Toast (NYSE:TOST) Releases Earnings Results, Misses Expectations By $0.08 EPS

Toast (NYSE:TOST) issued its earnings results on Thursday. The company reported $0.16 earnings per share for the quarter, missing the consensus estimate of $0.24 by ($0.08), Zacks reports. Toast had a net margin of 4.68% and a return on equity of 15.77%.

Here are the key takeaways from Toast’s conference call:

• Toast reported strong 2025 results with recurring gross profit up 33%, ARR above $2 billion, a record ~30,000 net location adds, and robust profitability (Adjusted EBITDA of $633M and FCF of $608M).
• Toast IQ (conversational AI) saw rapid adoption—used by over half of locations within months and >1M queries—and is already automating support and routine workflows, which management says should raise ARPU and improve margins over time.
• Expansion into new “towns” is gaining traction: enterprise wins (Applebee’s, Firehouse Subs, Papa Murphy’s), launch in Australia, and scaled retail rollouts; management says these new verticals are growing faster than the core at comparable stages and can be material long‑term growth drivers.
• 2026 guidance targets 20%–22% growth in recurring gross profit and Adjusted EBITDA of $775M–$795M, but management warned of near-term headwinds—~150 basis points of incremental cost from higher memory chip prices, higher tariffs, and negative hardware/professional services contribution—that could pressure margins in the short term.

Toast Stock Down 6.7%

Shares of TOST stock traded down $1.89 during mid-day trading on Thursday, reaching $26.13. 24,385,342 shares of the company’s stock traded hands, compared to its average volume of 11,820,238. The company’s 50-day moving average price is $33.90 and its 200-day moving average price is $37.51. The company has a market cap of $13.46 billion, a P/E ratio of 60.77 and a beta of 1.93. Toast has a 12 month low of $25.91 and a 12 month high of $49.66.

Analyst Ratings Changes

Several research analysts have recently issued reports on TOST shares. Wolfe Research cut shares of Toast from an “outperform” rating to a “peer perform” rating in a report on Thursday, January 8th. JPMorgan Chase & Co. raised shares of Toast from a “neutral” rating to an “overweight” rating and set a $43.00 price target for the company in a research report on Thursday, December 4th. BNP Paribas Exane upgraded shares of Toast from a “hold” rating to an “outperform” rating and set a $40.00 price objective on the stock in a research report on Monday, December 1st. Weiss Ratings reaffirmed a “hold (c-)” rating on shares of Toast in a research note on Monday, December 29th. Finally, Morgan Stanley raised their target price on Toast from $54.00 to $56.00 and gave the stock an “overweight” rating in a research note on Wednesday, November 5th. Two equities research analysts have rated the stock with a Strong Buy rating, thirteen have assigned a Buy rating and eight have assigned a Hold rating to the company. Based on data from MarketBeat.com, Toast has an average rating of “Moderate Buy” and an average price target of $45.55.

Insider Buying and Selling at Toast

In related news, President Stephen Fredette sold 1,060 shares of the company’s stock in a transaction that occurred on Tuesday, February 3rd. The stock was sold at an average price of $30.34, for a total value of $32,160.40. Following the sale, the president owned 913,067 shares in the company, valued at $27,702,452.78. This represents a 0.12% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at this hyperlink. Also, General Counsel Brian R. Elworthy sold 3,303 shares of the firm’s stock in a transaction that occurred on Monday, January 5th. The shares were sold at an average price of $34.38, for a total value of $113,557.14. Following the transaction, the general counsel directly owned 235,757 shares of the company’s stock, valued at approximately $8,105,325.66. This trade represents a 1.38% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 100,856 shares of company stock valued at $3,540,449 over the last three months. 12.14% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Toast

Several institutional investors and hedge funds have recently modified their holdings of the stock. BOKF NA raised its holdings in Toast by 4.5% in the 3rd quarter. BOKF NA now owns 8,023 shares of the company’s stock worth $293,000 after acquiring an additional 345 shares during the last quarter. Parallel Advisors LLC boosted its position in Toast by 39.9% in the third quarter. Parallel Advisors LLC now owns 7,917 shares of the company’s stock worth $289,000 after purchasing an additional 2,259 shares during the last quarter. Advisory Services Network LLC grew its position in Toast by 17.4% during the second quarter. Advisory Services Network LLC now owns 11,237 shares of the company’s stock valued at $549,000 after buying an additional 1,667 shares during the period. Geneos Wealth Management Inc. increased its stake in shares of Toast by 2,861.9% in the 2nd quarter. Geneos Wealth Management Inc. now owns 7,316 shares of the company’s stock worth $324,000 after purchasing an additional 7,069 shares in the last quarter. Finally, FJ Capital Management LLC bought a new position in Toast in the 2nd quarter worth $275,000. 82.91% of the stock is currently owned by institutional investors.

About Toast

Toast, Inc (NYSE: TOST) is a technology company that builds a cloud-based platform for restaurants and other foodservice businesses. Headquartered in Boston, Massachusetts, Toast offers integrated point-of-sale (POS) systems and a suite of software and hardware designed to streamline front-of-house and back-of-house operations. The company went public in 2021 and has positioned itself as a vertically integrated provider for the restaurant industry.

Toast’s product portfolio includes touchscreen POS terminals and handheld order-and-pay devices, kitchen display systems, and peripherals tailored for high-volume foodservice environments.