Lightspeed Commerce Inc.
Condensed Interim Consolidated Financial Statements
(Unaudited)
For the three months ended June 30, 2026
(expressed in thousands of US dollars)


Lightspeed Commerce Inc.
Condensed Interim Consolidated Balance Sheets
(Unaudited)
As at June 30 and March 31, 2026
(expressed in thousands of US dollars)
Notes
June 30,
2026		March 31,
2026
Assets
$
$
Current assets
Cash and cash equivalents372,136 453,906 
Trade and other receivables1071,945 47,601 
Merchant cash advances18116,480 118,442 
Inventories17,173 15,886 
Other current assets1169,616 70,580 
Total current assets647,350 706,415 
Lease right-of-use assets, net
16,875 16,719 
Property and equipment, net
16,920 17,003 
Intangible assets, net
84,308 73,580 
Goodwill768,983 805,051 
Other long-term assets1246,436 38,210 
Deferred tax assets8,229 8,244 
Total assets1,589,101 1,665,222 
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable and accrued liabilities1396,892 80,592 
Lease liabilities5,292 5,255 
Income taxes payable1,447 787 
Deferred revenue78,865 78,475 
Total current liabilities182,496 165,109 
Deferred revenue694 661 
Lease liabilities14,654 14,910 
Other long-term liabilities1,548 1,390 
Total liabilities199,392 182,070 
Shareholders’ equity
Share capital153,665,921 3,919,425 
Additional paid-in capital210,252 208,201 
Accumulated other comprehensive income (loss)16(37)1,879 
Accumulated deficit(2,486,427)(2,646,353)
Total shareholders’ equity1,389,709 1,483,152 
Total liabilities and shareholders’ equity1,589,101 1,665,222 
Commitments and contingencies14

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
2

Lightspeed Commerce Inc.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss
(Unaudited)
For the three months ended June 30, 2026 and 2025
(expressed in thousands of US dollars, except per share amounts)
Three months ended June 30,
Notes
20262025
$
$
Revenues5322,704 304,942 
Direct cost of revenues6, 7184,145 175,869 
Gross profit138,559 129,073 
Operating expenses
General and administrative729,484 34,713 
Research and development731,856 32,425 
Sales and marketing772,338 67,880 
Depreciation of property and equipment1,725 1,635 
Depreciation of right-of-use assets1,261 1,188 
Foreign exchange loss (gain)246 (2,763)
Acquisition-related compensation157 157 
Amortization of intangible assets5,436 34,681 
Restructuring143,688 1,210 
Gain on sale of business4(2,091)— 
Total operating expenses144,100 171,126 
Operating loss(5,541)(42,053)
Net interest income (expense)84,940 (6,209)
Loss before income taxes(601)(48,262)
Income tax expense (recovery)
Current1,820 1,691 
Deferred— (386)
Total income tax expense1,820 1,305 
Net loss(2,421)(49,567)
Other comprehensive income (loss)
Items that may be reclassified to net loss
Foreign currency differences on translation of foreign operations(365)7,402 
Change in net unrealized gain (loss) on cash flow hedging instruments, net of tax(1,551)3,131 
Total other comprehensive income (loss)16(1,916)10,533 
Total comprehensive loss(4,337)(39,034)
Net loss per share – basic and diluted9(0.02)(0.35)
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
3

