Series E convertible preferred stock at $ 2.99 per share, aggregating to $ 400.0 million.

Upon the signing of the Amendment No.

1, the Company received the issuance proceeds of $ 400.0 million from Ayar in February 2021.

Amendment No.

The aggregate number of Series E Preferred Stock sold at the third closing and fourth closing would not exceed 200.7 million shares (“Extension Amount”).

Ayar committed to purchase the entire Extension Amount to the extent not subscribed by Eligible Holders or Additional Purchasers.

In April 2021, the Company issued 66,909,408 Series E convertible preferred stock from the fourth closing at $ 2.99 per share for cash consideration of $ 200.0 million.

The Company received $ 107.1 million of the entire cash consideration in March 2021, and the remaining $ 92.9 million in April 2021.

The Company issued Offer Notices to certain of the Company’s management and members of the Board of Directors in March 2021 and April 2021.

The Series E convertible preferred stock issued from the fourth closing included 3,034,194 shares to the Company’s management and 1,658,705 shares to members of the Board of Directors.

The total issuance to the Company’s management includes 535,275 shares offered to the CEO in April 2021.

The offer to employees to participate in a future Series E convertible preferred stock financing represented a fully vested, equity classified award.

The excess of the award’s fair value over the purchase price of $ 123.6 million on each recipient’s grant date during the year ended December 31, 2021 was recorded as stock-based compensation.

Along with the execution of Amendment No.

1, the Company also increased the authorized number of common shares and convertible preferred stock to 1,316,758,889 and 1,155,909,398 stock, respectively.

NOTE 8 – REDEEMABLE CONVERTIBLE PREFERRED STOCK

In March 2024, the Company entered into the Series A Subscription Agreement with Ayar.

Pursuant to the Series A Subscription Agreement, Ayar agreed to purchase from the Company 100,000 shares of the Series A Redeemable Convertible Preferred Stock for an aggregate purchase price of $ 1.0 billion in a private placement.

Subsequently, in March 2024, the Company issued the shares to Ayar pursuant to the Series A Subscription Agreement and received aggregate gross proceeds of $ 1.0 billion.

In August 2024, the Company entered into the Series B Subscription Agreement with Ayar.

Pursuant to the Series B Subscription Agreement, Ayar agreed to purchase from the Company 75,000 shares of the Series B Redeemable Convertible Preferred Stock for an aggregate purchase price of $ 750.0 million in a private placement.

Subsequently, in August 2024, the Company issued the shares to Ayar pursuant to the Series B Subscription Agreement and received aggregate gross proceeds of $ 750.0 million.

The shares of the Series A Redeemable Convertible Preferred Stock and the Series B Redeemable Convertible Preferred Stock were issued pursuant to the Series A Certificate of Designations and the Series B Certificate of Designations (the “Certificate of Designations”), respectively.

Pursuant to the Series A Subscription Agreement and the Series B Subscription Agreement, Ayar has agreed, with certain exceptions, that without prior written consent of the Company, it will not sell or transfer the Redeemable Convertible Preferred Stock for the twelve months after the date of the closing of the respective private placement.

The Redeemable Convertible Preferred Stock ranks senior to the common stock with respect to dividends and distributions of assets upon the Company’s liquidation, dissolution or winding up.

The Redeemable Convertible Preferred Stock has an initial value of $ 10,000 per share (the “Initial Value” and the Initial Value plus compounded and accrued dividends, the “Accrued Value”).

Dividends on the Redeemable Convertible Preferred Stock are payable in the form of compounded cumulative dividends upon each share of the Redeemable Convertible Preferred Stock (paid-in-kind).

Dividends accrue daily on the Initial Value (as increased for any compounded dividends previously compounded thereon) of each share of the Redeemable Convertible Preferred Stock at a rate of 9 % per annum and compound on the basis of quarterly dividend payment dates on each March 31, June 30, September 30 and December 31 of each year, commencing June 30, 2024 for the Series A Redeemable Convertible Preferred Stock and September 30, 2024 for the Series B Redeemable Convertible Preferred Stock.

Liquidation Preference:

Upon a liquidation, dissolution or winding up of the Company, each holder of shares of the Redeemable Convertible Preferred Stock (“Holder”) will be entitled to receive, with respect to each share of then-outstanding Redeemable Convertible Preferred Stock, out of the assets of the Company available for distribution to its stockholders an amount in cash equal to the greater of (a) an amount per share of the Redeemable Convertible Preferred Stock as of the date of such liquidation, dissolution or winding up equal to (i) the per share Accrued Value as of the relevant date multiplied by (ii) the relevant percentage (the product of (i) and (ii), the “Minimum Consideration”);

and (b) the amount that such Holder would have received with respect to such share of the Redeemable Convertible Preferred Stock if all shares of the Redeemable Convertible Preferred Stock had been converted at their Accrued Value into shares of common stock on the business day immediately prior to the date of such liquidation, dissolution or winding up.

As of December 31, 2024, the liquidation preference of the Series A Redeemable Convertible Preferred Stock and Series B Redeemable Convertible Preferred Stock was $ 1,138.8 million and $ 800.4 million, respectively.

Voting Rights:

Each Holder is entitled to the number of votes equal to the number of whole shares of common stock into which the aggregate shares of the Redeemable Convertible Preferred Stock held by such Holder are convertible on the record date for determining stockholders entitled to vote on any matter presented to the stockholders of the Company for their action or consideration at any meeting of stockholders and on which matter holders of the common stock shall be entitled to vote.

Holders are entitled to notice of any meeting of stockholders and, except as otherwise provided in the Certificate of Designations or otherwise required by law, to vote together as a single class with the holders of the common stock and any other class or series of stock entitled to vote thereon.

The voting power of Holders is subject to a voting cap per share equal to the quotient of the $ 10,000 Initial Value and the minimum price ($ 2.77 for the Series A Redeemable Convertible Preferred Stock and $ 3.12 for the Series B Redeemable Convertible Preferred Stock).

As long as at least 10 % of the aggregate number of shares issued on the respective initial issue date remain outstanding, and subject to certain other conditions, Holders are entitled to a separate class vote with respect to, among other things, amendments to the Company’s organizational documents that have an adverse effect on the Redeemable Convertible Preferred Stock, authorizations or issuances by the Company of capital stock of the Company that ranks senior or equal to the Redeemable Convertible Preferred Stock with respect to dividends or distributions on liquidation or the terms of which provide for cash dividends (other than the common stock), winding-up and dissolution, and decreases in the number of authorized shares of the Redeemable Convertible Preferred Stock.

The Company also agreed that as long as Ayar owns at least 50 % of the shares issued on the respective initial issue date, the Company will comply with certain debt incurrence covenants in its Credit Agreement, dated as of June 9, 2022, by and among the Company, as the Borrower Representative, the other Borrowers party thereto from time-to-time, the Lenders and Issuing Banks from time-to-time party thereto and Bank of America, N.A., as Administrative Agent, as amended, which agreement may be waived with the sole consent of Ayar.

Each share of the Redeemable Convertible Preferred Stock is convertible, at the option of the respective Holder, from time-to-time after the initial issue date, and without the payment of additional consideration by the Holder, (a) at any time that the closing price per share of the common stock on the trading day immediately preceding the date on which the Holder delivers the relevant notice of conversion is at least $ 5.50 (subject to certain adjustments), unless the Company otherwise consents to such conversion in its sole discretion, or (b) in all events during certain specified periods relating to a fundamental change or optional redemption by the Company, into such number of fully paid and non-assessable shares of common stock as is determined by dividing (i) the applicable Accrued Value as of the conversion date by (ii) the applicable conversion price in effect as of such conversion date, which shall initially be $ 3.5952 for the Series A Redeemable Convertible Preferred Stock and $ 4.3799 for the Series B Redeemable Convertible Preferred Stock, subject to customary anti-dilution adjustments, including in the event of any stock split, stock dividend, recapitalization or similar events (the “Conversion Price”).

Mandatory Conversion:

On or after the third anniversary of the initial issue date, if at any time (i) the daily VWAP of the common stock has been at least 200 % of the Conversion Price for at least twenty ( 20 ) trading days (whether or not consecutive) during any thirty ( 30 ) consecutive trading days (including the last day of such period) and (ii) certain common stock liquidity conditions are satisfied, the Company will have the right, exercisable at its election within fifteen ( 15 ) business days following completion of the applicable thirty ( 30 ) trading day period, to cause all or any portion of the Redeemable Convertible Preferred Stock to convert into number of fully paid and non-assessable shares of common stock, as determined by dividing (i) the applicable Accrued Value as of the conversion date by (ii) the Conversion Price in effect as of such conversion date.

