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Lightspeed (NYSE:LSPD) stock dipped 2.2% in Friday morning trading as Credit Suisse analyst Timothy Chiodo downgraded the shares to Neutral from Outperform, citing management’s prospects for macroeconomic pressures poised to weigh on its customers.
The company, which offers a commerce enabling Software as a Service (SaaS) platform for small and midsize businesses, expects revenue for 2023 to land on the lower end of its previous target range of $730M-$740M, given consumer spending pressure impacting payments revenues. That compares with the $730.4M average analyst estimate.
“Given the macro uncertainty, our focus has turned to running the business with a greater focus on profitability,” Lightspeed CEO Jean Paul Chauvet said during the company’s Q4 earnings call. Despite macro headwinds such as rising interest rates and persistent inflation, he thinks “we are on track to meet our commitment of adjusted EBITDA breakeven or better in fiscal 2024.”
Credit Suisse’s Chiodo no longer prefers LSPD, though, due to a combination of macro uncertainty, a tough path toward achieving the company’s ~20% adjusted EBITDA margin objective, and “ramping efforts from scaled competitors,” he wrote in a note.
Seeking Alpha contributor Donovan Jones last week also viewed LSPD as a Hold in the near-term given the company’s high operating losses.