Montréal-based Lightspeed Commerce posted nearly $305 million USD in revenue and more than $129 million in gross profit during the first quarter of fiscal 2026.
With 15 percent revenue growth and 19 percent gross profit growth year-over-year for the three months ending June 30, the point-of-sale and commerce technology company beat its previously-established outlook for both metrics, according to the firm’s latest earnings report.
Even though Lightspeed exceeded its forecasts, the response from public market investors has been tepid. At time of publication, Lightspeed’s share price closed down over five percent today on the Toronto and New York Stock Exchanges. Analysts who spoke with The Globe and Mail argued that the company needs to grow faster to rekindle interest in its stock.
Dasilva credited Lightspeed’s focus on key markets and a “fluid” but “supportive” macro environment.
In a statement, Lightspeed founder and CEO Dax Dasilva claimed that the company is “winning where it matters” after adding high-quality locations and delivering “solid top-line growth with expanded margins.” Dasilva credited the firm’s product innovation efforts and revised go-to-market strategy for its stronger-than-expected fiscal Q1 results.
In an interview with BetaKit, Dasilva argued that fiscal Q1 demonstrates that Lightspeed can grow and increase profitability simultaneously. He attributed Lightspeed’s earnings beat to its focus on its best-performing markets and a “fluid” but “supportive” macroeconomic environment in fiscal Q1 as consumer spending stabilized after the conservative guidance the company put forth earlier this year. Since then, he said consumer sentiment has also improved.
The CEO described hospitality spending in Europe as a particular “bright spot,” and noted outdoor sporting goods and bicycle sales in North America have also been strong lately following some down years for bike purchases after an early pandemic boom.
Lightspeed added approximately 1,700 new customer locations in fiscal Q1 across its two key growth engines—retail in North America and hospitality in Europe—bringing its total in those markets to 90,000 and 145,000 overall.
As to how Lightspeed has been able to increase both its margins and growth, Dasilva attributed some of this success to the company’s deployment of artificial intelligence, both across its products and for internal operations.
Lightspeed’s adjusted earnings before income, taxes, depreciation, and amortization (EBITDA)—a measure of profitability that the company has been focusing on—was nearly $16 million in fiscal Q1, landing just shy of the top end of its prior estimate. This represented a 55-percent year-over-year increase that Dasilva called “a clear sign that our model is working” during the company’s earnings call.
RELATED: Lightspeed surpasses $1 billion USD in revenue in fiscal 2025 but shares conservative outlook
Dasilva highlighted to BetaKit that Lightspeed is also trending towards becoming adjusted free cash flow breakeven on a quarterly basis. However, Lightspeed posted a net loss of almost $50 million, thanks partly to share-based compensation. The firm closed fiscal Q1 with about $448 million in cash and equivalents.
Lightspeed’s stock currently trades nearly 90 percent below its COVID-19 pandemic high in September 2021 after dropping precipitously amid the broader tech downturn, a fall fuelled partly by an October 2021 short-seller report critical of some of the company’s metrics.
When Dasilva joined The BetaKit Podcast in 2024 shortly after taking the reins back as CEO, he vowed that fiscal 2025 would be the year it became “a profitability story” and exceeded $1 billion in annual revenue. Since then, Lightspeed has hit that mark, conducted a strategic review, made additional layoffs, and refocused on its two strongest markets as it looks to strike the right balance between growth and profitability to win back public market investors.
In February, Lightspeed announced intentions to remain public and execute “a full transformation plan,” including a $400-million share buyback. Dasilva, who indicated that profitable growth remains the firm’s top priority, unpacked the decision in an interview with BetaKit at the time, and shared more details on Lightspeed’s strategy in March. As the CEO told BetaKit earlier this year, demonstrating location growth while also improving the company’s gross profit and adjusted EBITDA on a quarterly basis is a focus for fiscal 2026.
Dasilva noted that Lightspeed still expects to reap more benefits from the aggressive investments it has made in areas like sales and marketing, which he said take time to ramp up.
RELATED: Lightspeed to expand and revamp sales team as part of revised go-to-market effort
During fiscal Q2, Lightspeed forecasts revenue of $305 million to $310 million, gross profit growth of 14 percent, and adjusted EBITDA of $17 million to $19 million. The company’s outlook for fiscal 2026 overall remains unchanged from its last earnings report, when the company shared some conservative projections amid continued global economic uncertainty.
Lightspeed expressed confidence in its ability to continue executing on its strategy, and the company expects to keep adding locations in target markets while retaining revenue in others.
In recent months, Lightspeed and other Canadian tech stocks have both plunged and surged in response to tariff developments in the trade war with the United States (US). Lightspeed could face another challenge on this front going forward, as yesterday, the US announced plans to suspend the de minimis exemption at the end of August.
De minimis permits low-value commercial shipments to be sent to the US without facing tariffs. Should this change come into effect, it would make life more difficult for international sellers, including some of the retail customers Lightspeed serves as well as their clients.
Dasilva said that Lightspeed customers who rely on imported goods have addressed some of their trade and tariff-related issues since the start of this year, including by diversifying their supply chains.
As for the impact of the looming de minimis rollback on Lightspeed, Dasilva claimed that the majority of the firm’s North American retail revenue is done in-store. He said Lightspeed has limited visibility at the moment into how much tariff changes will affect the actual flow of dollars in cross-border commerce. He noted that this is something that the company will be monitoring, but added that, “I don’t have an expectation that it’s going to be super material.”
Feature image courtesy Lightspeed Commerce.