Toast outlines 20%-22% recurring gross profit growth for 2026 while advancing AI-driven platform strategy
View original at seekingalpha.comToast outlines 20%-22% recurring gross profit growth for 2026 while advancing AI-driven platform strategy Earnings Call Insights: Toast, Inc…
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Toast is a lot more than just a software provider for customers, evolving into a platform
80% confidenceToast guidance includes approximately 150 basis points of negative impact from higher memory chip costs for hardware
80% confidenceToast achieved recurring gross profits growth of 33% in 2025
80% confidenceToast expects Q1 2026 adjusted EBITDA of $160 million to $170 million
80% confidenceToast expanded adjusted EBITDA margin to 34% in 2025
80% confidenceGAAP operating income was $292 million in 2025, up from just $16 million a year ago
80% confidenceToast expects another year of record net location adds and consistent ARPU growth
80% confidenceNet location adds increased every quarter versus a year ago in 2025
80% confidenceToast ended 2025 with 164,000 locations
80% confidenceCustomers value ToastIQ as a copilot that can be queried for faster task execution
80% confidenceThe new TAM should grow further, which is why Toast has confidence that net add growth in 2026 should be even higher than 2025
80% confidenceToastIQ not only generates reports and insights about restaurant performance, it executes tasks directly in Toast ranging from menu management to inventory updates
80% confidenceToast expects adjusted EBITDA of $775 million to $795 million for full year 2026
80% confidenceToast added over 30,000 net locations to the Toast platform in 2025
80% confidenceToast's margin framework targeting 40% margins over the long term remains unchanged
80% confidenceARR grew 26% in 2025
80% confidenceToastIQ and the adoption of ToastIQ is really the foundation for AI strategy
80% confidenceLess than 4 months post launch, over half of all Toast locations have used ToastIQ, collectively sending over 8 million queries
80% confidence2026 reflects Toast's conviction behind new TAMs
80% confidenceToast now powers 20% of the U.S. SMB and mid-market restaurant segment
80% confidenceEmerging TAMs across retail, international and enterprise doubled ARR in 2025
80% confidenceAI is an opportunity for Toast to lean in even further and strengthen competitive moat
80% confidenceToast expects 20% to 22% growth in recurring gross profit streams for full year 2026
80% confidenceToast delivered adjusted EBITDA of $633 million and free cash flow of $608 million in 2025
80% confidenceToast's U.S. market share has nearly doubled over the past three years
80% confidenceCore SaaS ARPU is growing faster than the total company because new TAMs today have lower SaaS ARPUs but are expected to grow as they scale
80% confidenceToast expects Q1 2026 total fintech and subscription gross profit growth of 22% to 24% year-over-year
80% confidence