Lightspeed Commerce Inc.
Condensed Interim Consolidated Statements of Cash Flows
(Unaudited)
For the three months ended June 30, 2026 and 2025
(expressed in thousands of US dollars)
Three months ended June 30,
20262025
Cash flows from (used in) operating activities
$
$
Net loss(2,421)(49,567)
Items not affecting cash and cash equivalents
Amortization of intangible assets5,436 34,681 
Depreciation of property and equipment and lease right-of-use assets2,986 2,823 
Deferred income tax recovery— (386)
Share-based compensation expense11,795 12,963 
Unrealized foreign exchange gain(56)(501)
Gain on sale of business(2,091)— 
(Increase)/decrease in operating assets and increase/(decrease) in operating liabilities
Trade and other receivables(4,132)475 
Merchant cash advances(8,353)2,543 
Inventories(2,275)(332)
Other assets1,119 (1,073)
Accounts payable and accrued liabilities1,272 3,295 
Income taxes payable660 293 
Deferred revenue957 791 
Other long-term liabilities158 182 
Net interest (income) expense(4,940)6,209 
Total operating activities115 12,396 
Cash flows from (used in) investing activities
Additions to property and equipment(1,708)(1,804)
Additions to intangible assets(16,171)(10,515)
Sale of business, net of cash disposed and costs of disposal paid19,069 — 
Interest income 4,967 6,114 
Total investing activities6,157 (6,205)
Cash flows from (used in) financing activities
Proceeds from exercise of stock options3 19 
Shares repurchased and cancelled(65,586)(86,238)
Shares repurchased for settlement of non-treasury RSUs and non-treasury PSUs(21,133)(30,188)
Payment of lease liabilities
(1,105)(2,059)
Financing costs
(51)(9)
Total financing activities(87,872)(118,475)
Effect of foreign exchange rate changes on cash and cash equivalents
(170)1,413 
Net decrease in cash and cash equivalents during the period(81,770)(110,871)

Cash and cash equivalents – Beginning of period453,906 558,469 
Cash and cash equivalents – End of period372,136 447,598 
Income taxes paid789 1,390 
The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
4

Lightspeed Commerce Inc.
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity
(Unaudited)
For the three months ended June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares)
Issued and
Outstanding Shares
Notes
Number
of shares
Amount
Additional
paid-in
capital		Accumulated other comprehensive income (loss)Accumulated
deficit		Total
$$$$$
Balance as at March 31, 2026137,774,851 3,919,425 208,201 1,879 (2,646,353)1,483,152 
Net loss— — — — (2,421)(2,421)
Exercise of stock options and settlement of share awards
431,335 5,813 (5,810)— — 3 
Share-based compensation— — 11,795 — — 11,795 
Shares repurchased and cancelled15(6,973,406)(241,196)— — 161,425 (79,771)
Shares repurchased for settlement of non-treasury RSUs and non-treasury PSUs15(2,200,000)(21,133)— — — (21,133)
Settlement of non-treasury RSUs
15284,118 3,012 (3,934)— 922 — 
Other comprehensive loss 16— — — (1,916)— (1,916)
Balance as at June 30, 2026129,316,898 3,665,921 210,252 (37)(2,486,427)1,389,709 
Balance as at March 31, 2025146,399,347 4,157,395 200,634 (7,462)(2,686,600)1,663,967 
Net loss— — — — (49,567)(49,567)
Exercise of stock options and settlement of share awards366,554 6,104 (6,085)— — 19 
Share-based compensation— — 12,963 — — 12,963 
Shares repurchased and cancelled15(9,013,953)(255,975)— — 182,345 (73,630)
Shares repurchased for settlement of non-treasury RSUs
15(2,594,833)(30,188)— — — (30,188)
Settlement of non-treasury RSUs
1566,754 775 (1,067)— 292 — 
Other comprehensive income16— — — 10,533 — 10,533 
Balance as at June 30, 2025135,223,869 3,878,111 206,445 3,071 (2,553,530)1,534,097 



The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.
5
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)

