Toast Announces First Quarter 2026 Financial Results

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Key Terms

annualized recurring run-rate financial

Annualized recurring run‑rate is an estimate of how much predictable, repeat revenue a company would generate over the next 12 months if its current level of subscription or contract income continued unchanged. Investors use it to gauge the size and trend of a business’s steady cash flow—like reading the current speed on a car’s dashboard to predict how far you’ll travel in an hour—making it easier to compare growth and valuation across companies.

arr financial

ARR, or Annual Recurring Revenue, is the predictable income a business expects to earn each year from ongoing customer subscriptions or contracts. It’s like a steady paycheck that shows the company's ability to generate consistent revenue over time, helping investors assess its stability and growth potential. ARR provides a clear picture of how well a company is performing in building long-term customer relationships.

gross payment volume financial

Gross payment volume (GPV) is the total dollar value of all transactions processed through a payments platform or marketplace over a period, measured before fees, refunds or adjustments. It shows how much activity the service handles—like measuring how many groceries pass through a store—to signal scale and customer usage; investors use GPV to gauge growth and market share, while remembering it does not equal revenue or profit.

gpv financial

Gross Payment Volume (GPV) is the total value of all transactions processed through a payment platform or merchant network over a given period, before refunds or fees. Think of it as the total cash that passes through a store’s register; it shows how much business the platform is handling. Investors watch GPV because rising volume suggests growing customer activity and revenue potential, while declines can signal weakening demand or competitive pressure.

adjusted ebitda financial

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

free cash flow financial

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

non-gaap financial

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

regulation fd regulatory

Regulation FD is a rule that prevents company insiders, like executives, from sharing important information with some people before others get it. It matters because it helps ensure all investors have equal access to key news, making the stock market fairer and reducing chances of insider trading.

05/07/2026 - 04:05 PM

Annualized recurring run-rate (ARR) grew 26% to $2.2 billion as of March 31, 2026

Added approximately 7,000 net new Locations in first quarter

Net income was $126 million and Adjusted EBITDA was $179 million in first quarter

Repurchased 14 million shares for $378 million year-to-date through May 6, 2026

BOSTON--(BUSINESS WIRE)-- Toast (NYSE: TOST), the global technology platform built for restaurants and retail businesses, today reported financial results for the first quarter ended March 31, 2026.

“2026 is off to a strong start. In Q1 we grew recurring gross profit 27%, expanded GAAP Operating Income margin to 21%, and added approximately 7,000 net locations," said Toast CEO Aman Narang. "AI is helping us both build faster and drive more impact for our customers. For example, the launch of Toast IQ Grow includes our first AI agent and aims to help restaurants optimize their digital presence and drive more demand. We see strong momentum across both our core as well as our new markets, and with the incredible opportunities AI creates I've never been more confident in our ability to scale this business.”

Financial Highlights for the First Quarter of 2026

ARR increased 26% year over year to $2.2 billion as of March 31, 2026.
Total Locations increased 22% year over year to approximately 171,000.
Gross Payment Volume (GPV) increased 22% year over year to $51.3 billion.
Subscription services and financial technology solutions gross profit grew 32% year over year to $520 million. Non-GAAP subscription services and financial technology solutions gross profit grew 27% year over year to $529 million.
Operating income was $110 million in Q1 2026 compared to $43 million in Q1 2025.
Net income was $126 million in Q1 2026 compared to $56 million in Q1 2025. Adjusted EBITDA was $179 million in Q1 2026 compared to $133 million in Q1 2025.
Diluted earnings per share was $0.20 in Q1 2026 compared to $0.09 in Q1 2025.
Net cash provided by operating activities of $132 million and Free Cash Flow of $115 million in Q1 2026, compared to net cash provided by operating activities of $79 million and Free Cash Flow of $69 million, in Q1 2025.

Percentages may not tie due to rounding. For more information on the non-GAAP financial measures and key metrics discussed in this press release, please see the sections titled “Key Business Metrics” and “Non-GAAP Financial Measures,” as well as the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.

Outlook¹

For the second quarter ending June 30, 2026, Toast expects to report:

Non-GAAP subscription services and financial technology solutions gross profit in the range of $565 million to $575 million (22-24% growth compared to Q2 2025).
Adjusted EBITDA in the range of $185 million to $195 million.

