Is Lightspeed Commerce a buy? This analyst weighs in.

Lightspeed Commerce (Lightspeed Commerce Stock Quote, Chart, News, Analysts, Financials TSXV:LSPD) delivered Q4 FY25 results largely in line with expectations, prompting ATB Capital Markets analyst Martin Toner to maintain his “Sector Perform” rating and $17.00 price target in a May 22 note.

Revenue came in at $253.4-million, just above the $252.4-million consensus, while Adjusted EBITDA of $12.9-million matched forecasts. For the full year, revenue grew 18.4%, landing within the company’s guidance range of 18–20%. Management issued slightly better-than-expected guidance for Q1 and FY26, with revenue and gross profit growth forecast to edge above consensus and Adjusted EBITDA projected at $68–$72-million.

“As was highlighted during Lightspeed’s Capital Markets day in March, the company continues to move forward on its ‘full transformation plan’ to focus on growth in North American retail and EMEA hospitality, with the goal of driving profitable growth. Margin improvements and a relatively positive revenue outlook are encouraging,” Toner said.

Lightspeed Commerce, founded in 2005 and based in Montreal, provides point-of-sale and e-commerce software for retail, restaurant, and hospitality businesses. The company operates globally, with offices in New York, Toronto, London, Amsterdam, Berlin and Melbourne.

“Our healthy balance sheet, improving Adjusted EBITDA profitability and free cash flow nearing break-even enabled us to return $219-million of capital to shareholders in the last year,” said CFO Asha Bakshani. “At the same time, we strategically invested in product and go-to-market for retail customers in North America and hospitality customers in Europe, laying the groundwork for continued success.”

Lightspeed’s “full transformation plan” announced last quarter includes improving go-to market efficiency, freeing up capital for investment in growth areas and initiating a $400-million share repurchase program, with $132-million shares already repurchased.

“Moving forward, management will be focused on expanding customer locations throughout their preferred growth markets, which is expected to drive growth in software revenue while increasing payments and capital penetration,” Toner said. “Ultimately, management believes that its shift in growth resources, combined with cost optimization and efficient resource allocation, should drive improved adj. EBITDA and FCF in the years ahead.”

The results reflect a stable performance that met analyst projections, with revenue showing a year-over-year growth of 10.1% and Adjusted EBITDA increasing 177% compared to the previous year. Despite flat gross transaction volume, software and payment revenue strength helped LSPD hit its topline and profitability targets.

“Fiscal 2025 was a transformative year for Lightspeed: we delivered revenue growth of 18% with annual revenue exceeding $1-billion for the first time, we adopted a more focused strategy, concentrating on the markets where we have a proven right to win, and we aligned our organization to execute on that strategy,” said Dax Dasilva, company Founder and CEO. “With a strong financial foundation and our industry-leading commerce platforms, Fiscal 2026 will be dedicated to growing locations, expanding software revenue and enhancing Adjusted EBITDA profitability.”

For Q1 FY26, Lightspeed expects revenue between $285-million and $290-million, in line with the $285-million consensus, with gross profit growing about 13% and Adjusted EBITDA between $14-million and $16-million (consensus: $14.9-million). For the full fiscal year, the company forecasts revenue growth of 10%–12% (consensus: 10%), gross profit growth of 14%, and Adjusted EBITDA between $68-million and $72-million (consensus: $69.9-million).

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