The Company will be required to pay an additional amount per share of the Redeemable Convertible Preferred Stock payable in cash, shares of common stock valued based on a five-day average daily VWAP or a combination thereof in respect of such conversion equal to the greater of (x) the difference between (i) the Minimum Consideration and (ii) the value of the shares of common stock delivered upon mandatory conversion thereof and (y) zero.

Fundamental Change:

Upon a fundamental change, the Holders will be entitled, on the fundamental change repurchase date specified by the Company, to receive an amount equal to the greater of (a) the Minimum Consideration and (b) an amount equal to the value that such Holder would have received if it had converted its shares of the Redeemable Convertible Preferred Stock into shares of common stock on the business day immediately before the fundamental change repurchase date.

The fundamental change repurchase price may be paid in cash, shares of common stock (or other securities to be received by a holder of common stock in such fundamental change) valued based on a five-day average daily VWAP (with the number of shares of common stock rounded up to the nearest whole share), or a combination thereof, at the Company’s election.

The Company may not elect to deliver shares of its common stock (or other securities to be received by a holder of common stock in such fundamental change) in partial or full satisfaction of the fundamental change repurchase price, if certain common stock liquidity conditions are not satisfied.

Optional Redemption:

On or after the fifth anniversary of the initial issue date, the Company may redeem all or any portion of the Redeemable Convertible Preferred Stock at a redemption price per share equal to the greater of (a) the Minimum Consideration and (b) an amount equal to the value (calculated based on a twenty ( 20 )-day average daily VWAP) of the number of shares of common stock if it had converted its shares of the Redeemable Convertible Preferred Stock into shares of common stock as of the redemption date.

Such redemption price may be paid in cash, shares of common stock valued based on a twenty ( 20 )-day average daily VWAP, or a combination thereof, at the Company’s election.

The Company may not pay any portion of such redemption price in shares of common stock if the common stock liquidity conditions are not satisfied.

While the Redeemable Convertible Preferred Stock is callable after five years at the Company’s option, the Redeemable Convertible Preferred Stock is considered redeemable at the option of Ayar and was classified as mezzanine equity, because it is the majority shareholder of the Company.

The Company recorded the Series A Redeemable Convertible Preferred Stock initially at its issuance price, net of issuance costs of $ 2.4 million and net of the initial value of the bifurcated derivative liability of $ 497.1 million.

The Company also recorded the Series B Redeemable Convertible Stock initially at its issuance price, net of issuance costs of $ 0.6 million and net of the initial value of the bifurcated derivative liability of $ 297.7 million.

The Company accretes the Redeemable Convertible Preferred Stock to its redemption value, which is greater of (a) the Minimum Consideration and (b) an amount equal to the value that such Holder would have received if it had converted its shares of the Redeemable Convertible Preferred Stock into shares of common stock as of the Redemption Date.

During the year ended December 31, 2024, the Company recorded accretion of $ 229.5 million and $ 118.1 million related to the Series A Redeemable Convertible Preferred Stock and the Series B Redeemable Convertible Preferred Stock, respectively.

Accretion of the Redeemable Convertible Preferred Stock was reflected as adjustments to additional paid-in capital in the consolidated balance sheet as of December 31, 2024.

The carrying value of the Series A Redeemable Convertible Preferred Stock and Series B Redeemable Convertible Preferred Stock was $ 730.0 million and $ 569.8 million as of December 31, 2024, respectively.

The Company assessed the above features to determine whether any features are required to be bifurcated and separately accounted for as an embedded feature.

The Company concluded that the conversion features, inclusive of all settlement outcomes where the pay-off is indexed to the if-converted value, meets all the requirements to be separately accounted for as a bifurcated derivative.

As a result, the Company bifurcated the Redeemable Convertible Preferred Stock between (i) the host contracts which are accounted for within mezzanine equity as described above, and (ii) the bifurcated derivative liabilities related to the conversion features.

The proceeds from issuance were first allocated to the fair value of the bifurcated derivatives with the residual being allocated to the host contracts.

The bifurcated derivatives are remeasured to fair value at each reporting period with changes in fair value recorded in the consolidated statement of operations and comprehensi ve loss .

As of December 31, 2024, the derivative liabilities for the Redeemable Convertible Preferred Stock were remeasured to fair value of $ 639.4 million, comprising of $ 408.8 million related to Series A Redeemable Convertible Preferred Stock and $ 230.6 million related to Series B Redeemable Convertible Preferred Stock.

The Company recognized gains of $ 155.4 million for the year ended December 31, 2024 in change in fair value of derivative liabilities associated with redeemable convertible preferred stock (related party) in the consolidated statements of operations and comprehensive loss.

The Company estimated the fair value of the derivative liabilities using a binomial lattice model with the volatility, credit spread, and term as significant unobservable inputs.

Assumptions used in the valuation also take into account the contractual terms as well as the quoted price of the Company’s common stock in an active market.

Significant changes in any of those inputs in isolation would result in significant changes to the fair value measurement.

The level 3 fair value inputs used in the valuation of the derivative liabilities associated with the Redeemable Convertible Preferred Stock were as follows:

December 31, 2024

Derivative Liability

40.0 % 40.0 %

Credit spread

17.9 % 17.9 %

$ 3.02 $ 3.02

Term (in years)

Risk-free rate

NOTE 9 – STOCKHOLDERS’ EQUITY

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The Company has authorized the issuance of 10,000,000 shares of undesignated preferred stock with a par value of $ 0.0001 per share with rights and preferences, including voting rights, designated from time-to-time by the Board of Directors.

As of December 31, 2023 and 2022, there were no issued and outstanding shares of preferred stock.

On July 23, 2021, in connection with the reverse recapitalization treatment of the Merger, the Company effectively issued 425,395,023 new shares of common stock upon the Closing.

The Company also converted all 1,155,909,367 shares of its issued and outstanding convertible preferred stock into 1,155,909,367 new shares of common stock as of the Closing of the Merger based upon the conversion rate as calculated pursuant to Legacy Lucid’s memorandum and articles of association.

Immediately following the Merger, there were 1,618,621,534 shares of common stock outstanding with a par value of $ 0.0001 .

The holder of each share of common stock is entitled to one vote.

As of December 31, 2024, there were 100,000 and 75,000 issued and outstanding shares of Series A Redeemable Convertible Preferred Stock and Series B Redeemable Convertible Preferred Stock, respectively.

There were no issued and outstanding shares of preferred stock as of December 31, 2023.

On November 8, 2022, the Company entered into the Equity Distribution Agreement with BofA Securities, Inc., Barclays Capital Inc.

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In June 2023, the Company issued the shares to Ayar pursuant to the 2023 Subscription Agreement and received aggregate net proceeds of $ 1.8 billion after deducting issuance costs of $ 2.0 million.

On October 16, 2024, the Company entered into the 2024 Underwriting Agreement with the Underwriter, under which the Underwriter agreed to purchase 262,446,931 shares of the Company’s common stock.

The Company also granted the Underwriter an Overallotment Option to purchase additional shares.

On October 17, 2024, the Underwriter exercised the Overallotment Option to purchase an additional 15,037,594 shares.

On October 18, 2024, the Company completed the public offering pursuant to the 2024 Underwriting Agreement at a price per share of $ 2.59 , and received aggregate net proceeds of $ 718.4 million after deducting issuance costs of $ 0.6 million.

On October 16, 2024, the Company entered into the 2024 Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company 374,717,927 shares of the Company’s common stock.

In addition, given the Underwriter’s exercise of the Overallotment Option, Ayar agreed to purchase an additional 21,470,459 shares of the Company’s common stock.

As of October 31, 2024, the Company consummated the private placement of shares to Ayar pursuant to the 2024 Subscription Agreement at a price per share of $ 2.59 , for aggregate net proceeds of $ 1,025.7 million after deducting issuance costs of $ 0.8 million.

Issuance costs incurred were recorded as a reduction of the gross proceeds received from the equity offerings within additional paid-in capital in the consolidated balance sheets.