For the full year ending December 31, 2026, Toast expects to report:

Non-GAAP subscription services and financial technology solutions gross profit in the range of $2,290 million to $2,320 million (21%-23% growth compared to 2025, up from 20-22% growth).
Adjusted EBITDA in the range of $790 million to $810 million (up from $775 million to $795 million).

The outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. See cautionary note regarding “Forward-looking Statements” in this press release.

Recent Business Highlights

As part of Toast’s Spring release, Toast introduced Toast IQ Grow, a reimagined Toast Local consumer app, and more than 20 product updates across marketing, payroll, inventory, and operations. Toast IQ Grow is a complete marketing solution that handles the day-to-day work of marketing a business. It is anchored by a Marketing Agent² that builds audiences and automates campaigns across channels and meaningfully advances the company’s vision to transition beyond providing software to delivering an agentic platform that does the work for customers. The Toast Local consumer app now features reservation availability at more than 20,000 locations through Resy and Toast Tables, along with access to restaurant loyalty programs and offers, providing more ways for restaurants to reach and retain guests.
Toast launched Toast Drive-Thru, an enterprise-grade solution designed to serve the more than 140,000 drive-thru locations throughout the U.S. Toast Drive-Thru replaces fragmented systems with trusted hardware, POS-native software, and AI voice ordering integrations, and is designed to help quick-service restaurants increase throughput and order accuracy while optimizing labor efficiency through a single platform.
Toast continued to build strategic partnerships with prestigious hospitality brands, including Chicago’s iconic Alinea Group, which operates their namesake Alinea, along with Next, The Aviary, and The Office. Toast was also selected by Hungry Howie's, a popular pizza chain with approximately 500 locations, to modernize systems, attract new franchisees, and handle the complexity of their large-scale operations. In hotels, Toast secured a partnership with Preferred Hotels & Resorts, the world’s largest independent hotel brand, making Toast available at member properties across the United States, United Kingdom, Ireland, and Canada.
Toast launched its Built For Busy brand campaign, celebrating the hard work and dedication at the heart of business ownership and expressing Toast's commitment to helping each of its customers grow and thrive. The campaign features "Windows to Success," a unique out-of-home activation transforming New York City Toast customer restaurant windows into living billboards that spotlight the hard-working teams behind these bustling establishments.

Conference Call Information

Toast will host a live conference call at 5:00 p.m. Eastern Time on Thursday, May 7, 2026. The live webcast of the conference call can be accessed through Toast’s investor relations website at http://investors.toasttab.com. A replay of the webcast will be available for a period of 90 days after the call.

Toast has used, and intends to continue to use, its Investor Relations website (http://investors.toasttab.com), as well as the Toast Newsroom (https://pos.toasttab.com/news), as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Information on or that can be accessed through Toast’s Investor Relations website, or that is contained in any website to which a hyperlink is provided herein is not part of this press release, and the inclusion of Toast’s Investor Relations website address, and any hyperlinks are only inactive textual references.

____________________
¹ A reconciliation of these forward looking Non-GAAP measures to the corresponding GAAP measure is not available without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliations that have not yet occurred, are out of our control, or cannot be reasonably predicted, including but not limited to the change in fair value of our warrant liability and stock-based compensation. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results.
² Currently available in beta

About Toast

Toast is a global technology platform built for restaurant and retail businesses. From the busiest local restaurants and shops to large hospitality brands, Toast helps owners and operators manage their businesses more efficiently, drive guest demand, and build lasting success.

Toast integrates software, agentic AI, payments, financial technology solutions, and hardware with a broad partner ecosystem. Powering billions of purchases throughout local commerce, Toast delivers the precision and innovation required for modern restaurant and retail environments. For more information, visit www.toasttab.com.

