Core Insights - Toast, Inc. (TOST) is projecting a 29% year-over-year growth in fintech and subscription gross profit for 2025, an increase from its previous outlook of 25-27% [1] - The company is expanding its presence in U.S. SMB restaurants and entering new international markets, including Australia, which marks its fourth international market [2][10] - A strategic partnership with American Express aims to enhance dining experiences and create new revenue streams [3][10] Growth Strategy - Toast's expansion into Australia includes onboarding its first customer, Graze Craze, which opted for Toast's services over local providers [2] - The partnership with American Express will integrate guest tools from Resy and Tock with Toast's Digital Chits, providing customer insights and exploring new benefits for AMEX Card Members [3] Market Performance - Toast has seen a 24% year-over-year increase in locations served, reaching 148,000, with over 10,000 sites in international markets and enterprise customers [5] - The total fintech and subscription gross profit rose 35% year-over-year to $464 million, with expectations of $465-475 million for the third quarter, indicating a growth of 23-26% [5] Competitive Landscape - Toast is gaining market share in SMB sectors, even in areas with over 30% penetration, indicating the effectiveness of its local go-to-market strategy [4] - The company faces competition from local POS providers and major software firms like Block and Oracle [6] Financial Outlook - The Zacks Consensus Estimate for TOST's earnings for 2025 has been revised up by 12.8% to 97 cents [14] - TOST shares have increased by 73.5% over the past year, outperforming the Zacks Internet-Software industry's growth of 36.9% [12]

Core Insights - Toast, Inc. (TOST) shares have increased by 78% over the past year, significantly outperforming the Internet Software market and the Zacks Computer & Technology sector, which grew by 43.6% and 25.4% respectively [1][8] - The company is a leading provider of software-as-a-service (SaaS) and hardware solutions tailored for the restaurant market [1] Financial Performance - In the second quarter, TOST reported revenues of $1.55 billion, marking a nearly 25% increase and surpassing the Zacks Consensus Estimate by 1.1% [5][8] - The annualized recurring run-rate (ARR) rose by 31% to $1.9 billion [5] - TOST added a record 8,500 net new locations, bringing the total to 148,000, which is a 24% year-over-year increase [6][8] - The company anticipates a 29% growth in fintech and subscription gross profit for 2025, up from an earlier estimate of 26% [10] Market Expansion and Product Innovation - TOST is expanding its presence in the U.S. SMB restaurant market and has ventured into Australia, its fourth international market [6][7] - The launch of Toast Go 3 Handheld, featuring ToastIQ, aims to enhance the ordering and payment process for restaurant staff [9] - The company has surpassed 10,000 live locations across various segments, indicating strong traction among large QSR brands [7] Challenges and Competitive Landscape - The restaurant industry faces challenges such as consumer spending fluctuations, labor inflation, and supply chain volatility, which could impact TOST's performance [11] - A decline in gross payment volume (GPV) per location poses a risk, despite overall GPV increasing by 23% year-over-year to $50 billion [12] - Competitive pressures from companies like Block, Oracle, and Lightspeed could limit TOST's growth potential [16][18] Valuation Concerns - TOST's stock is considered to have a stretched valuation, with a price/book multiple of 12.07X compared to the industry's 6.94X [19][20] - The company is currently rated with a Zacks Rank 3 (Hold), suggesting caution for new investors [25]

