What happened

Lucid Group (LCID -0.53%) stock surged on Tuesday and was trading 8% higher as of 1:45 p.m. ET. The luxury electric car maker's latest quarterly numbers are in, and although its revenue growth missed analysts' estimates, Lucid has given investors a lot to chew on.

So what

Here are some key numbers from Lucid's second-quarter earnings release:

  • Revenue up 55% year over year to $150.9 million.
  • Total deliveries of 1,404 vehicles sequentially flat.
  • Loss from operations up 50% year over year to $838 million.
  • Cash and cash equivalents up more than threefold sequentially to $2.8 billion.

It's pretty much the same story: Lucid's deliveries are painfully low, and its losses are mounting. The only saving grace last quarter was its cash balance and liquidity. Rapid cash burn and a liquidity crunch have been among Lucid's biggest concerns.

Last quarter, Lucid raised $3 billion, and it now has a liquidity of $6.25 billion. Management believes that money should last through 2025 and is enough for Lucid to start production of its Gravity SUV by late 2024. The EV maker plans to unveil the SUV in November this year.

Lucid also stuck to its 2023 production goal of 10,000 units and says it is on track to start production of two trims -- the Lucid Air Sapphire and Lucid Air Pure rear-wheel drive -- in mid-September. Among other updates from the quarter, Lucid struck a $450 million partnership with Aston Martin to supply the luxury sports car maker with powertrain, battery, and charging systems. So far, investors have only known Lucid as an electric car maker, not a supplier of components.

Lucid also started shipping EVs to Saudi Arabia last quarter as planned. Lucid has a purchase commitment of 50,000 cars and up to 100,000 cars spread over the next decade from the Saudi Arabian government.

Now what

Lucid's latest updates have rekindled hopes among investors who were losing faith in the company that consistently overpromised and underdelivered. Specifically, investors are willing to bet on Lucid's confidence in producing 10,000 EVs this year, especially after it also shored up its cash balance last quarter.

However, it's too early to turn bullish about Lucid. The company is clearly facing a demand problem, and just days ago, Lucid slashed the prices of its EVs significantly amid rising competition and weak demand for its EVs. Problems are aplenty, and investors may want to wait before jumping on the Lucid bandwagon.