Forward-looking Statements

This press release contains “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the context of the statement and generally arise when Toast or its management is discussing its beliefs, estimates or expectations. Such statements generally include the words “believes,” “plans,” “intends,” “targets,” “may,” “could,” “should,” “will,” “expects,” “estimates,” “suggests,” “anticipates,” “outlook,” “continues,” or similar expressions. These statements are not historical facts or guarantees of future performance, but represent the beliefs of Toast and its management at the time the statements were made regarding future events which are subject to certain risks, uncertainties and other factors, many of which are outside Toast’s control. Actual results and outcomes may differ materially from what is expressed or forecast in such forward-looking statements. Forward-looking statements include, without limitation, statements about Toast’s expected financial positions or growth, including guidance on financial results for the second fiscal quarter and full year of 2026; Toast’s operating strategy and view, including the expected product demand, ability and strategy to deliver innovative solutions, and growth of its business; statements about new products and offerings and the benefits thereof; Toast’s investments in technology and infrastructure; arrangements between Toast and its customers, including the planned and future implementation of the Toast platform at such customers’ locations; Toast’s ability to attract and retain customers and the commitments from its customers; competitive positions, financing and capital allocation strategy; and business strategy.

The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in Toast’s filings with the Securities and Exchange Commission (“SEC”), including in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations'' in Toast’s Annual Report on Form 10-K for the year ended December 31, 2025, Toast’s Quarterly Report on Form 10-Q for the three months ended March 31, 2026 that will be filed following this earnings release, and Toast’s subsequent SEC filings. Toast can give no assurance that the plans, intentions, expectations or strategies as reflected in or suggested by those forward-looking statements will be attained or achieved. The forward-looking statements in this release are based on information available to Toast as of the date hereof, and Toast disclaims any obligation to update any forward-looking statements, except as required by law. These forward-looking statements should not be relied upon as representing Toast’s views as of any date subsequent to the date of this press release.

TOAST, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in millions, except per share amounts)

	Three Months Ended March 31,
		2026			2025
Revenue:
Subscription services	$	268		$	209
Financial technology solutions		1,323			1,082
Hardware and professional services		39			46
Total revenue		1,630			1,337
Costs of revenue:
Subscription services		60			66
Financial technology solutions		1,011			831
Hardware and professional services		111			93
Amortization of acquired intangible assets		1			1
Total costs of revenue		1,183			991
Gross profit		447			346
Operating expenses:
Sales and marketing		156			133
Research and development		97			84
General and administrative		84			79
Restructuring expenses		—			7
Total operating expenses		337			303
Operating income		110			43
Other income:
Interest income, net		13			12
Change in fair value of warrant liability		8			3
Income before taxes		131			58
Income tax expense		(5	)		(2	)
Net income	$	126		$	56
Earnings per share:
Basic	$	0.21		$	0.10
Diluted	$	0.20		$	0.09
Weighted-average shares used in computing earnings per share:
Basic		587			575
Diluted		602			603

TOAST, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in millions)

	March 31, 2026			December 31, 2025
Assets:
Current assets:
Cash and cash equivalents	$	1,098		$	1,353
Marketable securities		672			638
Accounts receivable, net		138			127
Inventories, net		136			114
Other current assets		548			437
Total current assets		2,592			2,669
Property and equipment, net		114			105
Operating lease right-of-use assets		24			27
Intangible assets, net		13			14
Goodwill		113			113
Restricted cash		74			71
Other non-current assets		164			146
Total non-current assets		502			476
Total assets	$	3,094		$	3,145
Liabilities and Stockholders’ Equity:
Current liabilities:
Accounts payable	$	70		$	47
Deferred revenue		73			68
Accrued expenses and other current liabilities		921			854
Total current liabilities		1,064			969
Warrants to purchase common stock		11			19
Operating lease liabilities, non-current		17			20
Other long-term liabilities		12			13
Total liabilities		1,104			1,021
Commitments and Contingencies
Stockholders’ Equity:
Preferred stock		—			—
Common stock		—			—
Accumulated other comprehensive income (loss)		(1	)		2
Additional paid-in capital		3,127			3,384
Accumulated deficit		(1,136	)		(1,262	)
Total stockholders’ equity		1,990			2,124
Total liabilities and stockholders’ equity	$	3,094		$	3,145

TOAST, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in millions)

