TOST Q4 2024 Earnings

Call Details

• Call Title: Toast, Inc. Class A Q4 2024 Earnings Call
• Date: February 19, 2025 at 10:00 PM UTC
• Management Team:
  • Michael Senno (Senior Vice President of Finance)
  • Aman Narang (CEO and Co-founder)
  • Elena Gomez (Chief Financial Officer)

Call Summary

Financial Performance

• Full year adjusted EBITDA was $373 million and the company posted its first full year of GAAP profitability.
• Recurring gross profit streams grew 34% year over year for the full year 2024 on a non-GAAP basis.
• The company added a record 28,000 net locations in 2024 and ended the year with approximately 134,000 total locations, which is up 26% year over year.
• Q4 recurring gross profit streams increased 39% year over year and Q4 adjusted EBITDA was $111 million with a 28% adjusted EBITDA margin.
• GTV for Q4 was $42 billion, up 25% year over year, and Q4 GTV per location was down 1% versus the prior year.
• Free cash flow was $134 million in Q4 and $306 million for the full year 2024.

Guidance

• For Q1 2025 the company expects total subscription and FinTech gross profit growth in the 27% to 30% range and adjusted EBITDA of $100 million to $110 million.
• For full year 2025 the company expects recurring gross profit stream growth of 23% to 25% and adjusted EBITDA of $510 million to $530 million, which implies a 30% margin at the midpoint.
• CFO stated the company anticipates higher growth in the first half of 2025 and a moderation in the second half due in part to one-time benefits in 2024 and ARR-to-revenue conversion dynamics.
• The company expects free cash flow in 2025 to broadly mirror adjusted EBITDA for the full year with typical seasonal patterns related to payments and bonus timing.
• The company will continue to make gradual, small pricing adjustments across SaaS and FinTech, and those changes are factored into the guidance.
• The company expects Toast Capital bad debt to grow as the program scales while Toast Capital contribution to take rate should remain in a similar range as 2024.