Ended 2023 with approximately 106,000 Locations; added over 6,500 net new Locations in fourth quarter
Annualized recurring run-rate (ARR) as of December 31, 2023 increased 35% to over $1.2 billion
Toast’s Board of Directors authorized a share repurchase program
Anticipate GAAP Operating Income profit by first half 2025
BOSTON--(BUSINESS WIRE)-- Toast (NYSE: TOST), the all-in-one digital technology platform built for restaurants, today reported financial results for the fourth quarter and full year ended December 31, 2023.
Financial Highlights for the Fourth Quarter of 2023
Financial Highlights for the Full Year 2023
For more information on the non-GAAP financial measures and key metrics discussed in this press release, please see the sections titled “Non-GAAP Financial Measures” and “Key Business Metrics,” as well as the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.
Outlook(1)
For the first quarter ending March 31, 2024, Toast expects to report:
For the full year ending December 31, 2024, Toast expects to report:
The outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. See cautionary note regarding “Forward-looking Statements” in this press release.
Beginning in fiscal year 2024, Toast is providing forward-looking guidance forNon-GAAP Subscription Services and Financial Technology Solutions Gross Profit which Toast considers its recurring gross profit streams. This is defined as subscription services gross profit (GAAP) and financial technology solutions gross profit (GAAP), adjusted to exclude stock-based compensation expense and related payroll tax expense, and depreciation and amortization expense, as set forth below (including historical comparison for reference):
| Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Gross profit (GAAP): |
|
|
|
|
|
|
| ||||
Subscription services | $ | 94 |
| $ | 63 |
| $ | 334 |
| $ | 212 |
Financial technology solutions |
| 176 |
|
| 137 |
|
| 686 |
|
| 476 |
Adjustments: |
|
|
|
|
|
|
| ||||
Stock-based compensation expense and related payroll tax |
| 5 |
|
| 4 |
|
| 20 |
|
| 13 |
Depreciation and amortization |
| 6 |
|
| 3 |
|
| 17 |
|
| 10 |
Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit (Non-GAAP) | $ | 281 |
| $ | 207 |
| $ | 1,057 |
| $ | 711 |
____________________ (1) A reconciliation of these forward looking Non-GAAP measures to the corresponding GAAP measure is not available without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliations that have not yet occurred, are out of our control, or cannot be reasonably predicted, including but not limited to the change in fair value of our warrant liability and stock-based compensation. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results. |
Company Restructuring
On February 13, 2024, Toast’s Board of Directors approved a restructuring plan (the “Plan”) designed to promote overall operating expense efficiency, including a reduction in force that is expected to impact approximately 550 employees, as well as certain other actions to reorganize the Company’s facilities and operations. The Company expects to complete the Plan by the end of fiscal year 2024. As part of this Plan, the Company expects to incur restructuring and restructuring-related charges of approximately $45 to $55 million, primarily related to severance and severance-related costs and certain other costs related to facilities. Substantially all of these charges are expected to be incurred in the first quarter of fiscal year 2024.
Share Repurchase Program
On February 13, 2024, Toast’s Board of Directors authorized a share repurchase program of up to $250 million of its Class A common stock. The Company intends to opportunistically repurchase shares based on market conditions, providing a way to return capital to stockholders and offset a portion of dilution associated with employee equity grants. The Company plans to repurchase shares through open market repurchases or Rule 10b5-1 plans. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities.
Recent Business Highlights
Conference Call Information
Toast will host a live conference call at 5:00 p.m. Eastern Time on Thursday, February 15, 2024. The live webcast of the conference call can be accessed through Toast’s investor relations website at http://investors.toasttab.com. A replay of the webcast will be available for a period of 90 days after the call.
Toast has used, and intends to continue to use, its Investor Relations website (http://investors.toasttab.com), as well as the Toast Newsroom (https://pos.toasttab.com/news), as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Information on or that can be accessed through Toast’s Investor Relations website, or that is contained in any website to which a hyperlink is provided herein is not part of this press release, and the inclusion of Toast’s Investor Relations website address, and any hyperlinks are only inactive textual references.
