Toast (TOST) Q1 2025 earnings summary

Executive summary

• Q1 2025 results exceeded expectations, with revenue up 24% to $1.34 billion, net income of $56 million, and strong growth in net locations, gross profit, and adjusted EBITDA, leading to a raised full-year outlook.

• Over 6,000 net locations were added, bringing the total to approximately 140,000, up 25% year over year.

• Major enterprise wins, including Applebee's and Topgolf, highlight the platform's scalability and versatility.

• Gross Payment Volume reached $42.2 billion, up 22% year over year.

• Launched AI solutions such as ToastIQ and Sous Chef, enhancing customer operations and guest experience.

Financial highlights

• ARR grew 31% year over year to $1.71 billion; SaaS ARR up 32%, driven by location growth and a 5% increase in SaaS ARPU.

• Subscription services revenue increased 38% to $209 million; financial technology solutions revenue rose 24% to $1.08 billion.

• Adjusted EBITDA reached $133 million (32% margin), up from $57 million in Q1 2024.

• Free cash flow was $69 million, compared to negative $33 million in the prior year period.

• Gross profit was $346 million, up from $249 million a year ago.

Outlook and guidance

• Full-year guidance raised: 25–27% growth in fintech and subscription gross profit and $540–$560 million in Adjusted EBITDA.

• Q2 guidance: subscription and fintech gross profit growth of 26–29% year over year; Adjusted EBITDA of $130–$140 million.

• Guidance reflects stable consumer trends, seasonality, and slightly higher hardware tariff expenses.