LSPD - Earnings call transcript Q3 2021 | Lightspeed Commerce Inc.

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Operator

Thank you for standing by and welcome to the Lightspeed's Third Quarter 2021 Earnings Call. At this time all participants are in a listen-only mode. After the speakers' presentation there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker today, Gus Papageorgiou. Thank you. ahead. go Please

Gus Papageorgiou

and third operator, everyone. to Welcome Thank XXXX good conference fiscal quarter call. Lightspeed's you, morning

Joining me President today Brandon are questions. will Dax Dasilva, Lightspeed's for up Financial the remarks, your and open After it Nussey, Founder Officer; JP Lightspeed. Chauvet, of prepared we Chief and CEO;

undertake We those results to obligation that uncertainties risks by no based will that on projected. to assumptions, statements, on could required today forward-looking call statements actual differ and from materially and We make cause these as update our are therefore, to subject except law.

risks You financial supplements can filings available read uncertainties the measures, and be measures. found which can two Also, our to not between earnings substitutes measures. about press today our regulators. in be securities these is sedar.com press system. on earlier should release website are financial our considered on non-IFRS as release, and commentary for Canadian Reconciliations SEC's IFRS well These EDGAR which the and issued today earnings adjusted our in include and US with our as in on will

our are amounts I call companies. today by that than all turn finally the note addition, business, identify performance today our dollars key And indicated. different measure discussed because Dax. include used over indicators that trends help be calculated decisions. may In report key indicators us and business, other our affecting performance now dollars, similar manner will that our make plans formulate evaluate key we US business performance strategic unless commentary will indicators to With performance, Such a US in otherwise

Dax Dasilva

our we that morning. of for strategies everyone, to helping Thank stronger-than-expected the another global Thanks offerings quarter them payments, solid eventual you, of to the success the efforts this thank ever footprint and support strong offering, service to to was and are pandemic tenacity a and us employees, such the position and deliver our able Gus, Lightspeed omni-channel improving continue adopt results. and had navigate remarkably for committed product the dedication global our customers recovery. joining as you, as themselves of Lightspeed

and we addition, dedication At challenge, pressure cities in largely not vibrant of solutions people that fact belief of on our small pushing with fundamental limit mission our our of is aimed the and could new to accelerate prouder and be has were I this our pressure, complete have In believe founded also themselves was the the organization, and initiatives. the maintaining to two entrepreneurial is times, believe resilience helping deeply been the acquisitions deliver risen our innovation order due major that noticeable company. we, able to at to them. as customers. Despite employees to as employees to the their strong an businesses on our that I Lightspeed medium-sized a spirit in communities. the

difficult on as know been been, situation that harder has the much that we it our As has current customers.

they and as to hotel, globally where France; in household and three for for we customer existing embrace XXX,XXX supporting a to Group, name plans Kwai Ski legendary restaurant XX ski spa Notable more with hotels and Hong restaurants in cloud-based Kong. their models our Canadian a resort, technology Lan the reinvent platform. retail four with proud choice Asia in Banff, are of shortly; properties included shops customer the will be partner nearly their We with alkalage quarter business Lyon, Fong group locations in be and wins open

growth basis by expanded as Lightspeed XX% and customers XX%, XX%. off and a on GTV investors team's revenue delivered continues in by pay to of Our dedication year-over-year for relocations QX our

base time-consuming last contribution, Payments XX% provides acquisitions their boosted our year quarter. supplier ShopKeep and our managing even multiple only planned times XX% GTV. with organic payments a The places established customers, latest that In offering without keep and making a success of the these stellar product can chain supplier will This and of company. import and can that addition the Payments of join number same almost ahead and portals, four underestimated a also growing official of real-time revenue sites. our inventory they like does guidance suppliers it key existing launch completion and allow growth high offer the the XXX integration and of and customers. and a and view Adoption key of year. the eliminate the in proportion of far create we payments SMBs consumers we last seamless data locations software the GTV initial them for we should need priority on busy are of frustration on to populate excited instantly, grant what and for revenue ahead Although selling so giants quarter independent revenue suppliers as of suppliers sizable the payments opportunity and participants reached a manage very success order from a be images inventory for ordering as the them percent single-digit some network mission demanding the and customer superior quarter, such, This allow plan proportion world know to the can Belgium services, a their The network truly and this accelerating our for minimizing will eventually the Lightspeed this levels to been signed to company. to are data Upserve ecommerce SMB's delivered of offering revenue of look of and network can We manufacturing is the merchants working mid-January, and hopefully discovery a ecommerce network supply the The remains through sell-through We performance initiative. the in launch, have is monetize increase payments, so through ecommerce value products, order the In still enterprise previously the ensuring that out will is it have asking a both year-over-year, how new of with rapidly, want retailers quarter, have year-over-year merchants latest increase see, supply And as strategic not and sites capital had now data. footing their from an experience we this supplier pay customers, our profitability the I XXXX. initiative. same their products themes. of our continued product verticals. into saw for to benefits finally, their rolled to is network, maximize calendar invoices. but powered offering customers Germany, up-to-date highlight us. to among up our quarter I discover post-COVID we France effect, network interact offering simplify to they in limited to our far, But we the requirements. believe are as another BXB us, the can flows benefits key supplier capital. In expect them you runway chain Lightspeed. our the Lightspeed supplier The while such the and about offerings including customer Payments agility, it levels save almost as of had of we sales all our of frustrating terms network. and their Lightspeed clear. this easily and We and what their in inventory that more long of as are should with service only revolutionize is highly have operations. speaks total products many although this for initiative very at better in suppliers motivation that U.K., onto for in our act offers that to Australia, own not where. the into that to In directly of a seen Netherlands, value ecommerce management their ecosystem. Lightspeed capabilities. a in short, had our all geographies, over I'm announced the them Not time compelling and also range It what help entrench to suppliers, we gateway the SMB availability further great simultaneously our long-term other resolution prices of financial our how product and the the

