Tech company Lightspeed POS Inc (TSX:LSPD) soared 20% last week after the company released its earnings for the second quarter, ending Sept. 30. Sales of $45.5 million grew 62% year over year. The company credits part of this growth to the acquisitions of Gastrofix and Kounta, which weren't included in the prior-year period's results.
And of that total revenue, $41.1 million was recurring as Lightspeed's customers continue using its platform during these troubled times. In the first quarter, Lightspeed reported sales of $36.2 million. Lightspeed's projecting sales for the third quarter to come in between $44 million and $47 million.
Many customers are still signing up for its service due to COVID-19 with Lightspeed CFO Brandon Nussey stating that "the digital transformation brought on by the pandemic led to strong demand for new customer additions, growing our customer location count to over 80,000."
The company also announced it would be acquiring a cloud company, ShopKeep Inc., which has more than 20,000 business owners in the U.S. using its platform. Focusing on retail and food and beverage, it makes Lightspeed more dependent on two of the hardest hit industries during the coronavirus pandemic.
As well as Lightspeed's been doing, the stock could be vulnerable during a market crash or further shutdowns. Since the bulk of its customers are in industries that are struggling hard, this is not the safest place to be investing in right now. Although Lightspeed's shares are up more than 40% this year, things could quickly turn south for the tech company if its customers face more challenges ahead, which is a very real risk as the pandemic is nowhere near over.