Core Insights - Maplewood Senior Living and its luxury brand Inspīr have achieved national recognition with three executive chefs winning awards at the 2025 DISHED Senior Living Dining Innovation Awards [1][6] - The return of Jason Wallin as Corporate Director of Culinary Services marks a new chapter in enhancing wellness-driven dining experiences [2][5] - The awards highlight the exceptional talent and creativity of the culinary teams, emphasizing a commitment to innovation in senior living dining [3][6] Culinary Innovation Recognition - The DISHED Culinary Canvas Award was given to Picasso Petion, Executive Chef at Maplewood at Strawberry Hill, for his ability to blend artistry with comfort in menu design [4] - Richard McCreadie, Executive Chef for Inspīr Embassy Row, focuses on crafting menus that reflect residents' stories while prioritizing local and seasonal ingredients [8] - Steven Weintraub, Executive Chef at Inspīr Carnegie Hill, is recognized for his innovative approach to wellness, particularly in memory care programs [8] Leadership and Vision - Jason Wallin brings over 20 years of culinary leadership back to Maplewood, enhancing the company's commitment to exceptional dining experiences [5][6] - Eileen Duggan, SVP of Operations, emphasizes Wallin's alignment with the company's mission to deliver outstanding experiences to residents [6] - The combination of award-winning chefs and visionary leadership is set to elevate the dining experience in senior living [3][6] Company Overview - Maplewood Senior Living operates 16 upscale senior living communities across several states, including Connecticut, Massachusetts, New Jersey, New York, and Ohio [7] - The Inspīr brand redefines urban senior living, offering luxury accommodations and a focus on whole-person wellness [10] - The flagship residence, Inspīr Carnegie Hill, is located in New York City, with a new location, Inspīr Embassy Row, recently opened in Washington D.C. [10]

Core Viewpoint - Toast is experiencing strong growth and market share gains, making it an attractive investment opportunity despite a recent dip in stock price [1][10]. Group 1: Quarterly Performance - In Q2, Toast reported a 25% increase in total revenue, reaching $1.55 billion, with subscription revenue rising 37% to $227 million and financial technology revenue increasing by 25% [5]. - The company's gross payment volume (GPV) grew by 23% to $49.9 billion, and earnings per share (EPS) increased from $0.02 to $0.13 [6]. - Adjusted EBITDA surged 75% from $92 million a year ago to $161 million [6]. Group 2: Market Expansion - Toast added a record 8,500 net new locations in Q2, totaling approximately 148,000 locations, representing a 24% year-over-year increase [2]. - The company now serves over 10,000 locations in newer segments, including large-scale chains and international markets, having recently launched in Australia [3]. - Toast is gaining market share, particularly in its top 10 markets, where it has over 30% penetration [4]. Group 3: Future Outlook - Toast raised its full-year revenue and adjusted EBITDA guidance, projecting subscription services and fintech gross profit to be between $1.815 billion and $1.835 billion, indicating 28% to 29% growth [7][8]. - For Q3, the company anticipates subscription services and financial technology solutions gross profit to grow by 23% to 26%, with adjusted EBITDA expected to be between $140 million and $150 million [8]. Group 4: Competitive Position - Toast is becoming a clear market leader in the local restaurant technology space, with significant growth potential in enterprise chain restaurants, food retailers, and international markets [11]. - The company's innovative technology is designed to help restaurant customers drive sales and operate more efficiently, benefiting Toast through its payment processing platform [10]. Group 5: Valuation - The best way to value Toast is based on its annual recurring revenue (ARR), projected to reach around $2.1 billion by 2025, with the stock trading at an 11.5 times enterprise value-to-ARR multiple, which is considered reasonable given its approximately 30% ARR growth [12].

