Restaurant technology platform Toast Q3 revenue beats estimates on new product launches

Toast

04/11/2025 21:37

Overview

Toast Q3 2025 revenue beats analyst expectations, net income rises yr/yr

Company added 7,500 net new locations, boosting ARR by 30% to $2 bln

Toast expands AI capabilities and strategic partnerships, indicating confidence in growth

Outlook

Toast expects Q4 non-GAAP gross profit of $480 mln to $490 mln, up 22-25%

Company projects Q4 adjusted EBITDA between $140 mln and $150 mln

Toast revises full-year non-GAAP gross profit to $1,865 mln-$1,875 mln, up 32%

Company raises full-year adjusted EBITDA forecast to $610 mln-$620 mln

Result Drivers

ARR GROWTH - ARR increased 30% year over year to $2.0 bln, driven by expansion in locations and services

NEW LOCATIONS - Added approximately 7,500 net new locations in Q3, contributing to ARR growth

PRODUCT INNOVATION - Launches of Toast IQ and Toast Advertising are aiding revenue increase and efficiency

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Beat
$1.63 bln
$1.58 bln (20 Analysts)
Q3 Net Income
$105 mln
Q3 Annual Recurring Revenue
$2 bln
Q3 Gross Profit
$432 mln
Q3 Operating Expenses
$348 mln
Q3 Operating Income
$84 mln


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 16 "strong buy" or "buy", 13 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the software peer group is "buy"

Wall Street's median 12-month price target for Toast Inc is $48.00, about 25.6% above its November 3 closing price of $35.72

The stock recently traded at 49 times the next 12-month earnings vs. a P/E of 80 three months ago

Press Release: ID:nBw8s82Tfa

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)