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Toast's enterprise deals and digital ordering may spur growth, but rising AI and sales costs may ail.
Toast, Inc. (TOST - Free Report) is set to report its third-quarter 2026 results on Nov. 3, after market close. The company’s quarterly results are likely to reflect year-over-year growth in both revenues and earnings.
In the last reported quarter, Toast reported earnings of 34 cents per share, beating the Zacks Consensus Estimate of 32 cents. Revenues rose 23.1% year over year to $1.91 billion and outpaced the consensus mark by $35.08 million, a 1.9% surprise. Growth was led by subscription and financial technology solutions, supported by a larger location base and continued product adoption.
Over the preceding four quarters, TOST’s earnings per share surpassed the Zacks Consensus Estimate on three occasions and missed in the remaining period, the average beat being 2.46%. The graph below depicts this surprising history:
Let’s see how things have shaped up for TOST before the announcement.
Toast is expected to have benefited from a growing customer base during the third quarter of 2026. Following 9,500 net location additions in the second quarter, continued onboarding is likely to have supported subscription revenues and payment activity.
Gross payment volume (GPV) may have increased, supported by new locations and transaction growth. Higher adoption of software and financial technology solutions is likely to have boosted recurring gross profit, although uneven restaurant spending could have tempered growth.
Enterprise adoption was another potential driver. BWH Hotels endorsed Toast as a POS provider in August, while Kung Fu Tea agreed to implement its technology across more than 330 locations. However, gradual installations may have limited quarterly contributions.
Toast's Google Maps ordering integration may have supported digital transactions. Meanwhile, Toast Fuel expanded its convenience-store capabilities in late September, although its contribution to quarterly results was likely minimal.
Higher spending on sales, AI development and new markets is likely to have weighed on margins, partly offsetting operating leverage. Management projected third-quarter non-GAAP subscription services and financial technology solutions gross profit of $615-$625 million, representing 22%-24% annual growth, and adjusted EBITDA of $210-$220 million.
Q3 Projections for TOST
The Zacks Consensus Estimate for Toast’s subscription services revenues is pegged at $305.6 million, which suggests a 25.2% increase from the year-ago quarter.
The consensus mark for revenues from financial technology solutions is pegged at $1.61 billion for the third quarter, up 19.9% from the year-ago period.
The consensus mark for GPV is pegged at $61.94 billion, which is above the company’s reported figure of $51.50 billion in the year-ago quarter. The consensus mark for the total ARR is pegged at $2.50 billion, up from the year-ago figure of $2.02 billion.
The consensus mark for total locations served stands at 187,891, up from 156,000 reported a year ago.
However, the Zacks Consensus Estimate for hardware and professional services is pegged at $44.51 billion, indicating just a slight increase from $44 million reported a year ago.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $1.96 billion, calling for a jump of 20.3% from the year-ago quarter’s reported figure.
The consensus mark for earnings per share (EPS) stands at 37 cents and has remained unchanged over the past two months. It indicates a rise of 48% from the figure reported in the year-ago quarter.
Here’s What Our Quantitative Model Predicts for TOST
However, our proprietary model does not conclusively predict an earnings beat for Toast this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.
Toast currently has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies — Block, Inc. (XYZ - Free Report) and StoneCo Ltd. (STNE - Free Report) — worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
View the Zacks #1 Rank List
Image: Bigstock
Toast to Report Q3 Earnings: What to Expect From Its Release?
Key Takeaways
Toast, Inc. (TOST - Free Report) is set to report its third-quarter 2026 results on Nov. 3, after market close. The company’s quarterly results are likely to reflect year-over-year growth in both revenues and earnings.
In the last reported quarter, Toast reported earnings of 34 cents per share, beating the Zacks Consensus Estimate of 32 cents. Revenues rose 23.1% year over year to $1.91 billion and outpaced the consensus mark by $35.08 million, a 1.9% surprise. Growth was led by subscription and financial technology solutions, supported by a larger location base and continued product adoption.
Over the preceding four quarters, TOST’s earnings per share surpassed the Zacks Consensus Estimate on three occasions and missed in the remaining period, the average beat being 2.46%. The graph below depicts this surprising history:
Let’s see how things have shaped up for TOST before the announcement.
Toast, Inc. Price and EPS Surprise
Toast, Inc. price-eps-surprise | Toast, Inc. Quote
Key Factors to Watch Ahead of TOST’s Q3 Results
Toast is expected to have benefited from a growing customer base during the third quarter of 2026. Following 9,500 net location additions in the second quarter, continued onboarding is likely to have supported subscription revenues and payment activity.
Gross payment volume (GPV) may have increased, supported by new locations and transaction growth. Higher adoption of software and financial technology solutions is likely to have boosted recurring gross profit, although uneven restaurant spending could have tempered growth.
Enterprise adoption was another potential driver. BWH Hotels endorsed Toast as a POS provider in August, while Kung Fu Tea agreed to implement its technology across more than 330 locations. However, gradual installations may have limited quarterly contributions.
Toast's Google Maps ordering integration may have supported digital transactions. Meanwhile, Toast Fuel expanded its convenience-store capabilities in late September, although its contribution to quarterly results was likely minimal.
Higher spending on sales, AI development and new markets is likely to have weighed on margins, partly offsetting operating leverage. Management projected third-quarter non-GAAP subscription services and financial technology solutions gross profit of $615-$625 million, representing 22%-24% annual growth, and adjusted EBITDA of $210-$220 million.
Q3 Projections for TOST
The Zacks Consensus Estimate for Toast’s subscription services revenues is pegged at $305.6 million, which suggests a 25.2% increase from the year-ago quarter.
The consensus mark for revenues from financial technology solutions is pegged at $1.61 billion for the third quarter, up 19.9% from the year-ago period.
The consensus mark for GPV is pegged at $61.94 billion, which is above the company’s reported figure of $51.50 billion in the year-ago quarter. The consensus mark for the total ARR is pegged at $2.50 billion, up from the year-ago figure of $2.02 billion.
The consensus mark for total locations served stands at 187,891, up from 156,000 reported a year ago.
However, the Zacks Consensus Estimate for hardware and professional services is pegged at $44.51 billion, indicating just a slight increase from $44 million reported a year ago.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $1.96 billion, calling for a jump of 20.3% from the year-ago quarter’s reported figure.
The consensus mark for earnings per share (EPS) stands at 37 cents and has remained unchanged over the past two months. It indicates a rise of 48% from the figure reported in the year-ago quarter.
Here’s What Our Quantitative Model Predicts for TOST
However, our proprietary model does not conclusively predict an earnings beat for Toast this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.
Toast currently has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies — Block, Inc. (XYZ - Free Report) and StoneCo Ltd. (STNE - Free Report) — worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Block currently has an Earnings ESP of +1.67% and a Zacks Rank #3. Block is set to report third-quarter 2026 results on Nov. 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
StoneCo currently has an Earnings ESP of +2.74% and a Zacks Rank #3. STNE is slated to report third-quarter 2026 results on Nov. 12.