Core Insights - Toast stock (NYSE: TOST) is considered a more attractive investment compared to Block stock (NYSE: XYZ) due to its stronger growth, profitability, and financial standing [2][7]. Growth Potential - Toast has demonstrated an impressive average revenue growth of 39% over the past three years, significantly outpacing Block's 13% [7]. - The company generated $1.9 billion in Annual Recurring Revenue (ARR) and achieved a 35% year-over-year increase in recurring gross profit in the most recent quarter [4]. - Toast is projected to scale up to 200,000 locations by 2026, with an anticipated average revenue per user increase from the rollout of 'Toast Now AI' [6]. Profitability and Financial Health - Toast's operating cash flow margin stands at 9%, which is higher than Block's 5.6% [7]. - The company's debt-to-equity ratio is under 1%, compared to Block's 12.6%, indicating a healthier balance sheet [7]. - Cash constitutes 58% of Toast's assets, while it only represents 35% of Block's assets [7]. Market Position and Competitive Edge - Toast differentiates itself with AI-driven solutions like ToastIQ and Toast Now AI, leveraging unique restaurant data to provide valuable insights [5]. - The combination of advanced AI and a comprehensive restaurant management platform positions Toast as a leader in the restaurant technology AI sector [5]. Risks and Challenges - Toast's stock has experienced significant volatility, suffering an 80% drop during the inflation shock of 2022, indicating susceptibility to market fluctuations [3]. - The company faces strong competition from established point-of-sale players and new entrants like DoorDash, which could threaten its market position [9]. - Toast's reliance on the restaurant sector makes it vulnerable to economic downturns, as restaurant revenues typically decline during such periods [9][11].

Core Insights - American Express Company (AXP) has established a multi-year strategic partnership with Toast, Inc. to enhance hospitality experiences by integrating guest data from its restaurant reservation platforms into Toast's systems [1][2] - This partnership strengthens AXP's position in the restaurant and hospitality ecosystem, creating a seamless guest experience from reservation to payment [2][4] - AXP differentiates itself from competitors by linking card membership to exclusive, data-enhanced hospitality services, which can drive higher loyalty and spending among cardmembers [3][5] Company Strategy - The integration of Resy and Tock listings into Toast's platforms enhances visibility and marketing for restaurants, potentially improving retention and attracting more establishments to Toast [4][7] - AXP's approach allows it to deepen customer relationships and expand merchant acceptance, while Toast benefits from new traffic sources and tools [4][5] Competitive Advantage - AXP sets itself apart from Visa and Mastercard by integrating deeply into the hospitality journey, offering personalized dining experiences and creating value beyond transactions [5][6] - This end-to-end control reinforces AXP's premium image and positions it as a hospitality partner rather than just a payment processor [5][6] Financial Performance - AXP shares have declined 0.5% year-to-date, while the industry has grown by 2.3% [6] - AXP trades at a forward price-to-earnings ratio of 17.87, below the industry average of 20.89, with a Value Score of B [9] - The Zacks Consensus Estimate for AXP's 2025 earnings is $15.26 per share, indicating a 14.3% increase from the previous year [10][12]

Financial Performance - Toast's recurring gross profit grew 35% year-over-year with 35% margins [2] - Toast surpassed $2 billion in annual recurring revenue (ARR) [2] - Toast exceeded $200 billion in restaurant sales volume, nearly triple since its IPO [3] Strategic Partnerships & Expansion - Toast announced a new partnership with American Express [1] - Toast is expanding into new market segments including international (UKI, Canada, Australia), enterprise, and retail (grocery, convenience, gas stations) [6][9][10] - Toast launched with Marriott, Hilton, Applebee's, Pop Belly, and Firehouse Subs [9] - Toast launched Zar New York City, showcasing complex retail operations powered by Toast [10] Business Focus & Priorities - Toast's core business includes software, hardware, payments, and services, with hardware being a smaller component [4] - Toast focuses on helping restaurants be more profitable and successful through solutions like handheld devices, commission-free e-commerce, and AI platforms [5][6] - Toast aims to more than double the opportunity in the US by expanding the total addressable market (TAM) globally [13] - Toast prioritizes vertical integration, focusing on specific sub-segments where the Toast platform can create real value for customers [8][11][12]

