Lightspeed(US:LSPD)2023-05-18 14:23Financial Data and Key Metrics Changes - Revenue for Q4 2023 was $184.2 million, representing a 26% year-over-year increase and in line with previous guidance [68] - For fiscal 2023, total revenue reached $730.5 million, a 33% year-over-year increase [66] - Adjusted EBITDA loss improved to $4.3 million from a loss of $19.7 million in the same quarter last year [43] - Annual net retention rate was approximately 110% for fiscal 2023 [38] - Cash and cash equivalents at the end of the quarter were just over $800 million, down from approximately $838 million in the previous quarter [48] Business Line Data and Key Metrics Changes - Subscription revenue increased 8% year-over-year to $76.2 million, with transaction-based revenue growing 49% to $99.6 million [40][41] - Gross payment volumes increased 70% year-over-year to $3.8 billion [41] - Adjusted gross margin for the quarter was 48%, slightly up from the previous quarter [71] - The fastest-growing customer cohort was those with over $1 million in annual GTV, which grew 16% year-over-year [74] Market Data and Key Metrics Changes - GTV for the quarter was $20.2 billion, up 10% year-over-year [45] - Omnichannel GTV was up 3%, while hospitality GTV grew by 20% [45] - The under $200,000 GTV cohort represented only 5% of overall GTV but accounted for 80% of churn [95] Company Strategy and Development Direction - The company aims to become adjusted EBITDA breakeven or better for fiscal 2024, focusing on execution and product innovation [36][53] - The unified payments and POS initiative is expected to enhance customer experience and drive revenue growth [50][100] - The company is focused on high GTV customers and has streamlined its offerings to two flagship products: Lightspeed Retail and Lightspeed Restaurants [25][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profitability and strong growth in the second half of fiscal 2024 following the rollout of unified payments [101][132] - The macroeconomic environment remains challenging, particularly affecting certain retail verticals [80] - Management anticipates some churn among lower GTV customers during the transition to unified payments but expects overall positive financial impacts [99][128] Other Important Information - The company has made significant investments in AI and machine learning to enhance service offerings and reduce costs [35][64] - A four-year contract extension with Saks Fifth Avenue was announced, highlighting strategic partnerships [13] Q&A Session Summary Question: What feedback was received from North American retail customers during the rollout of the unified payment strategy? - Management clarified that they expect lower churn in higher GTV customers and are making the transition as smooth as possible by providing free terminals and contract buyouts [82][84] Question: How does Lightspeed plan to scale its Capital business with the expected increase in payments adoption? - The majority of customers offered Capital are also Lightspeed Payments customers, and self-serve options have been expanded [85] Question: What is the expected pace for moving existing customers to unified POS and payments? - Management believes they can transition the majority of customers by the end of the fiscal year, starting with retail in the US [91] Question: What are the implications for customers who opt out of using Lightspeed Payments? - Management expects that most customers will not opt out, and those who do may face transaction fees, but this group represents a small portion of overall GMV [127][128] Question: Why was the previous organic revenue growth guidance withdrawn? - The withdrawal was primarily due to the focus on unified payments in the first half of the year, with expectations for strong revenue growth in the second half [130][132]