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Lightspeed Commerce's Strategic Review and Third Quarter 2025 Financial Results

On February 6, 2025, Lightspeed Commerce Inc. unveiled the results of its strategic review along with its financial performance for the third quarter of the fiscal year 2025, which concluded on December 31, 2024. The outcomes were promising, demonstrating substantial growth in various sectors and a proactive approach to maximize shareholder value.

Strategic Review Insights

The Board of Directors conducted an extensive evaluation, concluding that implementing a comprehensive transformation plan is the optimal strategy as a publicly traded company. This decisive direction aims to harness market dynamics and customer needs to elevate the company’s competitive edge. Plans are underway to enhance operations in the retail and hospitality sectors within North America and Europe, respectively.

As part of its transformation efforts, Lightspeed is focusing on:
1. Enhanced Market Strategies: By improving its go-to-market strategies and bolstering local marketing efforts, Lightspeed aims to boost its sales efficiency and customer acquisition processes.
2. Technology Investments: Prioritizing technology enhancements to streamline inventory management and customer experience is at the forefront of Lightspeed’s strategic initiatives. These features are crucial for scalability and operational excellence.
3. Efficient Capital Allocation: Initiatives to unlock capital for significant investments in core growth areas are crucial for Lightspeed’s roadmap.
4. Share Repurchase Program: Notably, the company has authorized up to $400 million for a share repurchase program, furthering its commitment to returning value to its shareholders.

Impressive Financial Performance

Lightspeed's financial results for the quarter revealed a total revenue of $280.1 million, reflecting a 17% increase compared to the same period last year. Highlights include:

• - Transaction-Based Revenue: $181.7 million, up 23% YoY.
• - Subscription Revenue: $88.1 million, demonstrating a 9% increase.
• - Adjusted EBITDA: An impressive growth to $16.6 million, showcasing a 350% year-over-year improvement. This surpassed previous projections, indicating solid operational management.

Although a net loss of $26.6 million was reported, it marks an improvement from the prior year’s loss of $40.2 million.

Operational Highlights and Innovations

During the quarter, Lightspeed launched several key innovations, including:

• - Lightspeed Scanner: A feature enhancing retail transactions via mobile payments directly from the store floor.
• - Expanded Payments Features: The introduction of new payment acceptance methods across multiple regions, further enhancing Lightspeed’s capabilities within its Supplier Network across Australia, the UK, Netherlands, and Belgium.
• - New Tools for the Hospitality Sector: Innovations that support operational efficiency in restaurants, including the Kitchen Display System, which bridges front- and back-of-house operations seamlessly.

Additionally, there's a notable increase in average revenue per user (ARPU), reaching approximately $533, up 19% year-over-year, underscoring the effectiveness of Lightspeed's pricing strategies and its evolving service offerings.

Looking Ahead

CEO Dax Dasilva expressed optimism regarding the company's growth trajectory, emphasizing its commitment to cultivating profitable expansion. The company will unveil detailed insights into its transformation plan during the upcoming Capital Markets Day, scheduled for March 26, 2025.

In summary, Lightspeed’s recent strategic initiatives and solid financial performance not only highlight its resilience and agility in a competitive landscape but also affirm the company's position as a critical player in the commerce platform sector. With a focus on innovation and efficiency, Lightspeed is well-positioned for continued growth and success in the coming fiscal quarters.

For more detailed insights, including the recent shareholder letter from CEO Dax Dasilva, please visit Lightspeed's Investor Relations.