The move to acquire larger and more profitable merchants comes amid a shift in the tech industry and waning e-commerce consumer demand From alicjawithaj
Jean Paul Chauvet, chief executive of the Montreal-based payment software company, says economic uncertainty and shifting investor sentiment around the technology industry have pushed the company to focus on acquiring larger clients to its customer base.
This year has seen a wave of layoffs in the tech space. Lightspeed has not been immune to the trend, and announced in January that it would be cutting roughly 10 per cent of its staff, or 300 roles.Jean Paul Chauvet, Lightspeed CEO "The way I look at it is we streamlined the organization… We need to double down on our new products.""The challenge selling to small and medium-sized businesses is reaching them in a cost-effective manner and keeping churn, structurally higher in SMB markets, under control," ATB Capital Markets analyst Martin Toner wrote in a note to clients last week.
CIBC Capital Markets analyst Todd Coupland downgraded the company's stock rating as a result, from "outperformer" to "neutral," as well as trimmed its price target for its stock from $34 a share to $27. Coupland wrote in a note to clients macroeconomic headwinds and customer churn in the low end of the market as a result of Lightspeed's focus on the high end "will make it difficult for Lightspeed to reach its own financial targets and outperform peers.
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