    1. Organization and nature of operations
Lightspeed Commerce Inc. ("Lightspeed" or the "Company") was incorporated on March 21, 2005 under the Canada Business Corporations Act. Its head office is located at Gare Viger, 700 Saint-Antoine St. East, Suite 300, Montréal, Québec, Canada. Lightspeed's one-stop commerce platform provides its customers with the critical functionalities they need to engage with consumers, manage their operations, order their inventory, accept payments, and run their business. Lightspeed has customers globally in over 100 countries, empowering single- and multi-location small and medium-sized businesses to compete in an omni-channel market environment by engaging with consumers across online, mobile, social, and physical channels.
The Company’s shares are listed on both the Toronto Stock Exchange ("TSX") and the New York Stock Exchange ("NYSE") under the stock symbol "LSPD".
    2. Basis of presentation and consolidation
These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards") applicable to the preparation of interim financial statements, including International Accounting Standard ("IAS") 34, Interim Financial Reporting. Certain information and disclosures have been omitted or condensed. These unaudited condensed interim consolidated financial statements should be read together with the Company’s audited annual consolidated financial statements and notes thereto for the fiscal year ended March 31, 2026.
These unaudited condensed interim consolidated financial statements were approved for issue by the Board of Directors of the Company on July 29, 2026.
Seasonality of interim operations
The operations of the Company are seasonal, and the results of operations for any interim period are not necessarily indicative of operations for the full fiscal year or any future period.
Estimates, judgments and assumptions
The preparation of the unaudited condensed interim consolidated financial statements in accordance with IFRS Accounting Standards requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses during the period. These estimates and assumptions are based on historical experience, expectations of the future, and other relevant factors and are reviewed regularly. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future period affected. Actual results may differ from these estimates.
In preparing these unaudited condensed interim consolidated financial statements, the significant judgments made by management in applying the Company’s accounting policies and the key sources of uncertainty are the same as those applied and described in the Company’s audited annual consolidated financial statements for the fiscal year ended March 31, 2026.
    3. Material accounting policies
The same accounting policies and methods of computation were followed in the preparation of these unaudited condensed interim consolidated financial statements as were followed in the preparation of the most recent audited annual consolidated financial statements.
6
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
New and amended material accounting policies issued but not yet effective
As described in the most recent audited annual consolidated financial statements, the Company continues to evaluate the impact of IFRS 18, Presentation and Disclosure in Financial Statements, on its consolidated financial statements.
    4. Sale of business
On April 28, 2026, the Company sold all of the issued and outstanding capital stock of Provide Holdings Inc., which includes the Company's Upserve U.S. hospitality product line, to an affiliate of Skyview Equity ("Skyview") for $44,000 in cash consideration and up to $37,000 in contingent consideration. For the $44,000 of cash consideration, $20,000 was paid in cash upon closing, and $22,000 is evidenced by a senior secured bridge promissory note bearing interest at 8% per annum on a paid-in-kind basis, with an initial maturity of 90 days from closing. The promissory note includes options to extend for up to two additional 30-day periods, each subject to certain conditions being satisfied including payment of an extension fee. In July 2026, the counterparty exercised the first such extension, extending the maturity of the promissory note for an additional 30-day period. The promissory note is secured by substantially all assets of the sold entities. The promissory note is classified as a financial asset at amortized cost under IFRS 9. The remaining $2,000 of cash consideration is due to be paid within 9 months of closing. An estimated working capital adjustment of $244 was also paid upon closing. This amount remains subject to a post-closing working capital adjustment, in respect of which a receivable of $315 was recognized as at June 30, 2026. The contingent consideration of up to $37,000 shall be paid over two measurement periods ending March 31, 2027 and March 31, 2028 based on the achievement of EBITDA targets as defined in the purchase agreement. In connection with the transaction, the parties entered into transition services agreements at closing to facilitate the orderly transition of operations.
The components of the sale at the disposal date were as follows:
Net assets$
Goodwill35,709 
Intangible assets (fully amortized)— 
Cash400 
Merchant cash advances and other net assets14,915 
Total net assets51,024 
Consideration
Cash consideration received on closing including working capital adjustment20,244 
Senior secured bridge promissory note22,000 
Other consideration receivable2,315 
Fair value of contingent consideration10,398 
Costs of disposal (partially paid)(1,842)
Total consideration less costs of disposal53,115 
Gain on sale of business2,091 
Contingent Consideration
The fair value of the contingent consideration was estimated using a Monte Carlo simulation model applied within a risk-neutral framework. Management's forecasts of Upserve's future EBITDA were adjusted for risk using a discount rate equal to the risk-free rate plus a risk premium, and the resulting risk-adjusted forecasts were simulated under a risk-neutral
7
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
process using risk-free rates and an estimated asset volatility derived from comparable publicly traded companies. The simulated EBITDA outcomes were assessed against the EBITDA targets defined in the purchase agreement over the two-year earn-out period. The resulting expected earn-out payments were discounted to present value using risk-free rates adjusted for the credit risk of the counterparty. The fair value of the contingent consideration is a Level 3 measurement (see note 18). The contingent consideration is classified as a financial asset at fair value through profit or loss under IFRS 9, with changes in fair value recognized in the consolidated statement of loss and comprehensive loss in subsequent reporting periods. The fair value of the contingent consideration is presented as a component of other long-term assets on the consolidated balance sheets. As at June 30, 2026, the fair value of the contingent consideration was reassessed and no change from the initial recognition amount was identified.
Key assumptions used in the fair value measurement include management's forecast EBITDA. Because the contingent consideration is payable only upon achievement of defined EBITDA thresholds, changes in the forecast EBITDA used in the measurement could result in a significant change in the fair value of the contingent consideration. Other assumptions include an asset volatility of 38%, a risk premium of 10%, and a credit spread of 4%, and no reasonably possible change in these assumptions would have a significant effect on the fair value of the contingent consideration.
The movement in the contingent consideration is as follows:
Three months ended June 30,
20262025
$$
Balance - Beginning of period— — 
Contingent consideration added through sale of business10,398 — 
Balance - End of period10,398 — 
    5. Revenues
Three months ended June 30,
20262025
$
$