Core Insights - Toast (TOST) reported revenue of $1.55 billion for the quarter ended June 2025, reflecting a year-over-year increase of 24.8% and a surprise of +1.1% over the Zacks Consensus Estimate of $1.53 billion [1] - The company's EPS for the quarter was $0.24, compared to $0.02 in the same quarter last year, aligning with the consensus EPS estimate [1] Financial Performance Metrics - Gross Payment Volume (GPV) reached $49.90 billion, exceeding the four-analyst average estimate of $49.05 billion [4] - Subscription Annualized Recurring Run-Rate was $950 million, slightly above the average estimate of $945.59 million [4] - Total Annualized Recurring Run-Rate (ARR) stood at $1.93 billion, compared to the $1.9 billion average estimate [4] - Revenue from Financial Technology Solutions was $1.28 billion, surpassing the average estimate of $1.26 billion [4] - Revenue from Subscription Services was $227 million, compared to the average estimate of $221.09 million [4] - Revenue from Hardware and Professional Services was $47 million, below the average estimate of $51.74 million [4] Stock Performance - Toast's shares have returned +10% over the past month, outperforming the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Group 1: Earnings Performance - Toast reported quarterly earnings of $0.24 per share, matching the Zacks Consensus Estimate, and showing a significant increase from $0.02 per share a year ago [1] - The company posted revenues of $1.55 billion for the quarter ended June 2025, exceeding the Zacks Consensus Estimate by 1.10% and up from $1.24 billion year-over-year [2] - Over the last four quarters, Toast has surpassed consensus EPS estimates two times and revenue estimates three times [2][1] Group 2: Stock Performance and Outlook - Toast shares have increased approximately 35.3% since the beginning of the year, significantly outperforming the S&P 500's gain of 7.6% [3] - The future stock price movement will largely depend on management's commentary during the earnings call and the company's earnings outlook [4][3] - The current consensus EPS estimate for the upcoming quarter is $0.24 on revenues of $1.57 billion, and for the current fiscal year, it is $0.95 on revenues of $6.01 billion [7] Group 3: Industry Context - The Internet - Software industry, to which Toast belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Toast's stock performance [5]

Part I. Financial Information [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements show significant revenue growth and a shift to profitability, with improved cash flow from operations [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets grew to $2.77 billion, driven by increased cash, while stockholders' equity improved to $1.82 billion Balance Sheet Highlights (in millions) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $1,194 | $903 | +$291 | | Total current assets | $2,317 | $1,975 | +$342 | | Total assets | $2,767 | $2,408 | +$359 | | Total current liabilities | $894 | $811 | +$83 | | Total liabilities | $949 | $863 | +$86 | | Total stockholders' equity | $1,818 | $1,545 | +$273 | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a 25% year-over-year revenue increase for Q2 2025 and swung to a net income of $136 million for the six-month period Q2 2025 vs Q2 2024 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $1,550 | $1,242 | +25% | | Gross Profit | $392 | $286 | +37% | | Income from Operations | $80 | $5 | +1500% | | Net Income | $80 | $14 | +471% | | Diluted EPS | $0.13 | $0.02 | +550% | Six Months Ended June 30 Performance (in millions) | Metric | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $2,887 | $2,318 | +25% | | Gross Profit | $738 | $537 | +37% | | Income (Loss) from Operations | $123 | $(49) | N/A | | Net Income (Loss) | $136 | $(69) | N/A | | Diluted EPS | $0.23 | $(0.13) | N/A | [Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly increased to $302 million for the first six months of 2025 Cash Flow Summary - Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $302 | $104 | | Net cash (used in) investing activities | $(16) | $(33) | | Net cash provided by financing activities | $51 | $47 | | **Net increase in cash...