Toast (TOST) Q4 2024 earnings summary

Executive summary

• Achieved record addition of 28,000 net locations in 2024, reaching 134,000 total locations, and processed $160 billion in payment volume.

• Recurring gross profit streams grew 34% year-over-year; Adjusted EBITDA reached $373 million for 2024, with a 20 percentage point margin expansion and first full year of GAAP profitability (net income $19 million).

• Strategic priorities for 2025 include deepening U.S. restaurant market share, scaling new markets (enterprise, international, retail), increasing platform adoption, and expanding margins.

• Expanded partnerships and signed major enterprise agreements, including with Uber, Hilton Hotels, Marriott, Choice Hotels, and Ascent Hospitality.

• Expanded market share in core US restaurant segment and made significant progress in enterprise, international, and food & beverage retail markets.

Financial highlights

• Q4 2024 ARR reached $1.6 billion, up 34% year-over-year; SaaS ARR up 32% and SaaS ARPU up 5% year-over-year.

• Q4 Gross Payment Volume (GPV) rose 25% year-over-year to $42.2 billion; full year GPV up 26% to $159.1 billion.

• Q4 GAAP subscription and financial tech gross profit up 40% to $378 million; non-GAAP up 39% to $392 million.

• Adjusted EBITDA was $111 million in Q4, with margins expanding 18 percentage points year-over-year to 28%.

• Free cash flow totaled $134 million in Q4 and $306 million for the full year.

Outlook and guidance

• 2025 guidance: 23%-25% growth in recurring gross profit streams, with higher growth in the first half of the year.

• Full-year Adjusted EBITDA guidance of $510-$530 million, reflecting a 30% margin at the midpoint.

• Q1 2025 expected subscription and Fintech gross profit growth of 27%-30%, and Adjusted EBITDA of $100-$110 million.

• Free cash flow in 2025 anticipated to broadly mirror Adjusted EBITDA, with typical seasonality.

• Guidance reflects lapping of one-time ARR to revenue conversion benefits in 2024, which will not recur in 2025.