Revenue growth has normalized to 21.9% in 2026Q1, while gross margins have expanded significantly from 21.8% in 2023Q4 to 27.4% due to a favorable shift toward higher-margin software offerings.
| Sales/Revenue | 6.45B | 6.15B | 4.96B | 3.87B | 2.73B | 1.71B | 823M | 665M |
| Revenue Growth % | 23.44% | 24.05% | 28.33% | 41.52% | 60.18% | 107.17% | 23.76% | - |
| Cost of Goods Sold | 4.75B | 4.56B | 3.77B | 3.03B | 2.22B | 1.39B | 683M | 603M |
| COGS % of Revenue | - | 74.11% | 76.01% | 78.42% | 81.29% | 81.58% | 82.99% | 90.68% |
| Gross Profit | 1.69B | 1.58B | 1.19B | 834M | 511M | 314M | 140M | 62M |
| Gross Margin % | 26.23% | 25.76% | 23.99% | 21.58% | 18.71% | 18.42% | 17.01% | 9.32% |
| Gross Profit Growth % | - | 33.19% | 42.69% | 63.21% | 62.74% | 124.29% | 125.81% | - |
| Operating Expenses | 1.33B | 1.28B | 1.17B | 1.12B | 895M | 542M | 360M | 275M |
| OpEx % of Revenue | - | 20.8% | 23.67% | 29% | 32.77% | 31.79% | 43.74% | 41.35% |
| Selling, General & Admin | 943M | 915M | 777M | 763M | 613M | 379M | 251M | 211M |
| SG&A % of Revenue | - | 14.87% | 15.67% | 19.74% | 22.45% | 22.23% | 30.5% | 31.73% |
| Research & Development | 385M | 371M | 351M | 358M | 282M | 163M | 109M | 64M |
| R&D % of Revenue | - | 6.03% | 7.08% | 9.26% | 10.33% | 9.56% | 13.24% | 9.62% |
| Other Operating Expenses | 0 | -6M | 46M | 0 | 0 | 0 | 0 | 0 |
| Operating Income | 363M | 305M | 16M | -287M | -384M | -228M | -220M | -213M |
| Operating Margin % | 5.63% | 4.96% | 0.32% | -7.43% | -14.06% | -13.37% | -26.73% | -32.03% |
| Operating Income Growth % | - | 1806.25% | 105.57% | 25.26% | -68.42% | -3.64% | -3.29% | - |
| EBITDA | 419M | 372M | 62M | -255M | -360M | -207M | -193M | -206M |
| EBITDA Margin % | 6.5% | 6.05% | 1.25% | -6.6% | -13.18% | -12.14% | -23.45% | -30.98% |
| EBITDA Growth % | 149.4% | 500% | 124.31% | 29.17% | -73.91% | -7.25% | 6.31% | - |
| D&A (Non-Cash Add-back) | 56M | 67M | 46M | 32M | 24M | 21M | 27M | 7M |
| EBIT | 384M | 305M | 62M | -287M | -384M | -228M | -236M | -212M |
| Net Interest Income | 39M | 51M | 42M | 37M | 11M | -12M | -11.81M | 2M |
| Interest Income | 39M | 51M | 42M | 37M | 11M | 0 | 842K | 2M |
| Interest Expense | 0 | 0 | 0 | 0 | 0 | 12M | 12.65M | 0 |
| Other Income/Expense | 56M | 41M | 6M | 43M | 107M | -262M | -28M | 1M |
| Pretax Income | 419M | 346M | 22M | -244M | -277M | -490M | -248M | -212M |
| Pretax Margin % | 6.5% | 5.62% | 0.44% | -6.31% | -10.14% | -28.74% | -30.13% | -31.88% |
| Income Tax | 7M | 4M | 3M | 2M | -2M | -3M | 0 | -3M |
| Effective Tax Rate % | 1.67% | 1.16% | 13.64% | -0.82% | 0.72% | 0.61% | 0% | 1.42% |
| Net Income | 412M | 342M | 19M | -246M | -275M | -487M | -248M | -209M |
| Net Margin % | 6.39% | 5.56% | 0.38% | -6.36% | -10.07% | -28.56% | -30.13% | -31.43% |
| Net Income Growth % | 160.76% | 1700% | 107.72% | 10.55% | 43.53% | -96.37% | -18.66% | - |
| Net Income (Continuing) | 412M | 342M | 19M | -246M | -275M | -487M | -248M | -209M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 0.68 | 0.56 | 0.03 | -0.47 | -0.72 | -0.97 | -0.54 | -0.45 |
| EPS Growth % | 177.19% | 1639.13% | 106.85% | 34.72% | 25.77% | -79.63% | -20% | - |
| EPS (Basic) | - | 0.59 | 0.03 | -0.47 | -0.72 | -0.97 | -0.54 | -0.45 |
| Diluted Shares Outstanding | 602M | 607M | 591M | 533M | 512.24M | 502.61M | 461.18M | 461.18M |
| Basic Shares Outstanding | 587M | 582M | 559M | 532M | 511.75M | 500.05M | 461.18M | 461.18M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - |
Macro-sensitive transaction volume
As reported in recent financial filings, Toast's quarterly revenue growth has decelerated from 34.9% in 2023Q4 to 21.9% by 2026Q1, reflecting a transition from hyper-growth to a more sustainable expansion phase as the company captures significant share within the domestic restaurant technology market.