Common Stock Warrants

On July 23, 2021, in connection with the reverse recapitalization treatment of the Merger, the Company effectively issued 41,400,000 publicly-traded warrants to purchase shares of its common stock.

Each whole warrant entitled the holder to purchase one share of the Company’s common stock at a price of $ 11.50 per share.

The Public Warrants were exercisable as of August 22, 2021 and expire on July 23, 2026, if not yet exercised by the holder or redeemed by the Company.

During the year ended December 31, 2021, an aggregate of 41,034,197 Public Warrants were exercised, of which 25,966,976 were exercised on a cashless basis.

The aggregate cash proceeds received from the exercise of these Public Warrants were $ 173.3 million.

The Company redeemed the remaining 365,803 Public Warrants that were not exercised by the holders at a redemption price of $ 0.01 per warrant.

A summary of activity of the Company’s issued and outstanding Public Warrants was as follows:

Public Warrants issued in connection with Merger on July 23, 2021 41,400,000

Number of Public Warrants exercised ( 41,034,197 )

Public Warrants redeemed ( 365,803 )

Issued and outstanding Public Warrants as of December 31, 2021

Treasury Stock

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If-converted common shares from convertible note 36,737,785

If-converted common shares from Series A redeemable convertible preferred stock

If-converted common shares from Series B redeemable convertible preferred stock

Total shares of common stock reserved 731,814,872

NOTE 13 – EARNBACK SHARES AND WARRANTS

During the period between the Closing and the five-year anniversary of the Closing, the Churchill Sponsor has subjected the 17,250,000 Sponsor Earnback Shares of issued and outstanding common stock and 14,783,333 Sponsor Earnback Warrants of issued and outstanding Private Placement Warrants to potential forfeiture to Lucid for no consideration until the occurrence of each tranche’s respective earnback triggering event.

The earnback triggering events related to achieving a volume-weighted average trading sale price greater than or equal to $ 20.00 , $ 25.00 , and $ 30.00 , respectively, for any 40 trading days within any 60 consecutive trading day period were satisfied during the year ended December 31, 2021.

As a result, the 17,250,000 Sponsor Earnback Shares of issued and outstanding common stock and 14,783,333 Sponsor Earnback Warrants of issued and outstanding Private Placement Warrants were vested and no longer subject to the transfer restrictions and contingent forfeiture provisions.

NOTE 10 – STOCK-BASED AWARDS

Legacy Lucid 2021 Stock Incentive Plan

In January 2021, the Company’s Board of Directors adopted and the stockholders approved the 2021 Stock Incentive Plan (the “2021 Plan”).

The 2021 Plan replaced the Company’s 2014 Plan, adopted by the Board of Directors in May 2014 (the “2014 Plan”).

The 10,526,235 shares reserved for future issuance under the 2014 Plan were removed and added to the share reserve under the 2021 Plan.

The 2021 Plan provided for the grant of incentive stock options, non-statutory stock options, restricted shares, RSU, share appreciation rights, performance-based awards and cash-based awards to the Company’s employees, directors, and consultants.

Lucid 2021 Stock Incentive Plan and ESPP

Lucid 2021 Incentive Plan and ESPP

In July 2021, the Company’s Board of Directors adopted and the stockholders approved the 2021 Incentive Plan (the “2021 Incentive Plan”), which includes an ESPP as an addendum.

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The Company’s outstanding stock options generally expire between 7 years to 10 years from the date of grant and are exercisable when the options vest.

Incentive stock options and non-statutory options generally vest over four years , the majority of which vest at a rate of 25 % on the first anniversary of the grant date, with the remainder vesting ratably each month over the next three years .

In general, incentive stock options and non-statutory options vest over four years , the majority of which vest at a rate of 25 % on the first anniversary of the grant date, with the remainder vesting ratably each month over the next three years .

A summary of stock option activity for the year ended December 31, 2024 was as follows:

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Options granted

4,829,886 7.61

Options exercised

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24,696,617 $ 1.37 4.2 $ 48,883

The weighted-average grant-date fair value for options granted for the year ended December 31, 2023 is $ 3.61 .

The weighted-average grant-date fair value for options granted for the year ended December 31, 2024 was $ 1.80 .

Aggregate intrinsic value represents the difference between the exercise price of the options and the fair value of common shares.

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Expected dividends — % — %

As of December 31, 2023, unrecognized stock-based compensation cost related to outstanding unvested stock options that are expected to vest was $ 15.1 million, which i s expected to be recognized over a weighted-average period of 3.2 years.

As of December 31, 2024, unrecognized stock-based compensation cost related to outstanding unvested stock options that are expected to vest was $ 7.1 million and expected to be recognized over a weighted-average period of 2.5 years.

Restricted Stock Units (“RSUs”)

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Time-based RSUs granted prior to the closing of merger are subject to both performance-based and service-based vesting conditions.

The performance condition was satisfied upon the Closing of the Merger, and the service condition will be met generally over 4.0 years.

The Company granted 13,834,748 shares of the time-based RSUs to the CEO that will vest in sixteen equal quarterly installments, beginning on December 5, 2021, and are subject to continuous employment.

The performance condition was satisfied upon the closing of the merger, and the service condition will be met generally over four years .

The Company granted 13,834,748 shares of the time-based RSUs to the former CEO that will vest in sixteen equal quarterly installments, beginning on December 5, 2021, and are subject to continuous employment.

The service condition for 25 % of the Company’s non-CEO RSUs granted prior to the closing of merger was satisfied 375 days after the closing.

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The total fair value of time-based RSUs vested during the years ended December 31, 2024, 2023, and 2022 was $ 140.8 million, $ 121.1 million, and $ 190.9 million, respectively.

In 2021, the Company granted performance-based RSUs to the CEO and they are subject to performance and market conditions.

In 2021, the Company granted performance-based RSUs to the former CEO and they are subject to performance and market conditions.

The performance condition was satisfied upon the closing of the merger.

The market conditions will be satisfied and vest in five tranches based on the achievement of market capitalization goals applicable to each tranche over a six-month period subject to the CEO’s continuous employment through the applicable vesting date.

Any CEO performance-based RSUs that have not vested within five years after the Closing will be forfeited.

The market conditions will be satisfied and vest in five tranches based on the achievement of market capitalization goals applicable to each tranche over a six-month period subject to the former CEO’s continuous employment through the applicable vesting date.

Any performance-based RSUs granted to our former CEO that have not vested within five years after the closing will be forfeited.

The fair value of these performance-based RSUs was measured on the grant date, March 27, 2021, using a Monte Carlo simulation model, with the following assumptions:

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Expected dividends — %

The Company recognizes compensation expense using a graded vesting attribution method over the derived service period for the CEO performance-based awards.

The Company recognizes compensation expense using a graded vesting attribution method over the derived service period for the former CEO’s performance-based awards.

Stock-based compensation expense is recognized when the relevant performance condition is considered probable of achievement for the performance-based award.

During the year ended December 31, 2022, the market condition was met for the CEO performance-based awards for four of the five tranches and certified by the Board of Directors, representing an aggregate of 13,934,271 performance RSUs.

During the year ended December 31, 2022, the market condition was met for the performance-based awards of the former CEO for four of the five tranches and certified by the Board of Directors, representing an aggregate of 13,934,271 performance RSUs.

The Company recorded stock-based compensation expense of $ 85.4 million during the year ended December 31, 2022.

The unamortized expense of $ 8.2 million as of December 31, 2022 for the fifth tranche, representing 2,090,140 RSUs, was fully recognized during the year ended December 31, 2023.

There were no performance-based RSUs vested for the years ended December 31, 2023 and 2021.

The total fair value of performance-based RSUs vested during the year ended December 31, 2022 was $ 315.3 million.

For the years ended December 31, 2023 and 2022, the Company withheld 1.9 million and 9.4 million shares, respectively, of common stock by net settlement to meet the related tax withholding requirements related to the CEO time-based and performance-based RSUs, and nil for the year ended December 31, 2021.

During the year ended December 31, 2023, the Company granted performance-based RSUs to certain employees.

Performance-based RSUs granted to certain employees are subject to (i) annual corporate performance conditions and individual performance and (ii) a service condition which will be met generally over 3 years.

There were no performance-based RSUs vested for our former CEO for the years ended December 31, 2024 and 2023.

The total fair value of the former CEO’s performance-based RSUs vested was $ 315.3 million during the year ended December 31, 2022.