having customers, our for it now, to unlikely access is change, already is free the impact. to is but network supplier that For and an

to as helping as generate already customer suppliers solution are of the is system it choice. new recommending leads example, the For Lightspeed

real consumers we directly to that resolution is cost time the initiative Lightspeed in customers to high offerings large those one-way However, solve our for will this images. them engines. think searches. long their have engine can for issue solutions to for ahead, hope online. have of for also and SMB SMB already our are search customers search lacking high-resolution believe ways that the solved further sourcing, helping are of developing availability are capitalize results for their to We on within images overall and Connecting plans that offering. our of within the paying in we will products minimize field will in to ordering still suppliers. this retailers Supplier the SMBs by the suppliers searching who inventory go differentiate playing popular field challenges connect customers location our spend highly of deliver months customers, for Lightspeed's displaying we also but we is products These issues much innovative delivering time but and display level their a for Part real-time help network inventory level will want help way SMBs. and the the playing And

and our acquisitions actively are recent the teams practices. Upserve, complete, our operations sharing into and are the ShopKeep to on Moving best that acquisitions now of integrating

we before, to strategy, the to advanced clear. hospitality help actively things ShopKeep map we capital business, road capital. and mentioned Upserve, broader M&A With are team analytics want On advanced their into working looking I are with platform. integrate we certain for make the develop to solution Lightspeed maintained As that our an Lightspeed

Lightspeed our approaches similar at Firstly, share they is these and similar run. considerably are into cloud-based, have approach well similar easier. own, Because companies integrating looks a are our to they operations that structure, operations is have and go-to-market companies that

Given are developing integrating acquisitions. experience here, some in have that believe expertise an we I we

solution to Lightspeed have make The integrate goal under integration and end will The Lightspeed with retail our Secondly, the one which at on but solutions. for clear want integrate pace fully by product is all in and brands one several Upserve, way, market brand. of with in and no to one acquisitions operations under is portfolio ShopKeep that we well expected of we be factors, a by for acquisitions interest vary I to maintaining all the summer. and integrated and of April hospitality, for be depending

M&A drive ShopKeep; Upserve and and to our vertical our expand into three to companies solidify continue look expansion such can such verticals to geographic Finally, expansion, approach These is Chronogolf; will market strategy Gastrofix, forward. our technology compelling or technology, takes or footprint, advance going offering. us for as our that goals, as

very of look a remain Australia, In we eventually global place potential the end, recently reopened mirror. recovery. churn they which believe, impacts Opera I But we our limited in as worsening, our degree circumstances, as prospects the immediate in us, additions. at our If lockdowns and challenging we greater in remain discuss signs. I in the a we some and, COVID new such to are House, see as negatively customer put GTV visibility restrictions allows Sydney of our Before markets rearview footprint things want place, term, with where into promising COVID

influences results. had double-digit we has Our quarter behind There overall main these Overall, hospitality are had. the Australia it business saw saw in Australia, but this strong growth. declines ever best quarter, in GTV two

an from is from from to vaccines eventual the only once economy. merchants consumers an second optimistic, businesses and the in back highlighting emerge flock trends these solutions to have necessity. to in cloud-based we not We prospects North similar COVID. allowing reopening commerce and shadow our a solutions. first see we the Europe are bars America of will markets driving recovery, a legacy play and that lockdowns role is The retail. about our to We pandemic But the small restaurants, commerce know continue have impact nice moved are positive resilient to absolute migration cannot is how ongoing being cloud-based to distributed in but believe will but and us, of will from ending long the COVID the impact these

I pass Brouillette CEO Brandon, her Her brings working to our addition strategic solid to as and it I an and Board operational her. also of Finally, highlight before former pass our of to with want will to the and the to experienced of over with experience board, Manon Directors. And Videotron member. is forward addition look strengthens clearly now Brandon. board I it over I Manon

Brandon Nussey

another quarter, environment. very a in terrific reported again, we Today, challenging once Dax. macro Thanks

we the acquisitions, view several where of great of added the investor the moving by to summary presentation result quarter Given many you'll of we have had told, I MD&A, our our All well was certain appendix strength you as our as the of a our our of on as press normalized board. website, charts recent drivers our encourage refer primary across the led business quarter figures. the more release, a four to to see, pieces model. quarter The this as show

saw continued you've of customer metrics under just which, most We adds, base, is now growth have is one another I the First, XXX,XXX at which December for total organic heard, our believe of customer us. locations location strong as important quarter of XX.

