National Bank Says Cost Reduction Not a Surprise2023-01-17 11:05:57 AM ET (MT Newswires)
11:05 AM EST, 01/17/2023 (MT Newswires) -- Separately, National Bank of Commerce noted the cost and job reductions as well as Lightspeed's pre-announced Q3 results that had revenue within its previous guidance range of $185 million to $190 million and adjusted EBITDA ahead of a loss of $9 million.
The bank noted that following a spree of acquisitions since going public in 2019 to the end of 2021, Lightspeed's headcount went from about 700 to 3,000. With the integration of those acquisitions well underway, the cost reductions are not a surprise with investor sentiment shifting towards profitable growth across tech, the bank said. Lightspeed's move to reach profitability sooner is positive, it said.
The bank estimates the headcount reduction should reduce Lightspeed's annual operating expenditure run rate by about $30 million. As such, the company will likely be close to breakeven in Q4 fiscal 2023 with its first profitable fiscal year likely in FY24, the bank noted. It also said that, with $862.6 million of cash on its balance sheet, the company has ample liquidity to cover the restructuring.
National Bank reiterated its Outperform rating on Lightspeed and the target price of US$40.00.