Lightspeed Commerce sees ‘softness’ in North American hospitality

Lightspeed offices are seen in Montreal, Thursday, Jan. 18, 2024. THE CANADIAN PRESS/Christinne Muschi

MONTREAL — Lightspeed Commerce Inc.’s chief financial officer says the technology company has taken a “conservative” approach to forecasting for the year because economic uncertainty is swirling.

With U.S. tariffs plunging much of the globe into a trade war and consumer sentiment waning, Asha Bakshani said same-store sales — revenue generated by businesses that have been open for at least one year — have come under pressure.

The highest level of “softness” has come from the North American hospitality segment of Lightspeed’s business, though the continent’s retail sector as well as Europe’s hospitality industry have also taken a hit, she said.

“That said, however, trends did begin to stabilize in April and in early May,” she told analysts on a Thursday call. “And while it’s too early to call a rebound, we’re really not seeing further deterioration either.”

Bakshani’s remarks came shortly after Lightspeed, which is based in Montreal and sells payment software to businesses, said it’s expecting revenue growth of between 10 to 12 per cent for its 2026 fiscal year.

The guidance was baked into its latest financial release, which showed a fourth-quarter loss of US$575.9 million as its revenue rose 10 per cent compared with a year ago.

The company, which keeps its books in U.S. dollars, said the loss amounted to US$3.79 per diluted share for the quarter ended March 31 compared with a loss of US$32.5 million or 21 cents per diluted share a year earlier.

Its most recent quarter included a non-cash goodwill impairment charge of US$556.4 million.

Goodwill — a measure of a company’s intangible assets like its branding, reputation, customer loyalty, and proprietary technology — must be tested annually, Bakshani said.

The company did its test “given the recent volatility in the valuations of technology companies broadly, and Lightspeed’s share price specifically.”

Analysts have largely attributed the broader tech market’s swings to the unpredictability that comes with evaluating companies whose fortunes easily sway with developments like AI advancements, legislation around semiconductors and tariffs.

When Lightspeed did its test amid the volatility, it found its net assets exceeded its market cap, triggering an impairment charge Bakshani maintained “has no impact on our liquidity.”

“Our balance sheet remains healthy and positions us well for this upcoming year of profitable growth,” she said.

On an adjusted basis, Lightspeed said it earned 10 cents US per share in its latest quarter, up from an adjusted profit of six cents US per share a year earlier.

Revenue for the quarter totalled US$253.4 million, up from US$230.2 million in the same quarter last year.

Transaction-based revenue in the quarter amounted to US$157.8 million, up from US$139.0 million a year ago, while subscription revenue totalled US$87.9 million, up from US$81.3 million in the same quarter last year. Hardware and other revenue was US$7.8 million, down from US$9.9 million.

Moving forward, the company expects to increase its software revenue as customers in its key North American retail and European hospitality segments expand.

That goal will be aided by more than 150 sales representatives Lightspeed is hiring by the end of the year.

This report by The Canadian Press was first published May 22, 2025.

Tara Deschamps, The Canadian Press