more for base, a as we was customers set. our Second, in, quarter saw and broader grow the ARPU highest there. success continued adopt land-and-expand expansion, strategy portion solution ever we kicks and as more our of customer our ARPU the

technology position were revenue, GTV, Third, Lightspeed accelerate many overall The in all-time high this payments. a that subscription payments $XX unlock will an contracting for Lightspeed of customers' And with have tremendous payments for leadership we billion their expense smart acquisitions, synergies. acquisitions opportunity quarter. we number our alongside and lastly, believe and core

and Our significantly ahead highly proven and are believe scale Upserve substantial runway have deals have presence. past market be still ShopKeep acquisitions landmark these of to our four that recent us. our We successful, and all acquisitions of alter drivers of

large, in and churn this market worth face we're macroeconomic core factors to build of led fragmented, our have to Increased working that new muted It's reduced our customer leader. a customers' is challenging customer point measures hard markets Our noting category in and continue many to at higher GTV adds us. our lockdown base.

business date. these stance speak the to financial will But to to of have as drivers growth will offset later, the continue I results. a Fortunately, more near-term we than headwinds take cautious on our

grow, that. For optimism the to today's results longer term, our reinforce continues though, and

XX and quarter Looking million XX% year-over-year were This up previously issued revenues of of at the the million ShopKeep when were recent more million our excluding XX.X and guidance detail, total Upserve. XX acquisitions exceeded in to million. of XX.X

which XX% of Software XX% the revenue represented and was total payments at year-over-year. XX.X in revenue million, quarter up

compared were loss million, last that a of grew Adjusted ago, results reported from and XX% a quarter. quarter an was Excluding that for increase growth software to not company's ago, to acquisitions revenue in year payments all quarter a million ago. XX% year EBITDA year the from loss compared X.X from $X.X the impact the same

As loss business while improvement a continue ago leverage growth. of five see percentage a investing percentage of XX%, XX% the a was even the as from revenue, point for we EBITDA model to year

million quarter ago. loss or from compensation, up million adjusted a community adjusted and of accounting net a loss excludes X.X a adjusted loss largely $X.XX metric loss net This acquisition our loss quarter, in a to year of that net income introducing the are measure non-cash X.X and on which nature. an for impact share the further align we is investor net was per stock-based The share,

the table both the and well release, on XXX our of You'll ended on summary find our calculations presentation cash adjusted net a investor and loss for in EBITDA adjusted of quarter press with over unrestricted capitalized MD&A very hand million. We website.

of expenses press operations of adjusts give of the We presentation at for the cash release, more the This in view have been metric our sellers. would cash shown retained from the that earmarked normalized otherwise recent have and adjusted acquisitions primarily our and closing investor impact business. an transaction-related ongoing MD&A from for a liabilities metric also flow cash to

our For paid downward flow operating this million as the operations insurance a million these on as Adjusted in a recent we of up settlement listing. ago. a was XX approximately figure accounting of the for these to X.X shows cash negative sellers despite This purposes, liabilities negative from transactions. excluding D&O adjustment NYSE of quarter. When back being X.X year from compared amounts flow retained to cash was negative million on includes that, payment flow to the adjusted cash operations $XX million

While continue be with some our the consistency disclosure our price, there that conclusions. expect and of we in will accounting some treatment a components the are hopeful lack acquisitive, normalize this associated of through of to I financials these help coming of accounting incremental of purchase I'm

deeper some saw Looking in specific business we the quarter. the of trends at

to in I As locations mentioned customer XXX,XXX earlier, grew total.

year. last retail prior was and same Excluding to XX% quarter where XX,XXX our view Also were highly and the customers, overall the GTV of encouraging continued year. After by versus XX, this prior as GTV returned our December ecommerce, world. XXX% year markets locations largely payments continue XX% of least, of Canadian XX% I up lockdown Europe have the was but grew with but of GTV not runway XX% three as approximately go, many aided versus with but retail US XX% earlier. months view when Last up and in early from the an weakness GTV this, we US owing great Upserve. ago the continues a around Retail GTV around a restrictions retail much Within launch hospitality the a are than later see lockdowns strength quarter soft versus and was payments and mentioned, our ShopKeep success in showed hospitality GTV XX% excluding calendar still in by outstanding of approaching markets recovery performer GTV government processing this stages. as quarter ShopKeep not Upserve, fell and now where I be still only the business almost us. world, progress. with by year. various we customer to Lightspeed at more to as markets, progress, in and Australia Overall, We organic the XX,XXX impacts our for This achieved retail, overall quarter, in pandemic despite the payments this December. from GTV our ongoing and grew to existing so restaurant to growth our