** | **$340** | **$117** | [Notes to Condensed Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail revenue obligations, a share repurchase program, stock-based compensation, and purchase commitments - As of June 30, 2025, the company has approximately **$911 million of revenue** expected to be recognized from remaining performance obligations, with **$853 million expected in the next 24 months**[58](index=58&type=chunk) - Total stock-based compensation expense was **$120 million** for the six months ended June 30, 2025, a decrease from $133 million in the prior year period[61](index=61&type=chunk) - Under its share repurchase program, the company repurchased **$31 million in Class A common stock** during the first six months of 2025, with approximately **$163 million remaining authorized** for repurchase[67](index=67&type=chunk) - As of June 30, 2025, the company has non-cancellable purchase obligations of **$78 million to hardware suppliers** and **$146 million to cloud service providers** and other vendors[82](index=82&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong growth in customer locations and key metrics like GPV and ARR, leading to improved non-GAAP profitability [Key Business Metrics](index=27&type=section&id=Key%20Business%20Metrics) Key metrics like Gross Payment Volume (GPV) and Annualized Recurring Run-Rate (ARR) demonstrated robust double-digit year-over-year growth - As of June 30, 2025, Toast served approximately **148,000 locations**, representing a **24% year-over-year increase**[88](index=88&type=chunk) Key Metrics Performance | Metric | Q2 2025 | Q2 2024 | YoY Growth | | :--- | :--- | :--- | :--- | | Gross Payment Volume (GPV) | $49.9B | $40.5B | 23% | | **Metric** | **As of June 30, 2025** | **As of June 30, 2024** | **YoY Growth** | | Annualized Recurring Run-Rate (ARR) | $1,928M | $1,473M | 31% | [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Revenue growth of 25% in Q2 2025 was driven by subscription and financial technology solutions, outpacing cost increases - The increase in subscription services revenue was attributed to **growth in locations and higher product adoption**[98](index=98&type=chunk) - The increase in financial technology solutions revenue was attributed to the **increase in locations on the platform**[99](index=99&type=chunk) - Sales and marketing expenses for the six months ended June 30, 2025 increased by **$52 million (23%)** primarily due to higher employee-related costs and marketing expenses[102](index=102&type=chunk) [Non-GAAP Financial Measures](index=29&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP metrics showed significant improvement, with Adjusted EBITDA more than doubling and Free Cash Flow increasing substantially Adjusted EBITDA Reconciliation (in millions) | | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income (loss) | $136 | $(69) | | **Adjusted EBITDA** | **$294** | **$148** | Free Cash Flow Reconciliation (in millions) | | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $302 | $104 | | Capital expenditures | $(25) | $(29) | | **Free cash flow** | **$277** | **$75** | [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained a strong liquidity position of $2.05 billion and continued its share repurchase program - Total liquidity, including cash, marketable securities, and available credit, was **$2.05 billion** as of June 30, 2025[118](index=118&type=chunk) - In May 2025, the company amended its credit facility, increasing revolving commitments to **$350 million** and extending the term to 2030; no borrowings were outstanding as of June 30, 2025[124](index=124&type=chunk) - The total fully diluted share count as of June 30, 2025, was **630 million shares**, including 581 million shares issued and outstanding[126](index=126&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's exposure to market and credit risk has not materially changed since its 2024 Annual Report - There have been **no material changes** in the company's exposure to market risks, including interest rates, foreign currency exchange rates, and credit risk, since the end of fiscal year 2024[128](index=128&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2025[129](index=129&type=chunk) - **No changes occurred** during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[130](index=130&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) The company is not party to any litigation expected to have a material adverse effect on its business - Toast is not currently involved in any legal proceedings that are expected to have a **material adverse impact** on the company[133](index=133&type=chunk) [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred regarding the risk factors previously disclosed in the 2024 Annual Report - **No material changes** to the risk factors disclosed in the 2024 Form 10-K have occurred[134](index=134&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company details its Q2 2025 share repurchase activity under its publicly announced program Issuer Purchases of Equity Securities - Q2 2025 | Period | Total Shares Purchased (thousands) | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2025 | 409 | $32.33 | | May 2025 | — | — | | June 2025 | — | — | | **Total Q2** | **409** | **$32.33** | - As of the end of Q2 2025, approximately **$163 million remained available** for future repurchases under the authorized share repurchase program[136](index=136&type=chunk)