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Q1 FY24: Innovation and scale

We’ve just closed the books on the first quarter of our “Year of Execution,” and I am thrilled to share some news. We’ve seen a solid 20% growth in total revenue, and our Gross Payment Volume (“GPV”) 1  was up by 56% YoY. Plus, our Adjusted EBITDA loss was lower than our previously-established outlook. We’re not just ticking boxes here; we’re making real strides.

I encourage everyone to read the press release for the full story. But first, let me highlight some of the results that show just why Lightspeed is the right commerce platform for entrepreneurs looking to innovate and scale. 

First, we invest in innovation. 

We can increase our investment in innovation because our One Lightspeed goal has helped us hone our focus. 

With our flagship products—Lightspeed Retail and Lightspeed Restaurant, both of which include Lightspeed Payments—we can simplify our operations. We can reduce complexities across the organization.

And we can focus on making better products that help our merchants scale their businesses. In our first fiscal quarter of the year, our product team has been rolling out new features that are making a difference. We’ve introduced: 

  • Advanced Insights in Europe.  This lets customers access real-time data. It suggests how to run their business more efficiently while respecting compliance with GDPR obligations.
  • Expanded Lightspeed Capital to new regions, including Australia, plus a self-serve option now available to eligible users in Canada.
  • Multi-layer pricing in Lightspeed Retail. It allows merchants to charge different prices per location/customer group. 
  • NuORDER Assortments for Brands in North America and Europe. Now, brands can optimize inventory and identify merchandising gaps.

We’re not just solving problems; we’re anticipating them.

Second, we unlock added benefits for our customers’ business. Case in point, unifying our POS and Payments offerings into one platform

We’re asking all eligible customers to sign up for one cohesive and comprehensive product offering, where Lightspeed Payments is embedded directly into their POS.

We launched this initiative—known as Unified Payments—across NOAM this spring, and it’s going worldwide this year

It’s early, but we’re seeing encouraging results:

  • Excluding the Ecwid eCommerce standalone product, ARPU 2 is reaching all-time highs (up 20% YoY)
  • Our close rates have remained relatively consistent 
  • Our churn rate remains within historical ranges 

We’re also hearing from customers  who already adopted our unified platform, like Brooklyn jeweler Melissa Joy Manning, She points out that “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.”

This is not a one-and-done launch. We’re actively listening to feedback and continuing to improve as we go. For example, eligible customers switching to Lightspeed Payments will experience:

  • Competitive, ‘meet or beat’ rates
  • Free payments hardware and installation + 24/7 support
  • Next-day payouts for most retail customers globally
  • And more feature enhancements, coming soon!

Third, we’re built to simplify the complex—a tool best leveraged by high GTV customers

We saw a 10% YoY increase this quarter in high GTV Customer Locations 3(those with over $500K/year in GTV4). As high GTV customers scale, they expand their tech suite and invest more in our platforms to keep building on that momentum. This is reflected in the aforementioned increase of ARPU (up by 20% YoY). 

This tells me we’re on the right track in our efforts to welcome more established, sophisticated retailers and restaurateurs to the Lightspeed family. Customers like the ones who just joined Lightspeed this quarter:

  • The Spice & Tea Exchange, a US-based fine spice and herb store which selected Lightspeed’s Retail offering for their over 80 franchises; 
  • UK-based luxury fragrance and skin care provider, Bath House, with 6 locations has also signed up for Lightspeed Retail; 
  • Chef Teo Paul’s restaurants, Côte de Boeuf, Hearts Tavern, Le Tambour Tavern and Michelin recommended Union, have chosen Lightspeed Restaurant to support their expansion; 
  • March First, with 4 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. 

And finally, we’re built to help businesses scale.

Traditional POS systems manage a lot of scale, but they don’t innovate. They’re hard to update and super expensive. 

Lightspeed manages scale and drives innovation.  Our ability to service businesses at scale, with higher complexity, sets us apart. 

Here’s a perfect example:  in the last twelve months, restaurateurs have leveraged Lightspeed Restaurant to serve over 1 billion meals worldwide and facilitated over 300 million dining experiences. 

This highlights how Lightspeed Restaurant’s transaction volume has grown. And that’s just one of the ways we’re helping businesses speed up growth, provide the best customer experience and become a go-to destination in their space. 

There’s a reason why the world’s best restaurants and retailers run their business on Lightspeed. Keep watching this space to watch them grow.

1Key performance indicator. Gross Payment Volume. “Gross Payment Volume” or “GPV” means the total dollar value of transactions processed, excluding amounts processed through the NuORDER solution, in the period through our payments solutions in respect of which we act as the principal in the arrangement with the customer, net of refunds, inclusive of shipping and handling, duty and value-added taxes. We use this measure as we believe that growth in our GPV demonstrates the extent to which we have scaled our payments solutions. We have excluded amounts processed through the NuORDER solution from our GPV because they represent business-to-business volume rather than business-to-consumer volume, and we do not currently have a robust payments solution for business-to-business volume. 
2Key performance indicator. Average Revenue Per User. “Average Revenue Per User” or “ARPU” represents the total subscription revenue and transaction-based revenue of the Company in the period divided by the number of Customer Locations of the Company in the period. We use this measure as we believe it provides a helpful supplemental indicator of our progress in growing the revenue that we derive from our customer base. For greater clarity, the number of Customer Locations of the Company in the period is calculated by taking the average number of Customer Locations throughout the period.
3Key performance indicator. Customer Locations. “Customer Location” means a billing merchant location for which the term of services have not ended, or with which we are negotiating a renewal contract, and, in the case of NuORDER, a brand with a direct or indirect paid subscription for which the terms of services have not ended or in respect of which we are negotiating a subscription renewal. A single unique customer can have multiple Customer Locations including physical and eCommerce sites and in the case of NuORDER, multiple subscriptions. We use this measure as we believe that our ability to increase the number of Customer Locations with a high GTV per year served by our platform is an indicator of our success in terms of market penetration and growth of our business. A Customer Location’s GTV per year is calculated by annualizing the GTV for the months in which the Customer Location was actively processing in the last twelve months.
4Excluding Customer Locations and GTV attributable to Ecwid eCommerce standalone product, Lightspeed Golf and NuORDER by Lightspeed product. A Customer Location’s GTV per year is calculated by annualizing the GTV for the months in which the Customer Location is actively processing in the last 12 months.
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