So turning achieved outlook, confident in QX now business to very QX performance long-term. in leaves us the in our our the

where markets our However, we the are our again now many of in the spring, reflects near-term core lockdowns, as are which government they in were markets. impacting outlook as facing restrictive once the realities end are

that impact the with restrictions. seen January will deal our and increase customers' customer volumes. continue into our these customers these decisions in We've will our government transaction lockdowns purchase softness churn, by We prospects affect will as hospitality expect our segment

along drivers now portion own months hospitality the the revenue world. in by of a of are February, expect And outlook ongoing and business. seasonal ShopKeep be worsened impact lower even larger in payments. our volumes and with the in January These of we the are given slow this also and our years. Upserve, Our success incorporates normal in around Lightspeed lockdowns the to of year retail acquisitions particular,

ago. of we to growth million. QX a mind, all the expect with million range $XX that of XX% revenue So $XX approximately from year in represents This in

leading to dollar million. volumes, on seasonally We to expenses. the of million US expect the $XX impacts loss EBITDA reflects customer overall ongoing the a the and on lockdowns to approximately This weak weakness to stance higher a cautious COVID-XX dollar, Canadian $XX estimate quarter QX which the be is of of compared

for results, the long the continue given the we very term. will view company's while feel uncertainties we about cautious the So take now, position right near-term to many good a of

the business your model. it to turn This quarter's demonstrate operator back that, with again once power And results the for we'll questions. the of

Operator

you. Please question ahead. Richard here Bank Thank first Financial. Tse And [Operator National instructions] from your go from line comes of the

line is Your now open.

Richard Tse

you. Thank Yes.

base So you curious other is as capital, these we kind I'm most for the services. pandemic, you've of for the to side uptake or would say of of instance? what is this the just services of currently lately, look incremental most see added these that on locking what sort demand across

JP Chauvet

one. with Maybe Yeah. I'll start this

for for there's times, I point So stores as has changed. restaurants Overall, hearing went demand really, demand their a solution from their requesting we're a our think customers said and of of we And omni-channel. a ton many nothing ton now for and omni-channel.

thing The payments. a is seeing second we're of lot

our We demand. creating and seeing are software for we're more capital our as launched offering. bundling is and that core more a of capital up, we've This and with is a And now demand lot payments and also. of ramping lot

Richard Tse

And from network pretty going like sounds base off to Or are And development. feedback us early just Okay. across start to with here? to with? going markets that the some try interesting of the specific be base? are much broad you take to targeting it maybe Can pretty current a you supplier the then, share you

JP Chauvet

Yeah.

very in market. bullish the about We is us this think big a So suppliers. for we're differentiator very

suppliers, As really and supply, and ordering of preparation and consumers. to integrate what stores the inside you understand, incredible creates completely flywheel is suppliers of of to enables value process the catalogs really between it do Lightspeed, this the us

and - the As is good we very at metrics to on had And for what's bikes, interesting everybody within we and bikes, that case us. recommending Lightspeed. we first data proved when the test on ecosystem was is be look

service. cost and product real to as customers. and this now launched value of We're impact we've good of lifetime - really going on So it has a acquisition a

levels suppliers now and the where go that to has And verticals And vertical verticals few to be already of to verticals penetration. fully Lightspeed year, makes platform, that the we highest where the have us and a focusing the concentration. on all XXX we but are sense their are supply lot suppliers can going we for have focusing of within a customers now core others, into are means on, we Lightspeed. as the So we'll have be we those and integrate we expanding there's the their the on right that now and catalogs

Richard Tse

perfect. That's

thank you. Okay,

Operator

from next of comes line Your question ahead. the Please with Lenschow Raimo go Barclays.

Your line is now open.

Raimo Lenschow

thank question basically, out there look a about to of like, these from centralize and Can there and think - this created that the side. that? Ariba procurement second me networks big like please, different stay Dax? is, - on cleanup like always Do was had - And that the on you, you second need that, then, supplier mean, all these was supplier you kind there to so of on the the very the Hey, amazing side. about monetize reopening. views just How do and think I Coupa have like how I the you you how if congrats Coupa I numbers. thing? That's more about that And it. whole That on network, Ariba are then, debate some and monetize I kind on to to of that question how guys had

and you Thank run else everyone looking opening any pre-COVID, If any look been through as Australia getting out the has better well? so post-COVID we're that you. far experience at kind as rate this compare up share year with of you learning, and there vaccinations can versus

Dax Dasilva

take and the will second. I'll first question the Raimo, take JP Hi,

is regarding network, - POS supplier discoverability you think advantage right suppliers' for So your I big have system. opening the here within this the

that today, to Lightspeed expand connecting not it's hope We're So portals. separate system, combining than another of into XXX we more suppliers rapidly future. that the directly of a and all set functionality in and BXB

part inventory And ecommerce already they're in it's integral site. they're and already where an managing so of system their the assets managing

think benefit Lightspeed So - that are aggregate a the selling that already to goods they're to Suppliers to time, huge advantage their is because recommending they'll real-time going sell be here. the are of independent data. have choice. system think I - us And I we big the is going that to merchants that independent their eventually, over that

stores. for the for of benefits be there's we there's for us to facilitate is course, benefits system And for regard, there of us the will So BXB the And eventually, that the invoices, other become suppliers, benefit choice. in opportunities etc.