For the years ended December 31, 2024, 2023 and 2022, the Company withheld approximately 1.9 million, 1.9 million, and 9.4 million shares, respectively, of common stock by net settlement to meet the related tax withholding requirements related to the former CEO’s time-based and performance-based RSUs.

The Company granted performance-based RSUs to certain employees and they are subject to (i) corporate performance conditions and/or individual performance and (ii) a service condition which will be met generally over 3 years.

The number of awards granted represents 100 % of the target goal.

Under the terms of the awards, the recipient may earn between 0 % to 150 % of the original number of grants based on actual achievement of corporate performance goals and individual performance.

Under the terms of the awards, the recipient may earn between 0 % to 150 % of the original number of grants based on actual achievement of corporate performance goals and/or individual performance.

Stock-based compensation expense is recognized when the relevant performance condition is considered probable of achievement for the performance-based award.

During the year ended December 31, 2023, the Company recorded stock-based compensation expenses of $ 7.9 million related to these performance-based RSUs.

As of December 31, 2023, the unamortized expense for the performance-based RSUs was $ 13.5 million, which will be recognized over a weighted-average period of 1.3 years contingent upon realization of the corporate performance conditions and individual performance.

During the years ended December 31, 2024, 2023 and 2022, the Company recorded stock-based compensation expenses of $ 26.1 million, $ 7.9 million, and nil , respectively, related to these performance-based RSUs.

The total fair value of these performance-based RSUs vested during the year ended December 31, 2024 was $ 5.3 million, and nil for the years ended December 31, 2023 and 2022.

As of December 31, 2024, the unamortized expense for the performance-based RSUs was $ 30.1 million, which will be recognized over a weighted-average period of 1.1 years primarily contingent upon realization of the corporate performance conditions.

Employee Stock Purchase Plan (“ESPP”)

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If the market value of our common stock on the purchase date is lower than the market value at the beginning of the offering period, the ongoing offering terminates immediately following the purchase of ESPP shares on the purchase date and participants in the terminated offering are automatically enrolled in the new offering resulting in a reset of the offering price and a modification charge to be recognized over the new offering period.

During the years ended December 31, 2023 and 2022, there were two ESPP resets that resulted in modification charges of $ 23.2 million and $ 19.9 million, respectively, which are being recognized until the new offering period ending in November 2025.

During the years ended December 31, 2024, 2023, and 2022, there were two ESPP resets that resulted in modification charges of $ 17.8 million, $ 23.2 million, and $ 19.9 million, respectively, which are being recognized until the new offering period ending in November 2026.

The Company issued 8,976,458 , 4,748,875 , and 2,106,158 shares at a weighted-average price of $ 2.14 , $ 5.02 , and $ 11.66 for the years ended December 31, 2024, 2023, and 2022, respectively.

No shares were issued during the year ended December 31, 2021.

As of December 31, 2024, unrecognized stock-based compensation cost related to the ESPP was $ 31.4 million, which is expected to be recognized over a weighted-average period of 1.9 years.

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Total $ 285,872 $ 257,283 $ 423,500

For the year ended December 31, 2023, stock-based compensation expense capitalized as part of the cost of inventory was $ 43.3 million.

Total stock-based compensation expense for the year ended December 31, 2021 included $ 383.2 million stock-based compensation expense related to the RSUs and $ 123.6 million stock-based compensation expense related to the Series E convertible preferred stock issuance in March 2021 and April 2021.

Refer to Note 8 “Contingent Forward Contracts” and Note 11 “Convertible Preferred Stock” for more information.

The Company capitalized stock-based compensation expenses of $ 45.7 million and $ 43.3 million for the years ended December 31, 2024 and 2023, respectively, primarily as part of the cost of inventory .

NOTE 11 – LEASES

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The Company recorded $ 31.7 million of sales proceeds received as a financial liability within other long-term liabilities in the consolidated balance sheets as of December 31, 2024 and 2023.

The balances for the operating and finance leases where the Company is the lessee are presented as follows within the Company’s consolidated balance sheets (in thousands):

The balances for the operating and finance leases where the Company is the lessee were presented as follows within the Company’s consolidated balance sheets (in thousands):

2024 December 31,

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Year Ended December 31,

2023 2022 2021

Cash paid for amounts included in the measurement of lease liabilities:

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As of December 31, 2024, the Company entered into additional leases for facilities and equipment that have not yet commenced with undiscounted future lease payments of $ 41.1 million.

The leases are expected to commence over the next twelve months.

The leases are expected to commence in 2025 and 2026.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

Contractual Obligations

As of December 31, 2023 and 2022, the Company had $ 270.2 million and $ 593.9 million, respectively, in commitments related to AMP-1 and AMP-2 plant and equipment.

As of December 31, 2024 and 2023, the Company had $ 1,037.1 million and $ 270.2 million in commitments related to AMP-1 and AMP-2 plant and equipment, respectively.

These commitments represent future expected payments on open purchase orders entered into as of December 31, 2024 and 2023.

T he Company’s non-cancellable long-term commitments primarily related to certain inventory component purchases.

The estimated future payments having a remaining term in excess of one year as of December 31, 2023 were as follows (in thousands):

On October 1, 2024, the Company entered into amendments (the “Amendments”) to certain battery-supply agreements with Panasonic Energy Co., Ltd.

and certain of its affiliates.

As of December 31, 2024, pursuant to the terms of the Amendments, the Company had remaining minimum purchase commitments of an aggregate of approximately $ 2.7 billion, calculated using the current base prices, which could vary period-to-period primarily as a result of changes in raw material indexes.

The estimated future payments having a remaining term in excess of one year were as follows (in thousands):

Years ended December 31,

Commitment (1)

2025 $ 220,781

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Total $ 2,739,611

(1) Included minimum purchase commitment of approximately $ 4.9 billion of battery cells from Panasonic Energy Co., Ltd.

and certain of its affiliates.

Legal Matters

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On December 30, 2021, lead plaintiffs in the Consolidated Class Action filed a revised amended consolidated complaint (the “Complaint”), which asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of a putative class of shareholders who purchased stock in CCIV between February 5, 2021 and February 22, 2021.

The Complaint names as defendants Lucid Motors and the Company’s chief executive officer, and generally alleges that, prior to the public announcement of the Merger, defendants purportedly made false or misleading statements regarding the expected start of production for the Lucid Air and related matters.

The Complaint seeks certification of the action as a class action as well as compensatory damages, interest thereon, and attorneys’ fees and expenses.

The Complaint names as defendants Lucid Motors and the Company’s former chief executive officer, and generally alleges that, prior to the public announcement of the Merger, defendants purportedly made false or misleading statements regarding the expected start of production for the Lucid Air and related matters.

The District Court granted defendants’ motion to dismiss on January 11, 2023, with plaintiffs being provided the ability to seek leave to amend.

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On July 28, 2023, plaintiffs appealed the District Court’s decisions to the Ninth Circuit Court of Appeals.

Currently, the parties are litigating the case on appeal.

On December 3, 2021, the Company received a subpoena from the SEC requesting the production of certain documents related to an investigation by the SEC related to the business combination between the Company (f/k/a Churchill Capital Corp IV) and Legacy Lucid and certain projections and statements.

The Company responded and fully cooperated with the SEC in its review.

On April 27, 2023, SEC staff informed the Company that the SEC has concluded this matter and it does not intend to recommend an enforcement action by the SEC against the Company.

On August 8, 2024, the Ninth Circuit affirmed the district court judgment dismissing the case.

On September 17, 2024, the Ninth Circuit denied Plaintiffs’ petition for a rehearing or rehearing en banc .

On September 25, 2024, the Ninth Circuit issued its mandate affirming the district court judgment.

Plaintiffs did not appeal the case to the U.S.

Supreme Court, and the case is therefore now final and closed.

In addition, two separate purported shareholders of the Company filed shareholder derivative actions, purportedly on behalf of the Company, against certain of the Company’s officers and directors in California federal court, captioned Sahr Lebbie v.

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The complaints seek compensatory damages, interest thereon, certain corporate governance reforms, and attorneys’ fees and expenses.

The Company is advancing defendants’ fees and expenses incurred in their defense of the actions.

On April 29, 2022, the District Court consolidated the two actions into In re Lucid Group, Inc.

(f/k/a Churchill Capital Corp IV) Derivative Litigation , Case No.