	Three Months Ended March 31,
		2026			2025
Cash flows from operating activities:
Net income	$	126		$	56
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		10			19
Stock-based compensation expense		54			60
Amortization of deferred contract acquisition costs		22			23
Change in fair value of warrant liability		(8	)		(3	)
Credit loss expense		27			22
Other non-cash items		(1	)		—
Changes in operating assets and liabilities:
Accounts receivable, net		(18	)		(9	)
Other current assets		(2	)		(12	)
Deferred contract acquisition costs		(45	)		(33	)
Inventories, net		(22	)		7
Accounts payable		18			10
Accrued expenses and other current liabilities		(32	)		(56	)
Deferred revenue		4			(1	)
Operating lease right-of-use assets and operating lease liabilities, net		1			—
Other assets and liabilities		(2	)		(4	)
Net cash provided by operating activities		132			79
Cash flows from investing activities:
Capital expenditures		(17	)		(10	)
Purchases of marketable securities		(161	)		(110	)
Proceeds from the sale of marketable securities		38			40
Purchases of loans classified as held for investment, net		(23	)		—
Maturities of marketable securities		88			102
Net cash provided by (used in) investing activities		(75	)		22
Cash flows from financing activities:
Change in customer funds obligations, net		82			64
Proceeds from issuance of common stock		14			26
Cash paid to repurchase Class A common stock		(323	)		(17	)
Net cash provided by (used in) financing activities		(227	)		73
Net increase (decrease) in cash, cash equivalents, cash held on behalf of customers and restricted cash		(170	)		174
Cash, cash equivalents, cash held on behalf of customers and restricted cash at beginning of period		1,583			1,085
Cash, cash equivalents, cash held on behalf of customers and restricted cash at end of period	$	1,413		$	1,259
Reconciliation of cash, cash equivalents, cash held on behalf of customers and restricted cash
Cash and cash equivalents		1,098			1,005
Cash held on behalf of customers		241			187
Restricted cash		74			67
Total cash, cash equivalents, cash held on behalf of customers and restricted cash	$	1,413		$	1,259

Non-GAAP Financial Measures

In this press release, Toast refers to non-GAAP financial measures that are derived on the basis of methodologies other than in accordance with United States generally accepted accounting principles (“GAAP”). Toast uses certain non-GAAP financial measures, as described below, to understand and evaluate its core operating performance. These non-GAAP financial measures, which may be different than similarly-titled measures used by other companies, are presented to enhance investors’ overall understanding of Toast’s financial performance and should not be considered substitutes for, or superior to, the financial information prepared and presented in accordance with GAAP. Toast believes that these non-GAAP financial measures provide useful information about its financial performance, enhance the overall understanding of its past performance and future prospects, and allow for greater transparency with respect to important metrics used by Toast’s management for financial and operational decision-making.

In the tables below, Toast has provided reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP. These non-GAAP financial measures should not be considered substitutes for financial measures calculated in accordance with GAAP, and the financial results that Toast calculates and presents in the table in accordance with GAAP, as well as the corresponding reconciliations from those results, should be carefully evaluated.

The following are the non-GAAP financial measures referenced in this press release and presented in the tables below:

Adjusted EBITDA is defined as net income (loss), adjusted to exclude stock-based compensation expense and related payroll tax expense, depreciation and amortization expense, interest income (expense), net, income taxes and certain other items that are not considered to reflect our operating activities and performance within the ordinary course of business, such as restructuring expenses, acquisition expenses, fair value adjustments on warrant liabilities, gain on warrant extinguishment, expenses related to early termination of leases (which includes associated asset impairments) and stock-based charitable contribution expense, as applicable.

Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit is defined as subscription services gross profit and financial technology solutions gross profit, adjusted to exclude stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Costs of Revenue are defined as costs of revenue excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Gross Profit is defined as gross profit excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Subscription Services Gross Profit is defined as subscription services gross profit excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Financial Technology Solutions Gross Profit is defined as financial technology solutions gross profit excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Hardware and Professional Services Gross Profit is defined as hardware and professional services gross profit excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Non-Payments Financial Technology Solutions Gross Profit is defined as financial technology gross profit excluding payments financial technology gross profit.

Non-GAAP Sales and Marketing Expenses are defined as sales and marketing expenses excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP Research and Development Expenses are defined as research and development expenses excluding stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense.

Non-GAAP General and Administrative Expenses are defined as general and administrative expenses excluding stock-based compensation expense and related payroll tax expense, depreciation and amortization expense, acquisition expenses, expenses related to early termination of leases (which includes associated asset impairments), and stock-based charitable contribution expense.

Free Cash Flow is defined as net cash provided by (used in) operating activities reduced by purchases of property and equipment and capitalization of internal-use software costs (collectively referred to as capital expenditures).