Raimo Lenschow

Yeah.

sense. makes yeah, Okay,

Dax Dasilva

regarding Australia? JP, And

Operator

Your from Truist. Andrew next here line comes Jeffrey ahead. Please the question from go of

Your open. now line is

Andrew Jeffrey

Good a morning. Thank reopening taking you what net thinking I the and growth mentioned wonder have about question. you also your views doubled about And Hi, e-com for guys. is, I question. of quarter. this mix. guess, I'm of sort I

as card Or uptake like some and Australia. good relatively it? consumers seeing perhaps any verticals in back any positive You're net return as protected a is hospitality golf, to way comes we well as there Are trade-offs reopening more present? at look

Brandon Nussey

terms to our growth obviously, Australia, a that but best and decline, we back We that question. many I'll we to in What saw wonderful we're hospitality markets, to it. in segment just take revenue there. Raimo's that additions business mentioned we seeing come of quarter get saw customer back, and led one. look for new way in of our quarter any think Yeah, is I I think it's positive a at net ever

in only beneficial I think board, our a cloud the you we the as And here. platform systems, the of help more reopening position modern well think Lightspeed, given which will volumes majority new legacy advanced ongoing market business is just well, to the spurs this drives across know, with creation business process I as not better rollout as creation in only new of it our think. payments,

and we So forward nothing to the really see positives, look we but year ahead.

Andrew Jeffrey

that there's proposition obviously, that a a assume the to Lightspeed value brings Okay, that's still helpful. providers. legacy as do I stark rip Thank quick and is to reluctant solution? And the are let you. market in follow-up, just some you compared move of willingness changed? cloud a perhaps at the a replace and take Just during leap sort any seeing in changes pandemic. alone any Are attitudes merchants' time, culturally to to have merchants

JP Chauvet

take I'll this one. Yeah,

So good very very world. that's think question, the why we're about a and I I post-pandemic think excited it's

think the I opposite. we're seeing quite

the be delivery don't now And to Lightspeed, it's and system a and of different if platform it's a I'm majority going legacy to through the be going you're you online, has going who to trying if to someone of have restaurant platform, like about a that's manage order ahead. through applications. ton think silos with business, stuck their So basically be

So it's about are something seeing platforms demand operate. have to and become moved maybe who here way actually, actually to looking for is more this, would now they do traditional vendors that And have the at it. never from are view and more established complex that we the they more understand

So on we're Lightspeed there. about systems. of a the demand because for platforms very everything seeing like there it I years their integrate are and customers, are merchants. think market the majority that's harsh make we're next then, legacy underserving much excited our easier and that completely the still reality is ton why platforms the They're And few the of

Andrew Jeffrey

you. Thank

Operator

comes ahead. Your line the next of go Markets. Moschopoulos Thanos question Capital Please from from BMO

is Your now open. line

Thanos Moschopoulos

Hi, good morning.

this to implementing because Or In is Have it of different terms back survivorship seeing, it? say, can kind gone time seeing to of time similar Is just plans bias? in back lockdowns, this there you're any cost characterize qualitatively, containment the current in it or been any not weakness April? around you around? maybe of what maybe have you're more where you hospitality

Brandon Nussey

time does is suffering It in this March. Thanos, me, as dining different it was does Yeah. it hard - as in-person to feel Certainly, around.

of advantage delivery Those business have Ahead the have customers think those play. taken things that our in models like is Order home and have difference I now adapted.

whole of if unknown. do go a to what going around standpoint, to do feel instrumented just there's started, this this this to that, to back March, of our and quarter. differently think visibility know to when have that expect, you to And expect guidance that better a and uncertainty and first I know we in better it from give about the customers. through this more we things help lot Certainly, the gave and virtue we April we by can go what we feel position

Thanos Moschopoulos

being as us the Upserve, on the maybe realize for time owned within Okay. that? few But with of to early frame And then, it's and respect opportunity to thinking your weeks, ShopKeep payments days. that now still Lightspeed you've to far capture and can those start you the I for some assets able maybe bases a customer as update

Brandon Nussey

actively up that for Well And teams was now. of from It list, near are working top under of businesses those rollout to-do the the sure. way. on both

optimistic. settled Those have driving value we're nicely far. all and so significant so into in already Lightspeed, So teams good

JP Chauvet

maybe with also have the And will go-to-market selling to progress advanced to by goal going And one Yeah. the one Brandon, we will just integrated US, the summer, teams with focusing very of of on Upserve's end and by there. is fully and analytics end April, product. fully market the have integrated so product with restaurants our happy the the we in platform add,

Thanos Moschopoulos

the pass Great, I'll guys. thanks, line.