4:22-cv-00531-YGR (N.D.

Cal.) (the “Consolidated Derivative Action”).

On May 25, 2022, the District Court then stayed the Consolidated Derivative Action pending developments in the Consolidated Class Action.

On December 12, 2023, given that the Consolidated Class Action was dismissed by the trial court and appealed to the Ninth Circuit Court of Appeals, the District Court administratively closed the Consolidated Derivative Action for statistical purposes, but reminded the parties of their obligations under the stay.

On January 9, 2025, the parties filed a joint stipulation of dismissal without prejudice with the District Court, and the case is now closed.

On April 1, 2022 and May 31, 2022, two alleged shareholders filed putative class actions under the federal securities laws against Lucid Group, Inc.

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22-cv-02094-JD.

The consolidated complaint names as defendants Lucid Group, Inc.

and the Company’s chief executive officer and chief financial officer, and generally allege that defendants purportedly made false or misleading statements regarding delivery and revenue projections and related matters between November 15, 2021 and August 3, 2022.

The consolidated complaint seeks certification of the action as a class action, as well as compensatory damages, interest thereon, and attorneys’ fees and expenses.

Defendants filed a Motion to Dismiss on February 23, 2023, which is pending before the court.

Defendants believe that the plaintiffs’ claims are without merit and intends to defend themselves vigorously, but they cannot ensure that their efforts to dismiss the consolidated complaint will be successful or that they will avoid liability in this matter.

The consolidated complaint named as defendants Lucid Group, Inc.

and the Company’s former chief executive officer and former chief financial officer, and generally alleged that defendants purportedly made false or misleading statements regarding delivery and revenue projections and related matters between November 15, 2021 and August 3, 2022.

The consolidated complaint sought certification of the action as a class action, as well as compensatory damages, interest thereon, and attorneys’ fees and expenses.

Defendants filed a Motion to Dismiss on February 23, 2023.

On August 8, 2024, the Court granted in part and denied in part Defendants’ Motion to Dismiss, and gave Plaintiffs leave to replead their complaint.

On September 20, 2024, Plaintiffs filed an Amended Consolidated Complaint, which no longer names the Company’s former chief financial officer as an individual defendant.

Defendants filed a motion to dismiss the Amended Consolidated Complaint, in part, on December 6, 2024.

A hearing on the Motion to Dismiss currently is scheduled for May 1, 2025.

Defendants believe that the plaintiffs’ claims are without merit and intend to defend themselves vigorously, but they cannot ensure that their efforts to dismiss partially the consolidated complaint will be successful or that they will ultimately avoid liability in this matter.

In addition, on July 11, 2022, a purported shareholder of the Company filed a shareholder derivative action, purportedly on behalf of the Company against certain of the Company’s officers and directors in California state court, captioned Floyd Taylor v.

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Securities Litigation action, the Taylor complaint asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets and aiding and abetting breach of fiduciary duty.

The complaint seeks compensatory damages, punitive damages, interest, and attorneys’ fees and expenses.

The Company is advancing defendants’ fees and expenses incurred in their defense of the action.

The complaint seeks compensatory damages, punitive damages, an accounting, interest, and attorneys’ fees and expenses.

The case is currently stayed per stipulation of the parties.

In addition, on September 5, 2024, a purported shareholder of the Company filed a shareholder derivative lawsuit purportedly on behalf of the Company against certain of the Company’s current and former directors in Delaware state court, captioned Tricia Rodney v.

Rawlinson, et al.

, Delaware Court of Chancery, Case No.

The complaint also names the Company as a nominal defendant.

The complaint alleges:

(i) a breach of fiduciary duty claim against the Company’s former CEO;

(ii) a breach of fiduciary duty claim against other then-current members of the Board in 2022;

and (iii) an unjust enrichment claim against the Company’s former CEO.

On November 8, 2024, another purported shareholder of the Company filed a shareholder derivative lawsuit purportedly on behalf of the Company against certain of the Company’s current and former directors in Delaware state court, captioned Ed Lomont v.

Rawlinson, et al.

, Delaware Court of Chancery, Case No.

The complaint also names the Company as a nominal defendant.

The complaint alleges claims similar to the Rodney shareholder derivative action and is premised on the same underlying allegations as those in the In re Lucid Group, Inc.

Securities Litigation action.

On January 28, 2025, the Court consolidated the Rodney and Lomont actions into In re Lucid Group, Inc.

Stockholder Derivative Litigation , Delaware Court of Chancery, Consolidated Case No.

The consolidated action is currently stayed per stipulation of the parties.

On December 3, 2024, another purported shareholder of the Company filed a shareholder derivative lawsuit purportedly on behalf of the Company against certain of the Company’s current and former directors in Delaware state court, captioned May Vang and Mohammed Khalid v.

Rawlinson, et al.

, Delaware Court of Chancery, Case No.

The complaint also names the Company as a nominal defendant.

The complaint asserts claims similar to the Taylor shareholder derivative action and is premised on the same underlying allegations as those in the In re Lucid Group, Inc.

Securities Litigation action.

The case is currently stayed per stipulation of the parties.

On January 29, 2025, another purported shareholder of the Company filed a shareholder derivative lawsuit purportedly on behalf of the Company against certain of the Company’s current and former directors in California federal court, captioned Zalmon Uvaydov v.

Rawlinson, et al.

District Court for the Northern District of California, Case No.:

The complaint asserts claims similar to the Taylor shareholder derivative action, as well as a contribution claim under Section 21(D) of the Securities Exchange Act against the Company’s former CEO, and is premised on the same underlying allegations as those in the In re Lucid Group, Inc.

Securities Litigation action.

On February 7, 2025, another purported shareholder of the Company filed a shareholder derivative lawsuit purportedly on behalf of the Company against certain of the Company’s current and former directors in California federal court, captioned Neil Cook v.

Rawlinson, et al.

District Court for the Northern District of California, Case No.:

3:25-cv-01346.

The complaint asserts claims similar to the Taylor shareholder derivative action, as well as a Section 14(a) claim, and is premised on the same underlying allegations as those in the In re Lucid Group, Inc.

Securities Litigation action.

Moreover, on March 25, 2021, the Illinois Automobile Dealers Association, Chicago Automobile Trade Association, Peoria Metro New Car Dealers Association, Illinois Motorcycle Dealers Association, and 241 individual motor vehicle dealers filed an action against the Office of the Illinois Secretary of State (“SOS”), Jesse White, in his official capacity as the Illinois Secretary of State;

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In December 2022, the Court granted Defendants’ Motion to Dismiss.

Plaintiffs subsequently appealed to the Illinois First District Appellate Court and the parties are currently litigating the case on appeal.

Plaintiffs subsequently appealed and the decision was affirmed by the First District Appellate Court on August 23, 2024.

Plaintiffs filed a petition for further review of the case by the Illinois Supreme Court and the Illinois Supreme Court denied review.

Furthermore, while we have registered and applied for trademarks in an effort to protect our brand and goodwill with customers, competitors or other third parties are, have in the past, and may in the future, oppose our trademark applications or otherwise challenge our use of the trademarks and other brand names in which we have invested.

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In addition, we may lose our trademark or are unable to submit specimens of use by the applicable deadline to perfect such trademark rights.

For instance, we are evaluating and responding to a claim in a United States Patent and Trademark Office administrative hearing opposing and requesting cancellation of our trademark application and registration for the use of “Gravity”.

For instance, in June 2024, we reached an agreement with Gravity, Inc.

to settle a claim before the United States Patent and Trademark Office (“USPTO”) that opposed and requested cancellation of our trademark application and registration for the use of “Gravity.”

At this time, the Company does not consider any such claims, lawsuits or proceedings that are currently pending, individually or in the aggregate, including the matters referenced above, to be material to the Company’s business or likely to result in a material adverse effect on its future operating results, financial condition or cash flows should such proceedings be resolved unfavorably.

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( 13,004 ) ( 1,574 ) 2,164

Loss before provision for income taxes

$ ( 2,712,743 ) $ ( 2,827,394 ) $ ( 1,304,081 )

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Total deferred tax expense

Total provision for income taxes

$ ( 140 ) $ — $ —

Total provision for income taxes $ 1,199 $ 1,026 $ 379

The reconciliation of taxes at the federal statutory rate to our provision for income taxes for the years ended December 31, 2024, 2023 and 2022 were as follows:

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84,604 88,407

461,127 271,784

Other 60,935 21,815

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Tax accounting method change

( 39,939 ) ( 61,072 )

Total deferred tax liabilities ( 182,852 ) ( 185,391 )

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NOTE 14 - NET LOSS PER SHARE

The weighted-average number of shares of common stock outstanding prior to the Merger have been retroactively adjusted by the Exchange Ratio to give effect to the reverse recapitalization treatment of the Merger.