The consistent decline in year-over-year growth rates suggests that the initial land-grab phase is maturing, forcing the company to rely more heavily on ARPU expansion rather than pure location additions. Investors should monitor whether this deceleration indicates market saturation in the mid-market segment or a strategic shift toward higher-quality, lower-churn enterprise clients.
Based on the provided income statement data, gross margins have steadily improved from 21.8% in 2023Q4 to 27.4% in 2026Q1, indicating that the company is successfully scaling its higher-margin software modules relative to the lower-margin payment processing and hardware segments that historically suppressed profitability.
This margin expansion appears to be a direct result of the company's 'land and expand' strategy, where the incremental cost of adding software services to existing POS terminals is minimal. Continued margin improvement will likely depend on the company's ability to maintain pricing power in its fintech stack despite potential competitive pressure.
According to the latest quarterly results, operating income has scaled from a loss of $56 million in 2023Q4 to a positive $110 million in 2026Q1, demonstrating that the company has successfully achieved the operating leverage necessary to outpace its historical overhead and customer acquisition costs.
The divergence between revenue growth and operating income growth suggests that management has gained better control over SG&A expenses as the business reaches scale. This trend warrants further investigation into whether the current operating margin of 6.7% is sustainable or if it remains vulnerable to future reinvestment requirements.
As indicated by the financial statements, the company achieved a significant milestone in 2026Q1 by reporting zero stock-based compensation, a stark contrast to the $71 million expense recorded in 2023Q4, which significantly enhances the quality and cash-generative nature of the reported net income.
The elimination of SBC as a major non-cash expense suggests a more disciplined approach to compensation and a clearer path to genuine shareholder value creation. Analysts should remain cautious, however, as any return to aggressive equity-based incentives could quickly dilute the quality of these earnings.
While the company has demonstrated impressive operational progress, the reliance on payment processing volume, which accounts for the bulk of revenue, leaves the income statement highly exposed to consumer discretionary spending shifts, as evidenced by the inherent volatility in transaction-based fintech revenue streams.
Short-term profitability gains may mask the underlying risk that a broader economic downturn could lead to reduced restaurant transaction volumes and increased credit losses within the Toast Capital portfolio. Investors should consider whether the current valuation adequately prices in the potential for a cyclical contraction in GPV.
Quick answers to the most common questions about buying TOST stock.
For fiscal year 2025, Toast, Inc. (TOST) reported total revenue of $6.15B. This represents a 825.3% increase compared to $665.0M in 2019.
Toast, Inc. (TOST) is profitable, generating $342.0M in net income for the fiscal year ending 2025 with a net profit margin of 5.6%.
Toast, Inc. (TOST) reported an operating income of $305.0M, resulting in an operating profit margin of 5.0%. This margin reflects the operational efficiency of the business before interest and taxes.
Toast, Inc. (TOST) generated $1.58B in gross profit for the year, representing a gross profit margin of 25.8%. This demonstrates the company's core pricing power and production efficiency.