Subscription revenue95,372 90,862 
Transaction-based revenue214,525 204,559 
Hardware and other revenue12,807 9,521 
Total revenues322,704 304,942 
Transaction-based revenue includes $14,468 of revenue from the Company's merchant cash advance program for the three months ended June 30, 2026 (June 30, 2025 – $10,400).
8
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
    6. Direct cost of revenues

Three months ended June 30,
20262025
$
$
Subscription cost of revenue15,870 17,343 
Transaction-based cost of revenue145,974 144,703 
Hardware and other cost of revenue22,301 13,823 
Total direct cost of revenues184,145 175,869 
    7. Employee compensation
The total employee compensation comprising salaries and benefits, including share-based compensation and related payroll taxes and severances included in restructuring, excluding government assistance and acquisition-related compensation, for the three months ended June 30, 2026, was $92,458 (June 30, 2025 – $85,353).
The following table outlines share-based compensation and related payroll taxes included in the following expenses:
Three months ended June 30,
20262025
$$
Direct cost of revenues519 301 
General and administrative4,148 4,617 
Research and development5,664 5,039 
Sales and marketing2,328 4,012 
Total share-based compensation and related payroll taxes12,659 13,969 
As at June 30, 2026, the Company had 8,798,522 options (309,273 of which have vesting dependent on market conditions tied to the Company's future share price performance), 11,011,437 restricted share units, 1,113,276 performance share units which include non-market performance conditions and 251,643 deferred share units outstanding (June 30, 2025 - 12,884,988 options, 8,147,869 restricted share units, nil performance share units which include non-market performance conditions and 175,198 deferred share units outstanding).
9
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
    8. Finance income and costs
Three months ended June 30,
20262025
$
$

Change in fair value of share repurchase liability342 (11,800)
Interest income4,946 5,888 
Interest expense(348)(297)
Net interest income (expense)4,940 (6,209)
    9. Loss per share
The Company has stock options and share awards as potentially dilutive shares. Diluted net loss per share excludes all potentially-dilutive shares if their effect is anti-dilutive. As a result of net losses incurred, all potentially-dilutive shares have been excluded from the calculation of diluted net loss per share because including them would be anti-dilutive; therefore, basic and diluted number of shares are the same for the three months ended June 30, 2026 and 2025. All outstanding potentially dilutive shares could potentially dilute loss per share in the future.

