Lightspeed Commerce (TSX:LSPD) just closed out fiscal 2025 with its biggest milestone yet: crossing the billion-dollar revenue mark for the first time. But while the top line impressed, CEO Dax Dasilva told Motley Fool the real focus for Lightspeed now is building a leaner, more profitable business with sharper priorities. So, should investors get in while they can?
Looking back
“Fiscal 2025 was a transformative year,” said Dasilva. “When I came back, we didn’t even have a million dollars in EBITDA (earnings before interest, taxes, depreciation and amortization) from the previous year. We were able to beat expectations throughout the year and really get into that mode of profitable growth.” By year-end, Lightspeed posted US$53.7 million in adjusted EBITDA, up sharply from just US$1.3 million a year earlier. Total revenue climbed 18% year over year to US$1.08 billion.
However, the company also reported a net loss of US$667.2 million. The bulk of that, US$556.4 million, was tied to a non-cash goodwill impairment charge, a figure that spooked some investors. According to Dasilva, this was an accounting trigger and not a reflection of operational health. “It doesn’t affect our ability to execute our strategy,” he explained. “Outside of that impairment, our net loss improved 60% year over year.”
Showing strength
Lightspeed is also seeing growth in software adoption, driven by steady product development. Recent features include a generative artificial intelligence (AI) website builder, retail insights for better inventory forecasting, enhanced kitchen display systems, and upgraded omni gift cards.
On the payments side, the company has made major progress in converting customers to its unified Lightspeed Payments platform. “As of April, we’re at 40%. We’ve gone through the bulk of what we can convert on the back book,” said Dasilva. “Now, every new customer is signing up for our payments system, so the percentage moves up naturally.”
Some of the weakness the company has seen is macro-driven. “There was a lot of talk about tariffs and economic uncertainty earlier in the year,” Dasilva noted. “That did put pressure on consumer confidence, which affected spending volumes in February and March. But we saw stabilization in April.”
What next?
For Lightspeed, though, the real story is about the pivot. In December, the company completed a major operating review and made a strategic decision to refocus on two core markets: North American retail and European hospitality. “Those are the markets where we have the highest right to win,” Dasilva said. “We have the best close rates, the most competitive advantage, and a long history in those regions.”
To support that strategy, Lightspeed invested heavily in outbound sales. Half of the 150 outbound sales reps the company plans to have on the ground by year-end are already hired. “Outbound is not new to us, but it’s been small-scale until now,” Dasilva said. “It’s way more targeted. We’re going after customers that are a better fit, merchants processing more than US$500,000 a year.”
Looking ahead to fiscal 2026, Lightspeed is guiding for revenue growth of 10% to 12%, gross profit growth of 14%, and adjusted EBITDA of US$68 million to US$72 million. Dasilva is optimistic. “Once we start to show location growth alongside the ARPU (annual revenue per unit) growth, people will see that we’re gaining market share,” he said. “We are already doing that in our two key markets. The inflection point is coming.”
Bottom line
In many ways, Lightspeed’s story now mirrors that of other maturing tech firms: a move from fast growth to smart growth. And with its new strategy, the company is betting big that profitability, focus, and execution will win the day. “We’ve been talking about this pivot for a while,” said Dasilva. “Now, we’re delivering it.”
