Lightspeed Commerce Inc.

Thank you for standing by. My name is Bailey and I will be your conference operator today. At this time, I would like to welcome everyone to the Lightspeed first quarter 2024 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 followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star and the number one. I would now like to turn the call over to Gus Papageorgiou. You may begin.

Thank you, operator, and good morning, everyone. Welcome to Lightspeed's fiscal Q1 2024 conference call. Joining me today are JP Chauvet, Lightspeed's chief executive 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 first quarter 2024 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 EDIUR system. And finally note that because we report in U.S. dollars, all amounts discussed today are in U.S. dollars unless otherwise indicated. With that, I will now turn the call over to JP.

Thank you, Gus, and welcome everyone. Thanks for joining us this morning. Overall, I was very happy with our results this quarter. Revenue came in better than expected with revenue growth of 20% versus the approximately 14% contemplated in our outlook. Our GPV volumes increased by 56% year over year, and our adjusted EBITDA loss of $7 million came in lower than our outlook of adjusted EBITDA loss of $10 million. As I mentioned in our last conference call, this year, fiscal 24, Lightspeed is focused on execution and better aligning ourselves to the rule of 40 financial metrics. Our main goals for the year remain the same, namely, reap the benefits of one Lightspeed, accelerate revenue growth for financial services, including both Lightspeed payments and Lightspeed capital, continue building products that solve our customers' problems and help them run their businesses, particularly with our supplier network, and finally, accomplish our goal of becoming adjusted EBITDA breakeven or better for the full fiscal year. In terms of One Lightspeed, we are closer than ever to deploying our flagships in all key markets. At the end of the quarter, we attained fiscalization approval for Belgium, one of the last remaining markets where our flagship hospitality product was not available. And we expect to receive approval in the province of Quebec for a full launch. One Lightspeed has allowed us to simplify our operations and reduce costs and complexity across the organization. But I think more importantly, it's helping us win the right customers, the customers with higher sales volumes and more complex needs. Our data shows that these complex SMBs adopt more software and churn less. Growing our customer base with the right customers remains an important goal for Lightspeed. In this quarter, we saw ARPU reach all-time highs. Our flagship products are allowing us to attract customers who can take full advantage of our software platforms and whose high volumes drive our payments revenue. Let me share a few examples of new customers who joined Lightspeed this past quarter. In retail, we are pleased to welcome Spice and Tea Exchange, with over 80 locations across the U.S., adopting our Lightspeed retail offering. Women's designer clothing, Sole Amore, with two locations in Maine, also adopted our Lightspeed retail solution with e-commerce. And in the U.K., Bath House, a luxury fragrance skin care provider with six locations, has become one of our newest Lightspeed retail customers. In the world of hospitality, we welcomed Australia's Kick On Group, an organization with six locations that operates large venues that range from full table service to classic pubs. We continue to expand our footprint in the important U.S. markets by adding March 1st Brats. March 1st runs four breweries and tasting rooms locations in Cincinnati and have adopted our light speed restaurant offering along with Insights. And we were honored to be chosen by Chef Theo Paul to power his four locations in the greater Toronto area, including Michelin-recommended restaurant Union. In golf, we were chosen by the Cove K Golf Course in Clearwater, Florida, who are now using our retail and hospitality platforms to run their golf academy, restaurant, pro shop, and golf course. I'm thrilled to keep adding more names to our roster of customers around the world. but I also think it's worthwhile reflecting on the sheer scale and impact our platforms have had on growing our customers' businesses. In the 12-month period ended May 2023, Lightspeed's hospitality customers have served over 1 billion meals and facilitated over 300 million dining experiences globally. It's very satisfying to me and the entire Lightspeed team to be a partner of growth and build innovative products and technology that impact both SMBs and their customers around the world. On the topic of scale, I also want to touch on Lightspeed's continued commitment to growing our sustainability impact as a global company. To date, we have planted more than 1.4 million trees through our carbon-free dining initiative, and our industry-leading inventory and ingredient management capabilities are helping reduce waste and streamline our merchant supply chain. In July, we published our second annual sustainability report, which is available on our website and showcases how our customers are leveraging Lightspeed technology to transform the world and build vibrant, diverse communities. Moving back to One Lightspeed. This strategy has allowed us to attract the right kind of customer, but it has also led us to more successful R&D efforts. In this quarter, we were able to deliver several new products and releases that are directly responsive to our customers' needs. In hospitality, we were very excited to launch our Advanced Insights module in Europe. Advanced Insights gives our customers real-time access to their data and offers proactive suggestions for how to run their businesses more efficiently and in a way that helps them comply with their obligations under GDPR. It is one of our best-selling modules in North America one that often commands a higher monthly fee than the POS itself, and we hope to see a similar level of success in Europe. Advanced Insights is a major differentiator for our offering and something that separates us from the competition. In our continued commitment to create a best-in-class unified payments offering, we enabled next-day payouts for many retail customers using Lightspeed Payments globally, giving merchants access to their cash faster than we have ever done before and twice as fast as many legacy systems can provide. We're hearing great feedback from customers who made the switch. Customers like Melissa Joy Manning, an ethically made jewelry store with two locations in New York City.