Three months ended June 30,
20262025
Issued and outstanding Common Shares129,316,898 135,223,869 
Weighted average number of Common Shares outstanding - basic and diluted
138,206,060 140,818,891 
Net loss per share – basic and diluted($0.02)($0.35)
The issued and outstanding Common Shares as at June 30, 2026 are net of 4,014,840 Common Shares that have been purchased and are held in trust as described in note 15 (June 30, 2025 - 2,528,079).
The weighted average number of potentially dilutive shares that are not included in the diluted net loss per share calculations because they would be anti-dilutive was 16,703,863 stock options and share awards for the three months ended June 30, 2026 (June 30, 2025 - 16,353,423). This weighted average number includes all of the Company's issued and outstanding potentially dilutive shares notwithstanding exercise prices, as applicable.
10
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
    10. Trade and other receivables
June 30,
2026		March 31,
2026
$
$
Trade receivables36,167 36,337 
Allowance for expected credit losses(5,640)(5,624)

Trade receivables, net30,527 30,713 
Research and development tax credits receivable7,985 7,772 
Sales tax receivable7,428 7,485 
Consideration receivable on sale of business (see note 4)24,628 — 
Accrued interest and other1,377 1,631 
Total trade and other receivables71,945 47,601 
    11. Other current assets
June 30,
2026		March 31,
2026
$
$
Restricted cash and restricted deposits1,518 1,530 
Prepaid expenses and deposits23,162 23,830 
Commission asset18,734 19,171 
Contract asset and other26,202 26,049 
Total other current assets69,616 70,580 
    12. Other long-term assets
June 30,
2026		March 31,
2026
$
$

Restricted cash697 700 
Prepaid expenses and deposits3,870 4,435 
Commission asset20,775 20,554 
Contract asset10,696 12,521 
Contingent consideration measured at fair value10,398 — 
Total other long-term assets46,436 38,210 
11
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
    13. Accounts payable and accrued liabilities
June 30,
2026		March 31,
2026
$$

Trade payables and trade accruals44,549 38,960 
Accrued compensation and benefits25,634 31,786 
Accrued payroll taxes on share-based compensation3,335 2,929 
Sales tax payable3,648 3,225 
Share repurchase liability14,298 — 
Provisions and other
5,428 3,692 
Total accounts payable and accrued liabilities96,892 80,592 
    14. Contingencies, provisions and commitments
The Company is involved in litigation and claims in the normal course of business. Management is of the opinion that any resulting provisions and ultimate settlements would not materially affect the financial position and operating results of the Company.
Restructuring
The Company implemented a reorganization to streamline the Company's operating model while continuing to focus on profitable growth. The restructuring expense consisted primarily of cash severance costs.
Provision for severance
Three months ended June 30,
20262025
$$
Balance - Beginning of period2,123 1,715 
Expensed during the period3,688 1,210 
Paid during the period(3,624)(2,260)
Balance - End of period2,187 665 
The provision is included in accounts payable and accrued liabilities in the provisions and other category in note 13.
    15. Share capital