Operator

Daniel from line TD comes ahead. here Please of the go question next Your Chan from Securities.

is now line open. Your

Daniel Chan

Good Thanks. morning. Yeah.

engagement? resources supplier relationship, the on also that Are question your new you the committing this network, devoting a suppliers now product. to Just Anheuser-Busch be to with onboarding these selling they would that some did any announce resources you're

JP Chauvet

Yeah.

contracts in the the have suppliers all of it's place context - excited, that are super same exactly the in we the logic. are So putting

the stores. the there and you are for then benefits benefits So know, as there's suppliers for

And value the see proposition to so is suppliers here for sell-through.

do that the in for very as soon we what you've Lightspeed, we catalogs as small unique which to inventory and in is your are ordering that directly will Lightspeed, versa, stores give So network. the sell-through, promoting Lightspeed will stores basically connected around - your is you actually the of visibility enable all vice And really at and within stores we their see relationship to business. levels whole inventory the supplier. on is have suppliers And

Daniel Chan

some how is this doing? tracking Okay. on new And what help you're venture guide you that to metrics are

JP Chauvet

Yeah.

are on number SKUs, a the transaction we obviously, at, looking that of suppliers and the number we're at We're of onboarding. looking at metrics, So ordering volumes the looking of of number we're inside platform.

Daniel Chan

and one then, you. Okay Brandon, for

Your just off. on some margin you color comes guidance quarter EBITDA for that? suggests give next that Can

Brandon Nussey

coming on Upserve base of fixed a sequential increasing lower contributor, through Yeah. It's you change. just largely down addition take is as transaction now the volumes revenues and well, and especially with company, One, things. cost against that's a an kind ShopKeep seasonally heard our a quarter that a it's And really onboard of one technology with the from just as of you a payments, portion seasonally couple comments, of quarter.

main not of in thing, also that's FX first us a is of helping environment isn't businesses, the scheme grand too, ShopKeep in the It's this moment. mainly role - we thing, very things, playing though it. a not downward are of very seasonal piece in last slight nature is those our at the too comparable big Upserve, due but the quarter, which integration Secondly, a that impact own. expecting and again, to the The to

Daniel Chan

Thank Great. you.

Operator

go comes Josh of Beck the KBCM. Your with next question from Please ahead. line

Your line now open. is

Josh Beck

wanted certainly a Thank about software taking network. ask really I you payments the you're business, have you question. for realm. into more getting Obviously, that also to supplier unique the BXB now and and the BXC

initiative? multiyear supplier Certainly, on coming us curious like you, size when we we When a started you obviously, the update, embark updates a have So since which mean, this indicator. Lightspeed gave time should the that given I what's think and think I'm what on? this quarters color frame of metrics it the journey. you be I milestones And tied public But about us certainly was other should important should thinking is be really and you a focused focused in we kind about? be to of network, and to payments, is on the initiative? really lot an to just years just I but of a what went then,

JP Chauvet

question. great Okay,

think a the So maybe mindset this payments. - it with I'll like steps where But share our and is heading. I try a journey. we it's It's bit and see

supplier there's was harsh it's our businesses pen X inefficient we the listening a it manual, to the customer us, inefficient, easier and directly So for a order is customers to I and paper, through and forth, think it's actually, of is supplier. for The make also small in network. reality and everything need No. this to back for Step lot it's

on the inside there's automation operational vertical adjust here, get network, efficiencies to that them go see advantages. us And other try integrated. and to vertical make by one sell-through for of So can really a model And two that's go and having we really within for we have and a the software step was one possible to our visibility helping lot for the manufacturing stores. suppliers within the is so advantage of the penetrations. We where verticals is fully

can So the of expect with quarters suppliers concentration, more coming efficiency. within in here, more the where onboarding and we'll the what you goal is and expect verticals see be we just where have more platform more and to

- one think one that's track. so I

and at verticals is And actually we've when I basically mind payments is, this, to to for our we within I to - store all Lightspeed right the the in that payments we also for think they have at - And select we payments think go and supplier we're is here using order, side, the once stock Lightspeed had items want the be should for sell pay buy both value track now they've about then, on of that as that they side. and think this piece us, second levels payments payments. ways, but acquisitions sourced on them done, normally Lightspeed we expect they've monetize The all acquire we companies then, order. order, the passed on same the from the once as the consumer, means Lightspeed into monetize us want And verticals ShopKeep and the the this think the with store we last data, there's we the visibility from And inventory using should help to to supplier. once use for inventory I network. commonalities piece us we you a sold large about Lightspeed this we of really really gain looking how the of think stores is And fingerprinting both looking don't can the those together outliers by within be commonalities put know, in not should their at put that And analyzing where that concentration. to suppliers think all actually in of can you data available us and operate. stores last their supplies stores commerce going to all we at as, use and make And to out at imagine you that that look US, to new be figure these identify here, ton supplies. we're - the stores. and the selling are by data the I to all here, suppliers to the Lightspeed, and can selling there, then, I of

last it's journey, once this, all in I exciting think this a about first you think from think consumers, value when you entire value. stores the of I for very of providing flywheel journey. and about step. you're I So to a become of just us, it's a It's very and the And the core But to the piece really acquisition to platform. think think cost suppliers lifetime you're is and sticky

goes have the As soon have ecosystem the promoting lifetime entire goes Lightspeed, and acquisition down you value of as network you up. and cost the

market. but excited it really journey, excited the about we journey. out, And the a product can bring is we very it's to So that and finally are

