For years, Lightspeed Commerce (TSX:LSPD) was seen as one of Canada’s most promising homegrown tech stories, though its journey has been anything but smooth. Today, with shares sitting around $17 on the TSX, the company trades at a fraction of its pandemic-era highs. But after a year of steady progress, improving fundamentals, and a sharpened focus on retail and hospitality, Lightspeed stock may finally be positioning itself for a comeback.
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A year in review
Over the last year, Lightspeed stock underwent a transformation. Its market cap swung from a high above $3.3 billion back in late 2024 to just over $2.3 billion today, reflecting both investor caution and the tech sector’s volatility. The stock has also faced steep competition and heavy short interest, with roughly three million shares sold short as of July. But beneath the share price, Lightspeed’s business has been quietly strengthening.
Revenue climbed 15% year over year in the most recent quarter, reaching $304.9 million. That figure exceeded management’s outlook, and perhaps more importantly, the company improved gross margins to 42% and boosted gross profit by 19%. For a business that has struggled with profitability in the past, this momentum is significant. Lightspeed stock also turned a corner in operating cash flow, generating $12.4 million compared to a $14 million outflow last year. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at $15.9 million, up from $10.2 million in the prior period.
More to come
What’s driving this improvement is not just growth in its customer base but also higher revenue per user. Average revenue per customer (ARPU) jumped 16% year over year, hitting roughly $655. That growth reflects price increases, wider adoption of Lightspeed stock’s payments solutions, and greater penetration in its target verticals. The company added about 1,700 new retail and hospitality locations during the quarter, ending with approximately 145,000 in total.
Lightspeed also leaned into product innovation, rolling out new features like artificial intelligence (AI)-powered analytics for hospitality, improved mobile payment options, and enhanced inventory tracking. These upgrades help the company expand wallet share with existing customers and improve its competitive positioning against rivals. With more merchants shifting to unified point-of-sale (POS) and payments platforms, Lightspeed’s bet on being a full-stack provider appears to be paying off.
Looking ahead
Still, the path forward isn’t without challenges. Lightspeed stock reported a net loss of nearly $50 million in the quarter, wider than last year’s $35 million loss. Diluted earnings per share (EPS) came in at negative $0.35, reflecting both high share-based compensation and ongoing investments in product development. While the company has nearly $448 million in cash and just $16 million in debt, investors remain wary of recurring losses and the risk of further dilution through stock-based pay. Add in a beta of 2.8, and Lightspeed stock can swing wildly with broader market sentiment.
Looking ahead, management expects second-quarter revenue to land between $305 million and $310 million, with adjusted EBITDA of $17 million to $19 million. For fiscal 2026, the company is targeting revenue growth of 10% to 12% and gross profit growth of about 14%. This suggests confidence in its growth engines. Lightspeed’s strategy is to double down on North American retail and European hospitality while focusing less on lower-return markets. If that focus drives stronger profitability and scale, the stock could attract fresh attention from long-term investors.
Bottom line
For now, Lightspeed stock remains under the radar compared to larger peers, but the building blocks of a turnaround are falling into place. The company has improved efficiency, broadened its product suite, and re-energized its growth in key markets. With margins moving higher and cash burn moderating, the stock could be setting up for a rerating if execution continues.
Lightspeed stock has bounced between a low of $10.50 and a high of $26.60 over the last year, and today’s market cap of just over $2.3 billion doesn’t reflect the scale of its ambition. If the company delivers on its financial outlook and maintains double-digit revenue growth while moving closer to sustained profitability, Lightspeed stock could once again be in the conversation as one of Canada’s next big unicorns hiding in plain sight.