The Company’s authorized share capital consists of (i) an unlimited number of Subordinate Voting Shares and (ii) an unlimited number of preferred shares, issuable in series. All references to "Common Shares" refer to Subordinate Voting Shares in the capital of Lightspeed.
12
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
Normal Course Issuer Bid
The TSX and the Board of Directors of the Company approved the renewal of the Company's normal course issuer bid ("NCIB") to purchase at its discretion for cancellation up to 8,478,469 Subordinate Voting Shares of the Company, representing approximately 10% of the Company's "public float" (as defined in the TSX Company Manual) of Subordinate Voting Shares issued as at May 11, 2026, over the twelve-month period commencing on May 25, 2026 and ending no later than May 24, 2027. Any Subordinate Voting Share purchased under the NCIB will be cancelled.
Under the NCIB, other than purchases made under block purchase exemptions, the Company is allowed, subject to applicable securities laws, to purchase daily, through the facilities of the TSX, a maximum of 172,996 Subordinate Voting Shares representing 25% of the average daily trading volume of 691,987 Subordinate Voting Shares, as calculated per the TSX rules for the six-month period ended on April 30, 2026.
In connection with the NCIB, the Company also entered into an automatic share purchase plan ("ASPP") under which a designated broker may purchase Subordinate Voting Shares at times when the Company would ordinarily not be permitted to purchase its Subordinate Voting Shares due to regulatory restrictions and customary self-imposed blackout periods. Any repurchases made under the ASPP are made in accordance with certain purchasing parameters.
During the three months ended June 30, 2026, under the NCIB, the Company repurchased and cancelled 6,973,406 Subordinate Voting Shares, of which certain shares were repurchased pursuant to the ASPP, for a total consideration, including transaction costs, of $65,131 (June 30, 2025 - 9,013,953 Subordinate Voting Shares for a total consideration, including transaction costs, of $85,430). Net interest income for the three months ended June 30, 2026 includes a gain from the change in fair value of the share repurchase liability related to the ASPP of $342 (June 30, 2025 – net interest expense includes a loss from the change in fair value of the share repurchase liability related to the ASPP of $11,800). There was a share repurchase liability outstanding as at June 30, 2026 of $14,298 (March 31, 2026 - nil).
Common Shares purchased for settlement of non-treasury RSUs and PSUs
Non-treasury RSUs and non-treasury PSUs have the same features as RSUs and PSUs, respectively, except that they can either be settled in cash based on the Company’s share price on the settlement date, through the delivery of Common Shares purchased on the open market or a combination thereof at the discretion of the Board. For the three months ended June 30, 2026 and the three months ended June 30, 2025, the non-treasury RSUs were settled in Common Shares purchased on the open market. No non-treasury PSUs vested or were settled during either period.
The Company has established a trust for the purpose of settling vested non-treasury RSUs and non-treasury PSUs. For non-treasury RSUs and non-treasury PSUs, the Company directs the trustee to purchase Common Shares of the Company on the open market to be held in trust for and on behalf of the holders of non-treasury RSUs and non-treasury PSUs until they are released and delivered for settlement. For accounting purposes, the Common Shares are considered as held in treasury, and recorded as a temporary reduction of Common Shares outstanding and as a temporary reduction of share capital equal to the consideration paid, including transaction costs. Upon delivery of the Common Shares for settlement of the non-treasury RSUs and non-treasury PSUs, the number of Common Shares outstanding is increased, offsetting the initial temporary reduction of Common Shares outstanding, and the amount in additional paid-in capital associated with the non-treasury RSUs and non-treasury PSUs being settled is transferred to share capital, offsetting the initial temporary reduction of share capital. Any difference between the additional paid-in capital and the initial temporary reduction of share capital is recorded in accumulated deficit. As at June 30, 2026, a total of 4,014,840 Common Shares purchased for settlement of non-treasury RSUs and non-treasury PSUs were considered as held in treasury and recorded as a temporary reduction of outstanding Common Shares and share capital (June 30, 2025 - 2,528,079 Common Shares).
13
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
    16. Accumulated other comprehensive income (loss)
Foreign currency differences on translation of foreign operations
Hedging reserve
Total accumulated other comprehensive income (loss)
202620252026202520262025
$$$$$$