Adjusted EBITDA, Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit, Non-GAAP Costs of Revenue, Non-GAAP Gross Profit, Non-GAAP Subscription Services Gross Profit, Non-GAAP Financial Technology Solutions Gross Profit, Non-GAAP Hardware and Professional Services Gross Profit, Non-GAAP Non-Payments Financial Technology Solutions Gross Profit, Non-GAAP Sales and Marketing Expenses, Non-GAAP Research and Development Expenses, Non-GAAP General and Administrative Expenses, and Free Cash Flow do not purport to represent profitability and liquidity measures as defined in accordance with GAAP. These measures are provided to investors and others to improve the quarter-to-quarter and year-to-year comparability of Toast's financial results and to ensure that investors understand the information Toast uses to evaluate the performance of its businesses.

Our definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Further, these metrics have certain limitations since they do not include the impact of certain expenses and cash flows that are reflected in our Consolidated Statements of Operations and Consolidated Statements of Cash Flows. Thus, our Adjusted EBITDA, Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit, Non-GAAP Costs of Revenue, Non-GAAP Gross Profit, Non-GAAP Subscription Services Gross Profit, Non-GAAP Financial Technology Solutions Gross Profit, Non-GAAP Hardware and Professional Services Gross Profit, Non-GAAP Non-Payments Financial Technology Solutions Gross Profit, Non-GAAP Sales and Marketing Expenses, Non-GAAP Research and Development Expenses, Non-GAAP General and Administrative Expenses, and Free Cash Flow should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.

Key Business Metrics

In addition, Toast also uses the following key business metrics to help it evaluate its business, identify trends affecting its business, formulate business plans, and make strategic decisions:

Gross Payment Volume (“GPV”) is defined as the sum of total dollars processed through the Toast payments platform across Toast Processing Locations in a given period. GPV is a key measure of the scale of Toast’s platform, which in turn drives our financial performance. As Toast customers generate more sales and therefore more GPV, Toast generally sees higher financial technology solutions revenue.
Annualized Recurring Run-Rate (“ARR”) is defined as a key operational measure of the scale of Toast’s subscription and payment processing services for both new and existing customers. To calculate ARR, Toast first calculates recurring run-rate on a monthly basis. Monthly Recurring Run-Rate, or MRR, is measured on the final day of each month as the sum of (i) Toast’s monthly billings of subscription services fees, which we refer to as the subscription component of MRR, and (ii) Toast’s in-month adjusted payments services fees, exclusive of estimated transaction-based costs, which we refer to as the payments component of MRR. MRR does not include fees derived from Toast Capital or related costs. MRR is also not burdened by the impact of SaaS credits offered. The MRR calculation includes all locations on the Toast platform and locations on legacy solutions, which have a negligible impact on ARR.

ARR is determined by taking the sum of (i) twelve times the subscription component of MRR and (ii) four times the trailing-three-month cumulative payments component of MRR. Toast believes this approach provides an indication of its scale, while also controlling for short-term fluctuations in payments volume. ARR may decline or fluctuate as a result of a number of factors, including customers’ satisfaction with the Toast platform, pricing, competitive offerings, economic conditions, or overall changes in Toast’s customers’ and their guests’ spending levels. ARR is an operational measure, does not reflect Toast’s revenue or gross profit determined in accordance with GAAP, and should be viewed independently of, and not combined with or substituted for, Toast’s revenue, gross profit, and other financial information determined in accordance with GAAP. Further, ARR is not a forecast of future revenue and investors should not place undue reliance on ARR as an indicator of Toast’s future or expected results.

Locations

We define a live location, or Location, as a unique location that has used Toast Point of Sale to record transaction volumes above a minimum threshold, and has not been marked as a churned location as of the date of determination. A Location can use Toast payment services, which we refer to as a Toast Processing Location, or for select enterprise customers, not use Toast’s payment services, which we refer to as a Non-Toast Processing Location. Customers of legacy solutions provided by companies that we have acquired, that do not use Toast Point of Sale, are not included in our Location count.