Josh Beck

sharing maybe they've we opportunity, think we've going and the going curious what which direction. because part look the in slide payments the in I'm for adoption ShopKeep payments, been Certainly believe of very at companies how like and higher the the the dynamics? Brandon, this shows expecting incorporated Or JP, some successful is kind you kick Upserve, be geos once and after if Thanks to should to up? I that will be those on it impact have you incorporation ARPUs those curious these seems thoughts, just follow-up verticals. of we just have super helpful. of helpful on A about for right to

Brandon Nussey

well to product they of ShopKeep, journey percentage business were those Upserve or a available that nice their sure through And Lightspeed they talked on Upserve majority make referral payments the Yeah, the adoption payments particular; payment as to as is infrastructure a tick the we vast build using of a but hard customers we've for good sure, elegant the solution to the as to there. embeds about, customers solution though do a teams into kind largely will a of along the model, their right use really from customers. payments itself. have were in are earlier, as payments further up customer talked working about move that perspective, those

And expect that core vast course, we of positively told, our penetration payments. make is overall to that's the customers majority to at level. impact global do we're here sure worldwide take to all things what a those our to So of really trying around

So these all are things, helpful. I think,

Josh Beck

Great, thanks Brandon.

Operator

comes next from Your question line go Please Timothy Credit of Chiodo the ahead. from Suisse.

now open. is Your line

Timothy Chiodo

ahead the for question. capital. and in path services taking lot a more about embedding beyond bit to thanks a wanted Great, financial little for I payments the dig additional

sample that to offering. be What some cases. So you you be next step could you we've recycled payments sort how about talk And the and the penetration would of past could be little logical that maybe path? And a instant demand little the guys. bit for about monetization of just And also out see of use for maybe payouts the able volume go that a bit work? how that a in talked might how the would

Brandon Nussey

in that's in of in us start all think these stages test in is little hey, interest. we little is good where exactly for to launch with to that this prior enough progress of percentage payments the customer expected Yeah, lot kind processes, are of of still, of we mid customer to We're We're financial and be - it. excited - of to out the to itself, business advantage it's things. there a say accelerates good and the of early these to this. mentioned or first so working suggest doing There's end some workflows is here receptivity we're too an bit a our what we're a of but of And that day, this now at going good the initial other, base are right with offering bit some to couple probably example getting Lightspeed. puts We're think the seeing a position I used these some what be best of uptake early quarters of now stage term, exciting obviously, kind I contributors and sure. and - right for of but good, quarters, that seeing are at that, customer to we're the working to going of stripe we seeing, about and take the each look, I long capital opportunities largely seeing good we're a to with goal the as opportunities, we're in capital. We're to

Timothy Chiodo

can Great, very I you able share a quick early, capital, on thanks a or share. lot. to you any average but are you anything And there follow-up know be just around or since it, it's any mentioned repeat metrics? metrics just loan just sizes rates might

Brandon Nussey

are to back stripe, call, that offer of as that now that little product $XXX,XXX than than now. is, you rates early is COVID up much pressed that loan pause started with Dax did a their well, a onset think, early Average their loans capital ShopKeep lot and measuring know $XXX,XXX. size We're less number, on we of So up expertise. top bit more repeat sort so a sitting obviously, too had infrastructure, be mentioned to as largely and but here to thing. I still leverage days, They advanced the the and of in the we've at now. ramping ShopKeep, right certainly

it, some share in we're I share of we business. the returns a more for and gives us this of some success overall things to to us there. they ahead we really learn there, with some can metrics were say, have terms and years optimism as of think, which to But experience, and couple at we'll So from their it offering of suffice really nice had seeing it start the nice

Timothy Chiodo

a Excellent. the on point it's great ShopKeep capital. Yes,

for a thanks Okay, lot taking questions.

Operator

comes Todd Coupland ahead. next Please Your from from question CIBC. line the go of

now Your open. is line

Todd Coupland

thing is of lot. six talk pressure rates? during payments competition. supplier I'm the any a Could months? half you wondering functionality about I omni-channel of everyone. gained XXXX. network of morning, still kind or to cloud of And see and some the last about just features if landscape players have that risk good Yes, subscription whether rates footing seem pricing, and wanted you A the in it ask second to just number Thanks on of Or decisions? stable that's driving

JP Chauvet

Yeah. all I'll a transparency, take I had In think one. this model. we've better never

competitors. if if pressure. actually at you full ARPU, you wanting if So at more pressure seeing and vendors. integrate solutions delivery networks not buy look multi-location rates, We close you the when true we don't the our about from customers more multiple we're a to the with they from like at - buying physical our look think restaurant to We feel you that to organic, our look retailers We're customers feeling they versus package vendor omni-channel need ours need see on one because and of front, have from support. all wanting

And strong. our I of ever than pressure the So been, think now any is I is that right we stronger and competitors. market not do think many the offering very feel on pricing it's for

Todd Coupland

Okay. Appreciate Thanks much. it. very

Operator

go Your next question comes from the line of Paul from Treiber RBC. Please ahead.