About Toast
Toast is a cloud-based, all-in-one digital technology platform purpose-built for the entire restaurant community. Toast provides a comprehensive platform of software as a service (SaaS) products and financial technology solutions that give restaurants everything they need to run their business across point of sale, payments, operations, digital ordering and delivery, marketing and loyalty, and team management. We serve as the restaurant operating system, connecting front of house and back of house operations across service models including dine-in, takeout, delivery, catering, and retail. Toast helps restaurants streamline operations, increase revenue and deliver amazing guest experiences. For more information, visit www.toasttab.com.
Forward-looking Statements
This press release contains “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the context of the statement and generally arise when Toast or its management is discussing its beliefs, estimates or expectations. Such statements generally include the words “believes,” “plans,” “intends,” “targets,” “may,” “could,” “should,” “will,” “expects,” “estimates,” “suggests,” “anticipates,” “outlook,” “continues,” or similar expressions. These statements are not historical facts or guarantees of future performance, but represent the beliefs of Toast and its management at the time the statements were made regarding future events which are subject to certain risks, uncertainties and other factors, many of which are outside Toast’s control. Actual results and outcomes may differ materially from what is expressed or forecast in such forward-looking statements. Forward-looking statements include, without limitation, statements about expected financial positions or growth; results of operations; cash flows; statements about expected timeline and plan to reach profitability on an GAAP operating income basis; guidance on financial results for the first fiscal quarter and full year of 2024; statements about future operating results; the expectations of demand for Toast’s products and growth of its business; the growth rates in the markets in which Toast competes; Toast’s investments in technology and infrastructure; statements regarding the arrangement between Toast and its customers, including the planned and future implementation of the Toast platform at such customers’ locations; Toast’s ability to deliver innovative solutions; Toast’s ability to attract and retain customers; financing plans; business strategy; operating plans; competitive positions; growth opportunities for existing products; statements regarding Toast’s share repurchase program; and statements regarding Toast’s restructuring plan.
The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in Toast’s filings with the Securities and Exchange Commission (“SEC”), including in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations'' in Toast’s Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2023 and Toast’s Annual Report on Form 10-K for the year ended December 31, 2023, that will be filed following this earnings release, and Toast’s subsequent SEC filings. Toast can give no assurance that the plans, intentions, expectations or strategies as reflected in or suggested by those forward-looking statements will be attained or achieved. The forward-looking statements in this release are based on information available to Toast as of the date hereof, and Toast disclaims any obligation to update any forward-looking statements, except as required by law. These forward-looking statements should not be relied upon as representing Toast’s views as of any date subsequent to the date of this press release.