Shares of common stock issued as a result of the conversion of Legacy Lucid convertible preferred stock in connection with the Closing have been included in the basic net loss per share calculation on a prospective basis.

Basic and diluted net loss per share attributable to common stockholders are calculated as follows (in thousands, except share and per share amounts):

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Net loss $ ( 2,713,942 ) $ ( 2,828,420 ) $ ( 1,304,460 )

Deemed dividend related to the issuance of Series E convertible preferred stock — — ( 2,167,332 )

Accretion of redeemable convertible preferred stock (related party)

( 347,610 ) — —

Net loss attributable to common stockholders, basic ( 3,061,552 ) ( 2,828,420 ) ( 1,304,460 )

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If-converted common shares from convertible note 36,737,785 36,737,785 36,737,785

If-converted common shares from Series A redeemable convertible preferred stock 297,567,387 — —

If-converted common shares from Series B redeemable convertible preferred stock 177,103,144 — —

Total 705,063,731 185,235,513 126,145,618

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The 401(k) Plan provides for a discretionary employer-matching contribution.

The Company made no matching contribution to the 401(k) Plan for the years ended December 31, 2023, 2022 and 2021.

The matching contribution expense under the Company’s 401(k) Plan was not material for the year ended December 31, 2024, and nil for the years ended December 31, 2023 and 2022.

NOTE 16 - RELATED PARTY TRANSACTIONS

Public Investment Fund Internship Agreement

In July 2021, the Company entered into an agreement with PIF, which is an affiliate of Ayar, to implement a recruitment and talent development program pursuant to which the Company agreed to evaluate, employ and train participants nominated by PIF during six-month internships, and PIF agreed to reimburse us for expenses related to participant wages, visa fees, medical insurance, airfare and housing incurred by us.

The program ended during the year ended December 31, 2022.

The expenses incurred under the agreement were nil , $ 1.0 million, and nil for the years ended December 31, 2023, 2022 and 2021, respectively.

The amount due from PIF was nil and $ 1.0 million as of December 31, 2023 and 2022, respectively.

In February 2022, the Company entered into a lease agreement with KAEC, a related party of PIF, which is an affiliate of Ayar, for its first international manufacturing plant in Saudi Arabia.

The lease has an initial term of 25 years expiring in Year 2047.

In February 2022, the Company entered into a lease agreement with KAEC, a related party of the PIF, which is an affiliate of Ayar, for its first international manufacturing plant in Saudi Arabia.

The lease has an initial term of 25 years expiring in 2047.

The right-of-use asset related to this lease was $ 4.2 million and $ 4.5 million as of December 31, 2024 and 2023, respectively.

The lease liability was $ 6.1 million and $ 5.7 million as of December 31, 2024 and 2023, respectively.

The right-of-use asset and lease liability were recorded in right-of-use assets and other current liabilities in the consolidated balance sheets, respectively.

The right-of-use asset and lease liability were recorded in right-of-use assets and other long-term liabilities in the consolidated balance sheets, respectively.

The lease expense recorded for the years ended December 31, 2024, 2023, and 2022 was immaterial.

In July 2023, the Company entered into a lease agreement with King Abdullah Financial District Development and Management Company, a subsidiary of PIF, which is an affiliate of Ayar, for its corporate office in Saudi Arabia.

The lease has an initial term of six years expiring in Year 2029.

The right-of-use asset and lease liability related to this lease were $ 2.3 million as of December 31, 2023.

The right-of-use asset and lease liability were recorded in right-of-use assets and other current liabilities in the consolidated balance sheet, respectively.

The lease expense recorded for the year ended December 31, 2023 was immaterial.

In July 2023, the Company entered into a lease agreement with King Abdullah Financial District Development and Management Company, a subsidiary of the PIF, which is an affiliate of Ayar, for its corporate office in Saudi Arabia.

The lease has an initial term of six years expiring in 2029.

The right-of-use asset related to this lease was $ 2.0 million and $ 2.3 million as of December 31, 2024 and 2023, respectively.

The lease liability was $ 2.4 million and $ 2.3 million as of December 31, 2024 and 2023, respectively.

The right-of-use asset and lease liability were recorded in right-of-use assets and other long-term liabilities in the consolidated balance sheets, respectively.

The lease expense recorded for the years ended December 31, 2024 and 2023 was immaterial.

SIDF Loan Agreement

In February 2022, Lucid LLC entered into the SIDF Loan Agreement with the SIDF, a related party of PIF, which is an affiliate of Ayar.

In February 2022, Lucid LLC entered into the SIDF Loan Agreement with the SIDF, a related party of the PIF, which is an affiliate of Ayar.

Under the SIDF Loan Agreement, SIDF has committed to provide the SIDF Loans to Lucid LLC in an aggregate principal amount of up to SAR 5.19 billion (approximately $ 1.4 billion);

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MISA Agreements

In February 2022, Lucid LLC entered into agreements with MISA, a related party of PIF, which is an affiliate of Ayar, pursuant to which MISA has agreed to provide economic support for certain capital expenditures in connection with Lucid LLC’s on-going design and construction of AMP-2.

In February 2022, Lucid LLC entered into agreements with MISA, a related party of the PIF, which is an affiliate of Ayar, pursuant to which MISA has agreed to provide economic support for certain capital expenditures in connection with Lucid LLC’s on-going design and construction of AMP-2.

The support by MISA is subject to Lucid LLC’s completion of certain milestones related to the construction and operation of AMP-2.

Following the commencement of construction, if operations at the plant do not commence within 30 months, or if the agreed scope of operations is not attained within 55 months, MISA may suspend availability of subsequent support.

Pursuant to the agreements, MISA has the right to require Lucid LLC to transfer the ownership of AMP-2 to MISA, at the fair market value thereof, minus an amortized value of the support provided in the event of customary events of default including abandonment or material and chronically low utilization of AMP-2.

Pursuant to the agreements, MISA has the right to require Lucid LLC to transfer the ownership of AMP-2 to MISA, at the fair market value thereof, reduced by an amortized value of the support provided in the event of customary events of default including abandonment or material and chronically low utilization of AMP-2.

Alternatively, Lucid LLC is entitled to avoid the transfer of the ownership of AMP-2 by electing to pay such amortized value.

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During the year ended December 31, 2022, the Company received support of SAR 366 million (approximately $ 97.3 million) in cash, of which $ 64.0 million was recorded as deferred liability within other long-term liabilities and $ 33.3 million was recorded as a deduction in calculating the carrying amount of the related assets in the consolidated balance sheet as of December 31, 2022.

Subsequently, the Company recorded $ 64.0 million as a deduction in calculating the carrying amount of the related assets in the consolidated balance sheet as of December 31, 2023.

During the year ended December 31, 2023, the Company received support of SAR 366 million (approximately $ 97.5 million) in cash, of which $ 62.5 million was recorded as deferred liability within other long-term liabilities and $ 35.0 million was recorded as a deduction in calculating the carrying amount of the related assets in the consolidated balance sheet as of December 31, 2023.

As of December 31, 2024, the Company recorded $ 97.5 million as a deduction in calculating the carrying amount of the related assets in the consolidated balance sheet.

There were no unfulfilled conditions and contingencies attached to the payments received.

In 2023 and 2022, payment receipts were classified as investing cash inflows in the consolidated statements of cash flows.

GIB Facility Agreement

In April 2022, Lucid LLC entered into the GIB Facility Agreement with GIB.

GIB is a related party of PIF, which is an affiliate of Ayar.

GIB is a related party of the PIF, which is an affiliate of Ayar.

The GIB Facility Agreement provided for two committed revolving credit facilities in an aggregate principal amount of SAR 1.0 billion (approximately $ 266.1 million).

On March 12, 2023, Lucid LLC entered into an amendment of the GIB Facility Agreement to combine the Bridge Facility and the Working Capital Facility into a committed SAR 1 billion (approximately $ 266.7 million) GIB Credit Facility which may be used for general corporate purposes.

