Toast Q3 revenue slightly beats after adding new locations
Overview
US restaurant technology platform's Q3 revenue was a slight beat versus analyst expectations
Net income rose yr/yr to $169 mln in Q3
CFO Elena Gomez to step down; Michael Senno named successor effective Jan 2027
Outlook
Toast sees Q4 non-GAAP subscription and fintech gross profit at $610 mln-$620 mln
Company expects Q4 adjusted EBITDA of $200 mln-$210 mln
Toast forecasts 2026 non-GAAP subscription and fintech gross profit at $2.375 bln-$2.385 bln
Result Drivers
LOCATION GROWTH - Co added about 8,500 net new locations in Q3, contributing to revenue and profit increases
HIGHER ARR - Annualized recurring run-rate increased 24% yr/yr to $2.5 bln, reflecting growth in subscription and payment processing services
SUBSCRIPTION & PAYMENTS - Gross profit from subscription services and financial technology solutions rose 29% yr/yr
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Slight Beat* | $1.98 bln | $1.97 bln (26 Analysts) |
Q3 EPS | $0.29 | ||
Q3 Net Income | $169 mln | ||
Q3 Annual Recurring Revenue | $2.50 bln | ||
Q3 Gross Profit | $543 mln | ||
Q3 Operating Expenses | $378 mln | ||
Q3 Operating Income | $165 mln |
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 21 "strong buy" or "buy", 12 "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 $39.00, about 16.7% above its November 2 closing price of $33.42
The stock recently traded at 28 times the next 12-month earnings vs. a P/E of 31 three months ago
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For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.
(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.)