Lightspeed Commerce Inc.

Good morning. My name is Chris, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Lightspeed second quarter 2023 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. To withdraw your question, please press star one again. Thank you. Gus Papagiorgio, head of investor relations. You may begin.

Thank you, operator, and good morning, everyone. Welcome to Lightspeed's fiscal Q2 2023 conference call. Joining me today are J.P. Chauvet, Lightspeed's chief executive officer, Brandon Nussie, Lightspeed's chief operating officer, and Asha Bhakshani, our chief financial officer. After prepared remarks, we will open it up for your questions. We will make forward-looking statements on our call today that are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Certain material factors and assumptions were applied in respect of conclusions, forecasts, and projections contained in these statements. We undertake no obligation to update these statements except as required by law. You should carefully review these factors, assumptions, risks, and uncertainties in our earnings press release issued earlier today, our second quarter 2023 results presentation available on our website, as well as in our filings with U.S. and Canadian securities regulators. Also, our commentary today will include adjusted financial measures, which are non-IFRS measures and ratios. These should be considered as a supplement to and not a substitute for IFRS financial measures. Reconciliations between the two can be found in our earnings press release, which is available on our website, on CDER.com, and on the SEC's EDGAR system. And finally, note, that because we report in U.S. dollars, all amounts discussed today are in U.S. dollars unless otherwise indicated. Before I turn it over to JP, I would like to remind everyone that we will be hosting our Capital Markets Day on November 15th here at our headquarters in Montreal. For investors that would like to attend, please register by visiting the Investor Relations section of our website. With that, I will now turn the call over to JP.

Thank you, Gus, and welcome, everyone. Thank you for joining us this morning. Lightspeed reported another strong quarter today. We delivered revenue of $184 million ahead of our past outlook of $178 to $183 million. Overall organic software and transaction-based revenue grew by 35%. Our GPV grew 86%, much higher than our GTV growth of 18%. And what's more, our total ARPU grew 25% to 337 per location, excluding equities. On a constant currency basis, revenue was $187.2 million, representing 41% growth year-over-year, and our GTV was $23.8 billion, representing 26% growth. Our efforts at upselling our customers on software and payments helped us deliver strong revenue performance this quarter, and we continue to see success in our target market of complex SMBs, especially among higher GTV customers. Our customer base continues to shift towards larger, more established customers that can use more of our software modules along with payments. These more complex, high GTV customers tend to generate higher ARPU, show lower churn, and are more likely to take advantage of Lightspeed's advanced inventory management capabilities. I believe that the results for the quarter show that our strategy of focusing on the quality over quantity of customers is working. In the quarter, we signed several multi-locations and marquee customers, including Losteria, with 130 restaurants in Germany and expanding across Europe. Losteria offers authentic Italian cuisine to its many customers. They have signed for our flagship product, Lightspeed Restaurant, with payments in all of their German locations and will soon be rolling out to European countries. Spa L'Occitane, a five-star resort and spa in France, will adopt our flagship lightspeed restaurants and payments. The Consulate, a French casual fine dining restaurant in Manhattan's Upper West Side, chose Lightspeed for our robust analytics and reporting capabilities. Anheuser-Busch in Bev selected our headless e-commerce solution for their mobile offering to merchants across their Southern American operations. A California food retailer with 53 locations we'll be using our flagship Lightspeed retail offering along with payments. Although the macro environment impacted our business, it encourages me to see that in the areas that we control, we are performing well. Our new flagship products are being strongly received by customers globally. Payments adoption continues to increase, and our go-to-market teams are showing very good progress at both upselling our existing customers and focusing on adding the right new customers to the Lightspeed family. The macro environment does present its challenges, but it also presents opportunities. Our customers are facing unprecedented conditions. Inflation is putting upwards pressure on price and squeezing profit margins. Staff shortages are making it harder to operate a business and properly serve customers. The threat of a recession is making consumers more cautious about their spending habits, and the omnichannel expectations consumers developed during the COVID pandemic made operating a small business more complicated than ever. Meanwhile, many in the SMBs are still stuck with dated legacy systems incapable of addressing the challenges they face. I believe this presents a unique moment in time for Lightspeed. Given the various challenges pressures on SMB customers, the only way out is to leverage technology. The Lightspeed cloud-based commerce platform can help SMBs to operate with fewer employees by automating time-consuming and mundane tasks, better manage their inventory, understand which menu items drive profitability and repeat business, serve customers through in-store and online channels, and accept and process payments in person or online. But to continue to help our customers, we as a business need to execute effectively. This means meeting our short-term and long-term goals. Between now and the end of our fiscal year, I have three key goals. The first is to finish integrating our acquisitions into one company with one brand and two core product offerings globally, a project we have internally labeled as One Light Speed. The second is to drive payments adoption across as many customers and new and existing as possible. And the last is to position the company to reach profitability. Reaching our goal of one Lightspeed is very important to me and this organization. We are currently selling various platforms in various markets around the world. This adds unnecessary complexity and cost to our organization and hinders our go-to-market momentum. By the end of our fiscal year, we expect to largely be selling only two flagship products globally, Lightspeed Retail and Lightspeed Restaurant, which we believe are the most powerful, modern, and comprehensive offerings in the market today. Being a unified company with two flagship offerings lets us reduce our complexity, improve our go-to-market momentum, and deliver stronger financial performance. Payments will also continue to be a priority. Although I'm encouraged by our progress since launching this offering three years ago, there is still much more to do. Payments is now available in all of our major markets, and we're doing very well at selling it to new customers. Our focus now is to get as many of our existing customers onto payments as possible. We've launched several initiatives to make it happen, and I personally continue to motivate the teams to advance our payments offering to more and more customers. Finally, as an organization, we continue to strive towards profitability. Even with the macroeconomic environment presenting its challenges, we remain focused on profitable growth. By upselling our customers, expanding payments, and adding the right customers to the Lightspeed family, we believe we can improve our unit economics, which is the foundation for reaching profitability. We will continue to invest in our business, but reaching profitability will remain a priority for this company. I'll now turn it over to Brandon and Asha to go into more details, and we'll wrap it up before we go into Q&A.