In March 2023, Lucid LLC entered into an amendment of the 2023 GIB Facility Agreement to combine the Bridge Facility and the Working Capital Facility into a committed SAR 1.0 billion (approximately $ 266.1 million) 2023 GIB Credit Facility which may be used for general corporate purposes.

See Note 6 “Debt” for more information.

Construction Service Contract

Lucid LLC entered into agreements with Al Bawani Company Limited (“Al Bawani”), an affiliate of PIF, which is an affiliate of Ayar, for certain design and construction services in connection with the development of AMP-2.

The capital expenditures incurred under these agreements were SAR 444.6 million (approximately $ 118.6 million) and SAR 109.5 million (approximately $ 29.1 million) as of December 31, 2023 and 2022, respectively.

Amounts due to Al Bawani under these agreements were SAR 74.0 million (approximately $ 19.7 million) and SAR 42.1 million (approximately $ 11.2 million) as of December 31, 2023 and 2022, respectively, and were recorded within other current liabilities in the consolidated balance sheets.

Lucid LLC entered into agreements with Al Bawani Company Limited (“Al Bawani”), an affiliate of the PIF, which is an affiliate of Ayar, for certain design and construction services in connection with the development of AMP-2.

The capital expenditures incurred to date under these agreements were SAR 865.2 million (approximately $ 230.3 million) and SAR 444.6 million (approximately $ 118.6 million) as of December 31, 2024 and 2023, respectively.

Net advance payments made to Al Bawani under these agreements were SAR 129.6 million (approximately $ 34.5 million) as of December 31, 2024, and was recorded within other current assets in the consolidated balance sheet.

Amounts due to Al Bawani was SAR 74.0 million (approximately $ 19.7 million) as of December 31, 2023, and was recorded within other current liabilities in the consolidated balance sheet.

Subscription Agreements

On November 8, 2022, the Company entered into a subscription agreement (the “2022 Subscription Agreement”) with Ayar, pursuant to which Ayar agreed to purchase from the Company, up to $ 915.0 million shares of its common stock in one or more private placements through March 31, 2023.

In November 2022, the Company entered into the 2022 Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company, up to $ 915.0 million shares of its common stock in one or more private placements through March 31, 2023.

In December 2022, the Company issued 85,712,679 shares at a weighted average price per share of $ 10.68 , and received aggregate proceeds of $ 915.0 million.

On May 31, 2023, the Company entered into the 2023 Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company 265,693,703 shares of the Company’s common stock at a price per share of $ 6.83 in a private placement for aggregate net proceeds of $ 1.8 billion.

In May 2023, the Company entered into the 2023 Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company 265,693,703 shares of the Company’s common stock at a price per share of $ 6.83 in a private placement for aggregate net proceeds of $ 1.8 billion.

In June 2023, the Company issued the shares to Ayar pursuant to the 2023 Subscription Agreement and received aggregate net proceeds of $ 1.8 billion after deducting issuance costs of $ 2.0 million.

See Note 9 “Stockholders’ Equity” for more information.

Common stock acquired by Ayar under the 2022 Subscription Agreement and 2023 Subscription Agreement is subject to the Investor Rights Agreement dated February 22, 2021 (as amended from time-to-time, the “Investor Rights Agreement”), which governs the registration for resale of such common stock.

In March 2024, the Company entered into the Series A Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company 100,000 shares of its Series A Redeemable Convertible Preferred Stock for an aggregate purchase price of $ 1.0 billion in a private placement.

Subsequently, in March 2024, the Company issued the shares to Ayar pursuant to the Series A Subscription Agreement and received aggregate net proceeds of $ 997.6 million after deducting issuance cost of $ 2.4 million.

In August 2024, the Company entered into the Series B Subscription Agreement with Ayar, pursuant to which Ayar agreed to purchase from the Company 75,000 shares of its Series B Redeemable Convertible Preferred Stock for an aggregate purchase price of $ 750.0 million in a private placement.

Subsequently, in August 2024, the Company issued the shares to Ayar pursuant to the Series B Subscription Agreement and received aggregate net proceeds of $ 749.4 million after deducting issuance costs of $ 0.6 million.

See Note 8 “Redeemable Convertible Preferred Stock” for more information.

In October 2024, the Company entered into the 2024 Subscription Agreement, pursuant to which Ayar agreed to purchase from the Company 374,717,927 shares of the Company’s common stock in a private placement.

In addition, Ayar agreed to purchase an additional 21,470,459 shares of the Company’s common stock.

As of October 31, 2024, the Company consummated the private placement of shares to Ayar pursuant to the 2024 Subscription Agreement, at a price per share of $ 2.59 , for aggregate net proceeds of $ 1,025.7 million after deducting issuance costs of $ 0.8 million.

See Note 9 “Stockholders’ Equity” for more information.

Common stock acquired by Ayar under the 2022 Subscription Agreement, 2023 Subscription Agreement, 2024 Subscription Agreement, the Redeemable Convertible Preferred Stock acquired by Ayar under the Series A Subscription Agreement and the Series B Subscription Agreement, and the common stock issuable upon conversion thereof are subject to the Investor Rights Agreement dated February 22, 2021 (as amended from time-to-time, the “Investor Rights Agreement”), which governs the registration for resale of such common stock and the Redeemable Convertible Preferred Stock.

Human Resources Development Fund (“HRDF”) Joint Cooperation Agreement

In March 2023, Lucid LLC entered into a joint cooperation agreement with HRDF, a related party of PIF, which is an affiliate of Ayar.

Pursuant to the agreement, Lucid LLC will train and develop local personnel in Saudi Arabia, and HRDF agreed to reimburse the Company training related costs in an aggregate of SAR 29.3 million (approximately $ 7.8 million) during a one-year program.

During the year ended December 31, 2023, the Company received a payment of SAR 8.8 million (approximately $ 2.3 million) in cash.

The Company recorded $ 1.8 million as deferred liability within other current liabilities in the consolidated balance sheet as of December 31, 2023.

The deduction recorded to operating expenses in the consolidated statement of operations and comprehensive loss was immaterial, for the year ended December 31, 2023.

In March 2023, Lucid LLC entered into a joint cooperation agreement with HRDF, a related party of the PIF, which is an affiliate of Ayar.

Pursuant to the agreement, Lucid LLC will train and develop local personnel in Saudi Arabia, and HRDF agreed to reimburse the Company training related costs in an aggregate maximum amount of SAR 29.3 million (approximately $ 7.8 million) during the program.

The Company received a payment SAR 10.9 million (approximately $ 2.9 million) in cash during the year ended December 31, 2024, and SAR 8.8 million (approximately $ 2.3 million) during the year ended December 31, 2023.

The Company recorded $ 1.8 million of deferred liability within other current liabilities in the consolidated balance sheets as of December 31, 2023.

The deduction recorded to operating expenses in the consolidated statement of operations and comprehensive loss was not material for the year ended December 31, 2023.

The deferred liability was nil as of December 31, 2024 and the Company recorded the remaining deferred liability balance as a deduction to operating expenses in the consolidated statement of operations and comprehensive loss.

EV Purchase Agreement

In August 2023, Lucid LLC entered into the EV Purchase Agreement with the Government of Saudi Arabia, a related party of PIF, which is an affiliate of Ayar, as represented by the Ministry of Finance.

In August 2023, Lucid LLC entered into the EV Purchase Agreement with the Government of Saudi Arabia, a related party of the PIF, which is an affiliate of Ayar, as represented by the Ministry of Finance.

The EV Purchase Agreement supersedes the letter of undertaking that Lucid LLC entered into in April 2022.

Pursuant to the terms of the EV Purchase Agreement, the Government of Saudi Arabia and its entities and corporate subsidiaries and other beneficiaries (collectively, the “Purchaser”) may purchase up to 100,000 vehicles, with a minimum purchase quantity of 50,000 vehicles and an option to purchase up to an additional 50,000 vehicles during a ten-year period.

Under the EV Purchase Agreement, the Purchaser may reduce the minimum vehicle purchase quantity by the number of vehicles set out in any purchase order not accepted by us or by the number of vehicles that Lucid LLC fails to deliver within six months from the date of the applicable purchase order.

The Purchaser also has absolute discretion to decide whether to exercise the option to purchase the additional 50,000 vehicles.

The Company recognized net vehicle sales amount of $ 43.7 million during the year ended December 31, 2023.