Balance as at March 31,2,117 (4,966)(238)(2,496)1,879 (7,462)
Foreign currency differences on translation of foreign operations(365)7,402 — — (365)7,402 
Change in net unrealized gain (loss) on cash flow hedging instruments— — (1,551)3,360 (1,551)3,360 
Deferred income tax expense— — — (229)— (229)
Balance as at June 30,1,752 2,436 (1,789)635 (37)3,071 
Foreign exchange forward contracts
The Company designates certain foreign exchange forward contracts as cash flow hedges when all the requirements in IFRS 9, Financial Instruments are met. The Company's currency pair used for cash flow hedges is US dollar / Canadian dollar. The notional principal of the foreign exchange contracts was $95,000 CAD as at June 30, 2026 (March 31, 2026 - $97,500 CAD).
    17. Related party transactions
Key management personnel includes executive officers. Other related parties include close family members of the key management personnel and entities controlled by the key management personnel.
The executive compensation expense of the top five key management personnel is as follows:
Three months ended June 30,
20262025
$$
Short-term employee benefits
1,004 949 
Share-based payments2,155 2,704 
Total compensation expense for key management personnel3,159 3,653 
    18. Financial instruments
Fair value
The Company measures the fair value of certain of its financial assets and financial liabilities using a fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value. The different levels of the fair value hierarchy are defined as follows:
14
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Other techniques for which inputs are based on quoted prices for identical or similar instruments in markets that are not active, quoted prices for similar instruments in active markets, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the asset or liability;
Level 3: Techniques which use inputs that have a significant effect on the recognized fair value that require the Company to use its own assumptions about market participant assumptions.
The Company estimated the fair value of its financial instruments as described below.
The fair value of cash and cash equivalents, trade receivables, the senior secured bridge promissory note and trade payables and accrued liabilities are considered to be equal to their respective carrying values due to their short-term maturities.
Recurring fair value measurements
The fair value of contingent consideration is discussed in note 4.
The fair value of foreign exchange forward contracts was determined based on Level 2 inputs, which included period-end mid-market quotations for each underlying contract as calculated by the financial institution with which the Company has transacted. The quotations represent the discounted future settlement amounts based on current market rates.
The fair value of the share repurchase liability was determined based on Level 2 inputs as the number of shares remaining to be purchased under the ASPP multiplied by the share price, subject to the contractual maximum purchase price.
The fair value of merchant cash advances was determined based on Level 3 inputs by calculating the present value of the future estimated cash flows based on the terms of the agreements. Key assumptions for the three months ended June 30, 2026 include an average repayment period of 7 months, an average discount rate over the repayment period of 14% and amounts deemed uncollectible, which amounts include write-offs, of $4,541. No reasonably possible change in the key assumptions would lead to a significant change in the fair value of merchant cash advances due to their expected short-term repayment periods.
The movement in the merchant cash advances is as follows:
Three months ended
June 30,
20262025
$
$
Balance - Beginning of period118,442 106,169 
Principal issued
112,718 76,774 
Amounts collected(114,292)(86,762)
Transaction-based revenues from fees collected incorporating fair value movement
14,468 10,400 
General and administrative expenses from amounts deemed uncollectible(4,541)(2,955)
Derecognized on sale of business(10,315)— 
Balance - End of period116,480 103,626 

15
Lightspeed Commerce Inc.
Notes to Condensed Interim Consolidated Financial Statements
(Unaudited)
June 30, 2026 and 2025
(expressed in thousands of US dollars, except number of shares and per share amounts)
As at June 30 and March 31, 2026, financial instruments measured at fair value in the consolidated balance sheets were as follows:
June 30, 2026March 31, 2026
Fair
value
hierarchy
Carrying
amount
Fair
value
Fair
value
hierarchy
Carrying
amount
Fair
value
$
$

$$

Assets:
Cash and cash equivalents
Level 1372,136 372,136 Level 1453,906 453,906 
Restricted cash and restricted depositsLevel 12,215 2,215 Level 12,230 2,230 
Merchant cash advancesLevel 3116,480 116,480 Level 3118,442 118,442 
Contingent considerationLevel 310,398 10,398 Level 3— — 
Liabilities:
Foreign exchange forward contractsLevel 21,789 1,789 Level 2238 238 
Share repurchase liabilityLevel 214,298 14,298 Level 2— — 

16