Summary of Key Business Metrics and Non-GAAP Results (unaudited)

	Three Months Ended March 31,
(dollars in billions)		2026		2025		% Growth
Gross Payment Volume (GPV)	$	51.3	$	42.2			22	%

	As of March 31,
(dollars in millions)		2026		2025		% Growth
Payments Annualized Recurring Run-Rate	$	1,026	$	830			24	%
Subscription Annualized Recurring Run-Rate		1,125		883			27	%
Total Annualized Recurring Run-Rate (ARR)	$	2,151	$	1,713			26	%

Adjusted EBITDA			Three Months Ended March 31,
(in millions)				2026			2025
Net income			$	126		$	56
Stock-based compensation expense and related payroll tax				58			64
Depreciation and amortization				11			19
Interest income, net				(13	)		(12	)
Change in fair value of warrant liability				(8	)		(3	)
Restructuring expenses⁽¹⁾				—			7
Income tax expense				5			2
Adjusted EBITDA			$	179		$	133

⁽¹⁾Restructuring expenses for the three months ended March 31, 2025 include $4 million of severance benefits and $3 million of stock-based compensation expense.

Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Gross profit (GAAP):
Subscription services	$	208		$	143
Financial technology solutions		312			251
Adjustments:
Stock-based compensation expense and related payroll tax		3			5
Depreciation and amortization		6			16
Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit	$	529		$	415

Non-GAAP Costs of Revenue	Three Months Ended March 31,
(dollars in millions)		2026			2025
Costs of revenue	$	1,183		$	991
Stock-based compensation expense and related payroll tax		(7	)		(11	)
Depreciation and amortization		(8	)		(17	)
Non-GAAP costs of revenue	$	1,168		$	963

Non-GAAP Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Gross profit	$	447		$	346
Stock-based compensation expense and related payroll tax		7			11
Depreciation and amortization		8			17
Non-GAAP gross profit	$	462		$	374

Non-GAAP Subscription Services Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Subscription services gross profit	$	208		$	143
Stock-based compensation expense and related payroll tax		3			5
Depreciation and amortization		6			16
Non-GAAP subscription services gross profit	$	217		$	164

Non-GAAP Financial Technology Solutions Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Financial technology solutions gross profit	$	312		$	251
Stock-based compensation expense and related payroll tax		—			—
Depreciation and amortization		—			—
Non-GAAP financial technology solutions gross profit	$	312		$	251

Non-GAAP Hardware and Professional Services Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Hardware and professional services gross profit	$	(72	)	$	(47	)
Stock-based compensation expense and related payroll tax		4			6
Depreciation and amortization		—			—
Non-GAAP hardware and professional services gross profit	$	(68	)	$	(41	)

Non-GAAP Non-Payments Financial Technology Solutions Gross Profit	Three Months Ended March 31,
(dollars in millions)		2026			2025
Financial technology solutions gross profit	$	312		$	251
Payments financial technology solutions gross profit		(261	)		(204	)
Non-GAAP non-payments financial technology solutions gross profit	$	51		$	47

Non-GAAP Sales and Marketing Expenses	Three Months Ended March 31,
(dollars in millions)		2026			2025
Sales and marketing expenses	$	156		$	133
Stock-based compensation expense and related payroll tax		(14	)		(16	)
Depreciation and amortization		(1	)		—
Non-GAAP sales and marketing expenses	$	141		$	117

Non-GAAP Research and Development Expenses	Three Months Ended March 31,
(dollars in millions)		2026			2025
Research and development expenses	$	97		$	84
Stock-based compensation expense and related payroll tax		(23	)		(22	)
Depreciation and amortization		(1	)		(1	)
Non-GAAP research and development expenses	$	73		$	61

Non-GAAP General and Administrative Expenses	Three Months Ended March 31,
(dollars in millions)		2026			2025
General and administrative expenses	$	84		$	79
Stock-based compensation expense and related payroll tax		(14	)		(15	)
Depreciation and amortization		(1	)		(1	)
Termination of leases		—			—
Stock-based charitable contribution expense		—			—
Non-GAAP general and administrative expenses	$	69		$	63

Free Cash Flow	Three Months Ended March 31,
(dollars in millions)		2026			2025
Net cash provided by operating activities	$	132		$	79
Capital expenditures		(17	)		(10	)
Free cash flow	$	115		$	69

Sums may not equal totals due to rounding.

TOST-FIN

Source: Toast, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260507253488/en/

Media: media@toasttab.com
Investors: IR@toasttab.com

Source: Toast, Inc.

Toast Announces First Quarter 2026 Financial Results

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