Toast (TOST) investor relations material

Executive summary

• Q2 2026 delivered strong results with recurring gross profit up 28%, GAAP operating income margin at 26%, and revenue growing 23% year-over-year, driven by financial technology solutions and subscription services.

• Net income for Q2 2026 was $154 million, nearly doubling year-over-year, with adjusted EBITDA at $221 million, reflecting improved operating leverage.

• Record 9,500 net new locations added, growing total locations 22% year-over-year to approximately 180,000.

• AI-driven products, especially Toast IQ Grow, are scaling rapidly and driving new ARR.

• The company repurchased 19 million shares for $486 million year-to-date, with $100 million remaining authorized.

Financial highlights

• ARR grew 25% year-over-year to $2.4 billion; recurring gross profit streams increased 28%.

• Total revenue for Q2 2026 was $1,908 million, up from $1,550 million in Q2 2025.

• Adjusted EBITDA reached $221 million, up 38%, with margins expanding to 37%.

• Free cash flow was $130 million in Q2 2026, down year-over-year due to strategic hardware inventory build.

• GPV was $60.7 billion, up 22% year-over-year.

Outlook and guidance

• Q3 2026: Subscription and fintech gross profit expected to grow 22%-24% year-over-year; adjusted EBITDA guidance of $210-$220 million.

• Full-year 2026: Recurring gross profit growth outlook raised to 23%-25%; adjusted EBITDA guidance increased to $805-$825 million.

• Management expects financial technology solutions revenue to remain a significant portion of the revenue mix, with seasonality impacting results.