Mr. J.P. Chauvet reports

LIGHTSPEED ANNOUNCES FIRST QUARTER 2024 FINANCIAL RESULTS

Lightspeed Commerce Inc. has released its financial results for the three months ended June 30, 2023.

Lightspeed reports in United States dollars and in accordance with IFRS (international financial reporting standards).

The culmination of One Lightspeed -- bringing its flagship platforms to market -- has allowed the company to hone its focus in this year of execution, including targeting high GTV (gross transaction value) customers, accelerating product innovation and growing revenue from financial services, all while pursuing adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) break-even-or-better for the full fiscal year.

"Although it is still early days for Unified Payments, many customers who have adopted Lightspeed Payments are thrilled with the results, which is encouraging as we continue to roll out this initiative globally," said J.P. Chauvet, chief executive officer of Lightspeed. "Our customers are recognizing that, unlike their experience on legacy systems and outdated terminals, the Lightspeed POS [point of sale] and payments platform saves them time and money, allowing them to elevate the experience they provide to their customers."

"We switched to Lightspeed Payments because with Lightspeed we're saving a lot of money in fees, and it has made the business much faster, cheaper and easier to operate," explained Melissa Joy Manning, owner and CEO of Melissa Joy Manning jewellery. "We're also saving a lot of time in the reconciliation process."

"This quarter saw several promising trends continue, all of which are worth highlighting," said Asha Bakshani, chief financial officer of Lightspeed. "Gross payments volume showed substantial growth, while customer acquisition costs and churn remained in line with previous quarters. Given this strong start to the fiscal year, I believe we are on course to deliver adjusted EBITDA break-even-or-better in fiscal 2024 -- establishing a strong foundation for durable long-term growth."

First quarter financial highlights (all comparisons are relative to the three-month period ended June 30, 2022, unless otherwise stated):

• Total revenue of $209.1-million, an increase of 20 per cent;
• Transaction-based revenue of $121-million, an increase of 32 per cent;
• Subscription revenue of $78.7-million, an increase of 7 per cent;
• Subscription and transaction-based revenue grew 21 per cent year-over-year to $199.7-million;
• Net loss of $48.7-million, representing 23.3 per cent of revenue or a loss of 32 cents per share, as compared with a net loss of $100.8-million, 58 per cent or a loss of 68 cents per share. After adjusting the net loss by $46.5-million for certain items, including share-based compensation, amortization of intangible assets and acquisition-related compensation, the company delivered an adjusted loss of $2.2-million, or a loss of one cent per share versus a loss of $17.6-million, or 12 cents per share, in 2022;
• Adjusted EBITDA loss of $7-million, representing 3.4 per cent of revenue versus its previously established adjusted EBITDA loss outlook of $10-million and adjusted EBITDA loss of $15.6-million, or 9 per cent in 2022;
• As at June 30, 2023, Lightspeed had $780.3-million in cash and cash equivalents.

Operational highlights:

• Lightspeed delivered several new product features in the quarter. In Europe, Lightspeed launched its advanced insights module, an analytics tool that leverages machine learning to provide unique insights for Lightspeed Restaurant customers, while respecting compliance with the General Data Protection Regulation. Lightspeed Capital expanded in new regions, including Australia and Quebec, while self-serve Capital was released for all eligible users in Canada. Within the company's B2B (business-to-business) offering, Lightspeed released NuORDER Assortments for brands in North America and Europe, enabling brands to visualize assortments in the cloud, optimize inventory allocation and identify merchandising gaps. On the unified payments front, next-day payouts are now available to many retail customers using Lightspeed Payments globally.
• Lightspeed's customer base continued to shift toward higher GTV customer locations. This resulted in the number of customer locations with GTV of over $500,000/year increasing by 10 per cent year-over-year, and customer locations with over $1-million/year in GTV increasing by 11 per cent year-over-year. Conversely, the number of customer locations processing under $200,000/year in GTV decreased on a year-over-year basis. Customer locations with GTV of over $500,000/year have substantially lower risk of churn and higher lifetime value for Lightspeed compared with lower GTV/year customers.
• For the quarter, Lightspeed's customers processed GTV of $23.4-billion, up 6 per cent year-over-year. Omnichannel retail and hospitality GTV both grew at approximately the same rates.
• An increasing portion of GTV is being processed through the company's payments solutions. GPV (gross payment volume) increased 56 per cent to $5.1-billion from $3.3-billion in the same period last year.
• The merchant cash advances balance as of June 30, 2023, increased by $11.1-million, or 37 per cent, from the previous quarter.
• The company's global scale and impact was highlighted this quarter as Lightspeed announced it had served over one billion meals and facilitated over 300 million dining experiences in the 12-month period ended May, 2023.
• Notable customer wins include: The Spice & Tea Exchange, a United States-based fine spice and herb store which selected Lightspeed's Retail offering for its over 80 franchises; United Kingdom-based luxury fragrance and skin care provider, Bath House, with six locations, has also signed up for Lightspeed Retail; Chef Teo Paul's restaurants, Cote de Boeuf, Hearts Tavern, Le Tambour Tavern and Michelin-recommended Union, have chosen Lightspeed Restaurant to support their expansion; March First, with four brewery and tasting room locations in Cincinnati, is adopting the Lightspeed Restaurant offering; the six-location Kickon Group from Australia has also joined with Lightspeed Restaurant; and Cove Cay Golf Course in Florida has signed up for the Lightspeed Golf, Retail and Restaurant trifecta.
• After the quarter, Lightspeed published its second annual sustainability report showcasing how customers leverage Lightspeed technology to transform the world for the better and build vibrant, diverse communities. Key highlights include: the planting of 1.4 million trees through Lightspeed's carbon free dining initiative; working with travel partners to offset over two million kilograms of CO2 (carbon dioxide) emissions from business travel; aligning employee wealth creation with the interests of shareholders with approximately 80 per cent of all fiscal 2023 equity incentive grants being to non-insiders; fostering an inclusive workplace where 86 per cent of Lightspeed's employees reported they feel they can be their authentic self at work; and making strides to increase gender diversity throughout the company, including achieving approximately 33-per-cent representation of women at the executive leadership level.

Financial outlook

The following outlook supersedes all prior statements made by the company and is based on current expectations.

The company's outlook reflects caution on the near-term results given the economic climate and its impact on the company's end markets, as well as uncertainty surrounding the impact and timing of the unified payments initiative. The company chose to exercise caution in regard to GTV growth assumptions, as it anticipates that many consumers have yet to experience the full impact of rising interest rates. Additionally, Lightspeed expects that revenue growth and adjusted EBITDA performance will be stronger in the second half of the fiscal year.

Factoring this into consideration, the company's outlook for the full fiscal year and the second quarter is as follows:

• Second quarter 2024:
  • Revenue of approximately $210-million to $215-million.
  • Adjusted EBITDA loss of approximately $4-million.
• Fiscal 2024:
  • Revenue of approximately $875-million to $900-million.
  • Break-even-or-better adjusted EBITDA, inclusive of the costs incurred for the unified payments initiative.

Conference call and webcast information

Lightspeed will host a conference call and webcast to discuss the company's financial results at 8 a.m. ET on Thursday, Aug. 3, 2023. To access the telephonic version of the conference call, visit the Conferencing Portals website. After registering, instructions will be shared on how to join the call, including dial-in information as well as a unique passcode and registrant ID. At the time of the call, registered participants will dial in using the numbers from the confirmation e-mail and, upon entering their unique passcode and ID, will be entered directly into the conference. Alternatively, the webcast will be available live on the investors section of the company's website.

Among other things, Lightspeed will discuss quarterly results, financial outlook and trends in its customer base on the conference call and webcast, and related materials will be made available on the company's website. Investors should carefully review the factors, assumptions and uncertainties included in such related materials.

An audio replay of the call will also be available to investors beginning at approximately 11 a.m. ET on Aug. 3, 2023, until 11:59 p.m. ET on Aug. 10, 2023, by dialling 800-770-2030 for the U.S. or Canada, or 647-362-9199 for international callers, and providing conference ID 74316. In addition, an archived webcast will be available on the investors section of the company's website.

Lightspeed's unaudited condensed interim consolidated financial statements and management's discussion and analysis for the three months ended June 30, 2023, are available on Lightspeed's website, and will be filed on SEDAR+ and on EDGAR.

About Lightspeed Commerce Inc.

Powering the businesses that are the backbone of the global economy, Lightspeed's one-stop commerce platform helps merchants innovate to simplify, scale and provide exceptional customer experiences. The cloud solution transforms and unifies on-line and physical operations, multichannel sales, expansion to new locations, global payments, financing, and connection to supplier networks.

Founded in Montreal, Canada, Lightspeed is dual-listed on the New York Stock Exchange and Toronto Stock Exchange. With teams across North America, Europe and Asia Pacific, the company serves retail, hospitality and golf businesses in over 100 countries.

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