ShopKeep open. Your between revenues Treiber the you in strong And software additional think I growth - growth an XX% is modules there? and due perhaps good so Paul the up organic bridge could and Q that's of payments then just is basis. revenue driving and to it it line - this faster growth morning. the on GTV, Upserve, was I was excluding much, predominantly stronger is also now and Thanks hoping quarter?

Brandon Nussey

Yes.

bit. have of kind little you a that So deconstruct to

well, comments, down, and press Within organically. they're Overall find GTV which ecommerce I GTV some - XX% up the XXX% though, year-over-year. had these of was in So a release hospitality, by that, XX% think wonderful within retail year-over-year. prepared growth up organic the my volumes in were as you'll down quarter, dragged them

happening so retail as most of comes right revenue, see slide, inside now. space payments when what's that's you into And you'll And penetration our that our payments from the revenue convert in kind of GTV. of

with thing as Makes So is quarter kind the more performing of the wrestle have but benefiting side, the doesn't we which of we're at primarily drags it the a until to on be exceptionally lockdowns. And of of retail, additions on revenue sense? sort well. on they through thing this really impact uptake, than a next going hospitality look payments quarter GTV, is down impact Upserve, which huge

Paul Treiber

Yeah. that that's they'll you When in align? Or independent connects the do hospitality, those helpful revenue dots No, versus segments each think retail look other? time of should the two over GTV at and there. fairly between correlation you longer term always of be and

Brandon Nussey

start majority No, launched launched just will it to where is retail Canadian for retail we second GTV our align. the market first. the of payments own - we US that's because in mainly was. We're

we just payments. So are space hospitality newer into with the

of I that course, think we this year. hospitality know, some it year launched all of March long. been things I dealing past kind has of, with don't maybe segment And

we a those uptake see of to to going once I back things So more environment, or payments and normalized align. start hospitality will think, rival exceed, get to we're retail,

Paul Treiber

thanks for Okay, my questions. taking

Gus Papageorgiou

one take last question. Operator, we'll

Operator

you. Thank Great.

next comes from Your JPMC. Please ahead. go from question here Tien-Tsin Huang

is open. now line Your

Tien-Tsin Huang

share additional share size color you strength? question by where the Thanks very of there, strong. you too, Same to type there. can being anything ask so or much, was really say, How location if Any great very, you Are attrition, to surprised? broad-based vertically geographically have I results. wanted growth on or client? or were the location on on positively

Brandon Nussey

in a It's tends of courses kudos last saw that I do overall tougher momentum now. performance we the go behind suppose, really, new even I So a strong and golf retail in revenues triple-digit seeing suppose. is just retail, infrastructure, as to we Europe quarter kind all segment. golf look lockdowns they've wonderful that and And retail upgrade despite as we're a great from right strict the quickly the little a I as well had a experience this team And think the growth firm, Europe we highlight almost been to well the in environment Australia Lightspeed really, emerged this to we're now. as really really has really space seeing more is virus own We're benefiting space. fairly a customer been had and - of that where late golf continue we has now good solution, The in rejuvenated light of performer really to just challenging having mute there. right on - area adds. because world situation, wanted the around the of to and shone and resonating really have just really their globally, kind right that omni-channel in

Tien-Tsin Huang

distance one in golf, social to for I want ask Great more.

consider? quite that. my Just seeing did to efforts That on And example? for first returns on Is bit on on growth, on question could a Brandon. step better sales and anything basis, new a on up And that location share here? is to are baseline sequentially marketing. dollar else this Just a you related you curious

Brandon Nussey

Yeah.

percentage in it's one last year-over-year, the table you momentum on at where model, think are to the more growth I I of we that opportunities. leverage some starting and press more and in positivity stores to all is release of revenue seeing you we're the significantly. adding encourage going than the as the as sort are in marketing not a things, sales the laser-focused percentage ever. of the and EBITDA down marketing worldwide. at the think this, at really a moment look of Sales if look But benefits our revenue encouraging and we we given I just normalize all increased brand We're see of

their some is leverage. but and percentage sales of in acquisitions, in is uptick dollars the mainly addition marketing, to just the really revenue we're nice own of the see overall So taking starting

Tien-Tsin Huang

for taking thanks question. my Understood,

Operator

this there at turn any time. closing back to And further Papageorgiou questions no for over comments. call are I'll the Gus

Gus Papageorgiou

reminder, a speakers be Bicycles for joining there having be on network. well. today. will have will and Dougherty, on with along just a us, us we webinar And Thanks, our joining of from Great. supplier we the to JP February going Giant VP XX Peter Partnerships, are as everybody,

to haven't to our to portion everybody to our register, have day. us, you we if and IR of everybody, for then. and there joining speaking great look the website registered, So to - please forward Thanks, a go

Operator

for your and disconnect. Thank and concludes gentlemen, you today's conference call. ladies And now this participation you may

Lightspeed Commerce (LSPD) 6 Feb 212021 Q3 Earnings call transcript