Lightspeed Commerce Inc. Q3 FY2026 earnings call

• Disciplined execution against the strategy presented at Capital Markets Day, with revenue and adjusted EBITDA exceeding outlook.
• Focus on growth engines (North America retail and European hospitality) driving results, with 2,600 net new locations added in Q3, reaching approximately 148,000 total locations.
• Software revenue grew 6% year-over-year, with growth engines achieving 13% growth. Launched Lightspeed AI and Marketplace, and expanded in-store monetization and hospitality products.
• Achieved second consecutive quarter of positive free cash flow and grew adjusted EBITDA by 22%. Adjusted EBITDA was 15% of gross profit, approaching the long-term target.
• Outbound sales effort expanded, with 150 outbound reps hired, and investment in vertical brand marketing accelerated location growth.

Total revenue for Lightspeed Commerce Inc. in Q3 2026 was $312.3 million. The two growth engines, North America retail and European hospitality, account for two-thirds of total revenue and generated 21% year-over-year revenue growth. Software revenue was $93 million, up 6% year-over-year, with growth engines delivering 13% software growth. Transaction-based revenue was $209.4 million, up 15% year-over-year. Software ARPU rose 4% year-over-year, driven by larger, more sophisticated merchants and new product releases. GTV grew 8% to $25.3 billion, and total average GTV per location increased as higher value customers were signed.

• Fiscal Q4 outlook reaffirms profitable growth trajectory. Raised guidance for Q4: revenue approximately $280 million to $284 million, gross profit approximately $125 million to $127 million, adjusted EBITDA approximately $15 million.
• For fiscal 2026, expected revenue approximately $1.216 billion to $1.220 billion, gross profit approximately $523 million to $525 million, and adjusted EBITDA approximately $72 million. Pulled forward incremental investment in areas like retail outbound sales due to strong demand.

Q: Pulling forward growth investments and impact of Gabe's appointment?

A: Pulling forward investment in retail outbound due to strong pitch with Lightspeed wholesale. Gabe's expertise will accelerate outbound sales and partnership initiatives.

Q: Hardware gross margins and discounting?

A: Hardware gross margins negative due to discounts/incentives for new business, related to encouraging merchants to switch to Lightspeed payments. Expected to vary with new business clip.

Q: Capital business growth and churn?

A: Lightspeed Capital growing prudently with low default rates. Churn in efficiency markets managed well, with software and payments revenue flat to slightly up.