Lucid shares climbed for a third straight session on Tuesday after the electric car maker cut its quarterly cash burn by almost a third and secured $1.75 billion of extra funding from Saudi Arabia's Public Investment Fund, even though its third-quarter results missed Wall Street forecasts.

The stock rose 12% through 10am in New York on Tuesday and was trading at $3.89 by 11.23am, up 8.06% on the day, after moving between $3.55 and $4.20. Shares had already risen 9.4% on Monday to close at $3.60, before the results were published after the market closed.

Lucid reported third-quarter revenue of $350 million, up 4% on the same period a year earlier, but below the roughly $396 million analysts had expected. The loss came in at $2.30 a share, slightly wider than the $2.27 consensus forecast. Production fell 24% after the company cut a factory shift, and deliveries also came in below expectations.

Cash burn falls by almost a third

What caught investors' attention was the improvement in cash. Free cash flow consumption fell 30% from the prior quarter to $1.04 billion, and cash ended the quarter above $930 million. Total liquidity, including borrowing room, stood at about $2 billion.

Chief executive Silvio Napoli said the turnaround was beginning to show progress, adding that Lucid was taking decisive action to align manufacturing capacity with demand, reduce inventory and lower operating expenses. The company said it remained on track for its full-year target of a $1.4 billion improvement in cash flow.

Lucid still burned more than $1 billion in cash during the quarter, and nearly $4 billion so far this year, so the improvement does not remove the funding question. At the recent pace, cash on hand alone would last less than one more quarter, although borrowing facilities extend that runway.

Saudi fund lifts lifeline to $3.75 billion

The company also expanded its delayed draw term loan facility with the Public Investment Fund, its largest shareholder, by $1.75 billion. On a pro forma basis, total liquidity rises to $3.75 billion, which Lucid expects to fund operations and key investments into the fourth quarter of 2027, bridging the period until its midsize vehicle begins production in the second half of that year.

Lucid said all project milestones for its robotaxi partnership with Uber and Nuro due by the end of the third quarter had been met, with more than 100 vehicles now on the road. Its mid-term plan and targets are not expected until early 2027.

Wall Street stays cautious

Analysts remain sceptical despite the rally. MarketBeat counts one Buy, nine Hold and three Sell ratings, with an average rating of Reduce and a consensus price target of $8.67. Royal Bank of Canada recently cut its target from $7 to $4, Morgan Stanley cut its target from $5 to $3 with an underweight rating, and Citigroup trimmed its target from $14 to $11 while keeping a Buy.

The shares are down about 79% over the past year and fell 25% in October alone, after disappointing vehicle production and delivery figures. Tuesday's gains leave the stock just above its 50-day moving average of $3.86, but well below its 200-day average of $6.73, a reminder that the turnaround still has a long way to run.