Accounts receivable balance of $ 35.5 million from the Purchaser was recorded within accounts receivable, net in the consolidated balance sheet as of December 31, 2023.

Under the EV Purchase Agreement, the Purchaser may reduce the minimum vehicle purchase quantity by the number of vehicles set out in any purchase order not accepted by us or by the number of any vehicles that Lucid LLC fails to deliver within six months from the date of the applicable purchase order.

The Purchaser also has sole and absolute discretion to decide whether to exercise the option to purchase the additional 50,000 vehicles.

The Company recognized net vehicle sales amount of SAR 654.6 million (approximately $ 174.2 million) and SAR 163.9 million (approximately $ 43.7 million) during the years ended December 31, 2024 and 2023, respectively.

The deferred revenue from the vehicle sales was primarily related to OTA and was recorded within other current liabilities and other long-term liabilities in the consolidated balance sheets.

As of December 31, 2024 and 2023, the deferred revenue balance was not material.

The Company recorded amounts due from the Purchaser of SAR 217.6 million (approximately $ 57.9 million) and SAR 133.2 million (approximately $ 35.5 million) in accounts receivable, net in the consolidated balance sheets as of December 31, 2024 and 2023, respectively.

See “Vehicle Sales without Residual Value Guarantee” section under Note 2 “Summary of Significant Accounting Policies” for the revenue recognition policies.

Implementation Agreement with Aston Martin

In June 2023, the Company entered into an agreement (the “Implementation Agreement”) with Aston Martin, a related party of PIF, which is an affiliate of Ayar, under which the Company and Aston Martin have established a long-term strategic technology and supply arrangement.

In June 2023, the Company entered into an agreement (the “Implementation Agreement”) with Aston Martin, a related party of the PIF, which is an affiliate of Ayar, under which the Company and Aston Martin have established a long-term strategic technology and supply arrangement.

On November 6, 2023, pursuant to the terms of the Implementation Agreement, integration and supply arrangements became effective, under which the Company will provide Aston Martin access to its powertrain, battery system, and software technologies, work with Aston Martin to integrate its powertrain and battery components with Aston Martin’s battery electric vehicle chassis, and supply powertrain and battery components to Aston Martin (collectively, the “Strategic Technology Arrangement”).

In connection with the commencement of the Strategic Technology Arrangement, the Company received technology access fees in 28,352,273 ordinary shares of Aston Martin (subject to a lock-up provision of 365 days from its issuance) and the first cash installment of $ 33.0 million.

These shares were initially measured at a fair value of $ 73.2 million and subsequently remeasured to fair value of $ 81.5 million as of December 31, 2023.

These shares were initially measured at a fair value of $ 73.2 million.

As of December 31, 2024 and 2023, the Company remeasured the shares and recorded fair values of $ 37.8 million and $ 81.5 million within investments in equity securities of a related party in the consolidated balance sheets, respectively.

The Company will receive the remaining cash payments of $ 99 million phased over a period of three years .

In connection with the Strategic Technology Arrangement, the Company will also receive an aggregate of $ 10 million for integration service fees phased over a period of three years , of which the Company received $ 1.6 million during the year ended December 31, 2023.

In connection with the Strategic Technology Arrangement, the Company will also receive an aggregate of $ 10 million for integration service fees phased over a period of three years , of which the Company received $ 5.8 million from inception through December 31, 2024.

The accounts receivable recorded in the consolidated balance sheet as of December 31, 2024 was immaterial .

The Company accounts for technology access, integration service, and supply arrangement as a single performance obligation and recognizes revenue related to technology access and integration service based on estimated units of delivery under the supply arrangement.

As of December 31, 2023, the Company recorded $ 107.8 million as deferred revenue within other long-term liabilities, in the consolidated balance sheets.

As of December 31, 2024 and 2023, the Company recorded $ 112.7 million and $ 107.8 million as deferred revenue primarily within other long-term liabilities in the consolidated balance sheets, respectively.

Aston Martin has also committed to an effective minimum spend with the Company on powertrain components of $ 225 million.

DDTL Credit Facility

In August 2024, the Company entered into a $ 750.0 million five year DDTL Credit Facility with Ayar, which may be used for working capital and general corporate purposes.

See Note 6 “Debt” for more information.

The Company purchases time deposits with GIB from time-to-time.

GIB is a related party of the PIF, which is an affiliate of Ayar.

As of December 31, 2024, the time deposit balance was $ 35.0 million, which was recorded within short-term investments and long-term investments in the consolidated balance sheet.

See Note 5 “Fair Value Measurements and Financial Instruments” for more information.

NOTE 17 - SEGMENT REPORTING

The Company operates in one reportable segment, as the CODM reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance.

The Company’s CODM is its Chief Executive Officer.

The Company derives segment revenue from the sale of electric vehicles to customers, and the Company’s reported measure of the segment’s profit or loss is the consolidated net loss reported in the consolidated statements of operations and comprehensive loss.

The CODM uses the consolidated net loss for monitoring actual results to assess the Company’s financial performance.

The Company’s CODM does not evaluate its reportable segment using asset information.

The disaggregation of the Company’s revenue by geographic area based on the sales location where the sales originated was as follows (in thousands):

Year Ended December 31,

North America (1)

$ 598,022 $ 521,991

Middle East (2)

194,052 58,993

Other international

15,758 14,287

Total revenue

$ 807,832 $ 595,271

(1) United States revenue was $ 587.3 million, $ 511.3 million, and $ 597.2 million for the years ended December 31, 2024, 2023, and 2022, respectively.

No individual country outside of United States had more than 10% of the total revenue for the year ended December 31, 2022.

(2) Kingdom of Saudi Arabia revenue was $ 191.1 million for the year ended December 31, 2024.

Middle East represented revenue from Kingdom of Saudi Arabia for the year ended December 31, 2023.

The following table included information about reported segment revenue, segment profit or loss, and significant segment expenses (in thousands):

Year Ended December 31,

2024 2023 2022

$ 807,832 $ 595,271 $ 608,181

Cost of revenue - excluding LCNRV and provision for warranty

( 993,154 ) ( 935,118 ) ( 1,043,383 )

Cost of revenue - LCNRV ( 617,446 ) ( 926,898 ) ( 569,479 )

Cost of revenue - provision for warranty

( 120,343 ) ( 74,050 ) ( 33,224 )

Research and development expenses

( 1,176,453 ) ( 937,012 ) ( 821,512 )

Selling, general, and administrative expenses

( 900,952 ) ( 797,235 ) ( 734,574 )

Restructuring charges

( 20,304 ) ( 24,546 ) —

Change in fair value of common stock warrant liability

34,150 86,926 1,254,218

Change in fair value of equity securities

( 43,057 ) 5,999 —

Change in fair value of derivative liabilities associated with redeemable convertible preferred stock (related party)

Interest income

213,026 204,274 56,756

Interest expense

( 32,923 ) ( 24,915 ) ( 30,596 )

Other income (expense), net

( 18,469 ) ( 90 ) 9,532

Provision for income taxes

( 1,199 ) ( 1,026 ) ( 379 )

Segment net loss

( 2,713,942 ) ( 2,828,420 ) ( 1,304,460 )

Consolidated net loss

$ ( 2,713,942 ) $ ( 2,828,420 ) $ ( 1,304,460 )

Depreciation and amortization expenses were $ 295.3 million, $ 233.5 million, and $ 186.6 million for the years ended December 31, 2024, 2023, and 2022, respectively.

The long-lived assets by geographic area were as follows (in thousands):

2024 December 31,

United States

$ 3,314,720 $ 2,950,154

159,778 82,221

Total long-lived assets

$ 3,474,498 $ 3,032,375

NOTE 18 – SUBSEQUENT EVENT

In connection with the preparation of the consolidated financial statements for the year ended December 31, 2024, the Company evaluated subsequent events and concluded there were no subsequent events that required recognition in the consolidated financial statements.

2025 GIB Credit Facility

On February 24, 2025, Lucid LLC entered into the 2025 GIB Credit Facility maturing on February 24, 2028 to increase the credit facility committed amount from SAR 1.0 billion (approximately $ 266.1 million) to SAR 1.9 billion (approximately $ 506.7 million).

The Company is required to pay a quarterly commitment fee of 0.25 % per annum based on the unutilized portion of the 2025 GIB Credit Facility.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data