Lightspeed Commerce (LSPD) Investor update summary

Strategic focus and divestiture rationale

• Announced divestiture of the Upserve U.S. Hospitality product line to Skyview Equity for up to $81 million, with $44 million in cash and up to $37 million in earn-outs over 24 months based on performance milestones.

• Move sharpens focus on core growth engines: North America retail and European hospitality, where unit economics and competitive positioning are strongest.

• Upserve's analytics technology, foundational to Lightspeed Insights, will be retained and further developed as a key driver for the flagship restaurant platform.

• Divestiture aligns with strategy to improve gross margins, strengthen the balance sheet, and accelerate profitable growth.

• After divestiture, about 75% of Fiscal 2026 revenue comes from core growth engines.

Financial impacts and outlook

• Removal of Upserve expected to reduce fiscal 2026 revenue by ~$140 million, gross profit by ~$26 million, and GPV by ~$5 billion.

• Approximately 3,200 U.S. hospitality customer locations and 70 team members will transition as part of the deal.

• Three-year financial goals will be impacted by about 5% on gross profit, adjusted EBITDA, and free cash flow for fiscal 2028, but compound annual growth rate forecasts remain unchanged.

• Fiscal 2027 adjusted EBITDA expected in the range of $75 million-$95 million, a step up from fiscal 2026.

• Fiscal Q4 and full year 2026 revenue and gross profit expected ahead of previous outlook, with adjusted EBITDA in line.

Capital allocation and M&A strategy

• $200 million remains under board authorization for share repurchases, with plans to renew the NCIB program in May 2026.

• Focus remains on growing the high-margin merchant cash advance business, with $106 million outstanding at fiscal Q3 end.

• M&A strategy prioritizes small tuck-in acquisitions to accelerate product development in core growth areas; large-scale acquisitions are not a priority.

• Main uses of cash will be for MCAs and potential share buybacks, depending on market conditions.

• Enhanced flexibility to pursue share repurchases, merchant cash advance expansion, and product investments.