Daily Stock Market Reports

Lucid Hits the Brakes, but It’s a Great Day for This Nasdaq Cloud Stock


Recently, the Nasdaq Composite ( ^IXIC -1.59% ) has held up reasonably well in comparison to other stock market benchmarks, marking a nice change after getting hammered throughout much of late 2021. However, even the Nasdaq couldn’t avoid losses on Tuesday morning, with overall weakness in investor sentiment sending it down about half a percent at 10:45 a.m. ET.

One of the culprits weighing on the Nasdaq was Lucid Group ( LCID -13.77% ). The electric-vehicle (EV) company announced quarterly financial results that made some investors more hesitant in assessing its future chances of success. However, it was a much better day for cloud HR services platform-provider Workday ( WDAY 4.92% ), as its shares climbed nicely following its report. Below, we’ll look at both stocks and why they moved in different directions Tuesday.

Person driving Lucid Air.

Image source: Lucid Group.

Lucid gets off to a slow start

Shares of Lucid Group were down more than 14% in Tuesday-morning trading. The electric-vehicle company released its fourth-quarter financial results, but what made many investors nervous was the company’s guidance for 2022.

As you’d expect from a company that’s only beginning to ramp up toward full production, Lucid’s fourth-quarter financials weren’t pretty. Revenue of $26.4 million was up from just $3.6 million a year ago, but massive increases in operating expenses and an accounting charge linked to changes in value of outstanding warrants resulted in a loss of more than $1.04 billion for the period.

None of that was particularly unexpected, and Lucid was pleased that it had produced more than 400 vehicles by the end of February to start meeting more than 25,000 outstanding customer reservations for purchases.

However, what was more troubling was Lucid’s production-outlook update. The EV automaker sees 2022 figures of just 12,000 to 14,000 vehicles, down from calls for 20,000 vehicles three months ago. Lucid is trying to expand its Arizona manufacturing plant and looking to build a new facility in Saudi Arabia, but investors want a faster turnaround to meet demand now.

In the competitive EV market, getting cars on the road as soon as possible is critical. Lucid is winning awards for its Air model but needs to avoid delays and get positive word-of-mouth from actual drivers in gear as quickly as it can.

Workday gets a raise

Elsewhere, shares of Workday were up more than 7%. The HR cloud specialist announced solid results in its fourth-quarter financial report and saw good prospects for the coming year, as well.

Workday’s fourth-quarter numbers showed ongoing growth. Revenue of $1.38 billion was up nearly 22% year over year, with similar-sized gains in subscription revenue and 24-month backlog figures. Adjusted earnings of $0.78 per share were up from $0.73 per share in the previous-year’s period.

Workday attributed its gains to improving conditions in the global labor market, with demand increasing for its finance and human-resources software solutions. More than 60 million users are taking advantage of the Workday platform, with some of the world’s largest organizations making it part of their broader digital-transformation efforts.

Co-CEO Chano Fernandez pointed to a well-stocked pipeline of future business for fiscal 2023. Workday has continued to win business from Fortune 500 companies, while winning cross-sales of new solutions available on its platform.

Labor markets remain tight, and employers need all the tools they can get to manage their workforces effectively, which should keep Workday busy for the foreseeable future. Investors like what they’re seeing from the cloud company.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.





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