TOAST, INC.CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in millions, except per share amounts)
| Three Months Ended December 31, |
| Year Ended December 31, | ||||||||||||
|
| 2023 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2022 |
|
Revenue: |
|
|
|
|
|
|
| ||||||||
Subscription services | $ | 142 |
|
| $ | 95 |
|
| $ | 500 |
|
| $ | 324 |
|
Financial technology solutions |
| 851 |
|
|
| 640 |
|
|
| 3,189 |
|
|
| 2,268 |
|
Hardware and professional services |
| 43 |
|
|
| 34 |
|
|
| 176 |
|
|
| 139 |
|
Total revenue |
| 1,036 |
|
|
| 769 |
|
|
| 3,865 |
|
|
| 2,731 |
|
Costs of revenue: |
|
|
|
|
|
|
| ||||||||
Subscription services |
| 48 |
|
|
| 32 |
|
|
| 166 |
|
|
| 112 |
|
Financial technology solutions |
| 675 |
|
|
| 503 |
|
|
| 2,503 |
|
|
| 1,792 |
|
Hardware and professional services |
| 86 |
|
|
| 75 |
|
|
| 357 |
|
|
| 311 |
|
Amortization of acquired intangible assets |
| 1 |
|
|
| 1 |
|
|
| 5 |
|
|
| 5 |
|
Total costs of revenue |
| 810 |
|
|
| 611 |
|
|
| 3,031 |
|
|
| 2,220 |
|
Gross profit |
| 226 |
|
|
| 158 |
|
|
| 834 |
|
|
| 511 |
|
Operating expenses: |
|
|
|
|
|
|
| ||||||||
Sales and marketing |
| 102 |
|
|
| 87 |
|
|
| 401 |
|
|
| 319 |
|
Research and development |
| 94 |
|
|
| 79 |
|
|
| 358 |
|
|
| 282 |
|
General and administrative |
| 86 |
|
|
| 91 |
|
|
| 362 |
|
|
| 294 |
|
Total operating expenses |
| 282 |
|
|
| 257 |
|
|
| 1,121 |
|
|
| 895 |
|
Loss from operations |
| (56 | ) |
|
| (99 | ) |
|
| (287 | ) |
|
| (384 | ) |
Other income (expense): |
|
|
|
|
|
|
| ||||||||
Interest income, net |
| 10 |
|
|
| 6 |
|
|
| 37 |
|
|
| 11 |
|
Change in fair value of warrant liability |
| 8 |
|
|
| (7 | ) |
|
| 3 |
|
|
| 95 |
|
Other income, net |
| 3 |
|
|
| 3 |
|
|
| 3 |
|
|
| 1 |
|
Loss before income taxes |
| (35 | ) |
|
| (97 | ) |
|
| (244 | ) |
|
| (277 | ) |
Income tax (expense) benefit |
| (1 | ) |
|
| (2 | ) |
|
| (2 | ) |
|
| 2 |
|
Net loss | $ | (36 | ) |
| $ | (99 | ) |
| $ | (246 | ) |
| $ | (275 | ) |
Net loss per share attributable to common stockholders: |
|
|
|
|
|
|
| ||||||||
Basic | $ | (0.07 | ) |
| $ | (0.19 | ) |
| $ | (0.46 | ) |
| $ | (0.54 | ) |
Diluted | $ | (0.07 | ) |
| $ | (0.19 | ) |
| $ | (0.47 | ) |
| $ | (0.72 | ) |
Weighted average shares used in computing net loss per share: |
|
|
|
|
|
|
| ||||||||
Basic |
| 541 |
|
|
| 519 |
|
|
| 532 |
|
|
| 512 |
|
Diluted |
| 541 |
|
|
| 519 |
|
|
| 533 |
|
|
| 512 |
|
TOAST, INC.CONSOLIDATED BALANCE SHEETS (unaudited) (in millions, except per share amounts)
| December 31, | ||||||
|
| 2023 |
|
|
| 2022 |
|
Assets: |
|
|
| ||||
Current assets: |
|
|
| ||||
Cash and cash equivalents | $ | 605 |
|
| $ | 547 |
|
Marketable securities |
| 519 |
|
|
| 474 |
|
Accounts receivable, net |
| 69 |
|
|
| 77 |
|
Inventories, net |
| 118 |
|
|
| 110 |
|
Other current assets |
| 259 |
|
|
| 199 |
|
Total current assets |
| 1,570 |
|
|
| 1,407 |
|
Property and equipment, net |
| 75 |
|
|
| 61 |
|
Operating lease right-of-use assets |
| 36 |
|
|
| 77 |
|
Intangible assets, net |
| 26 |
|
|
| 29 |
|
Goodwill |
| 113 |
|
|
| 107 |
|
Restricted cash |
| 55 |
|
|
| 28 |
|
Other non-current assets |
| 83 |
|
|
| 52 |
|
Total non-current assets |
| 388 |
|
|
| 354 |
|
Total assets | $ | 1,958 |
|
| $ | 1,761 |
|
Liabilities and Stockholders’ Equity: |
|
|
| ||||
Current liabilities: |
|
|
| ||||
Accounts payable | $ | 32 |
|
| $ | 30 |
|
Deferred revenue |
| 39 |
|
|
| 39 |
|
Accrued expenses and other current liabilities |
| 592 |
|
|
| 427 |
|
Total current liabilities |
| 663 |
|
|
| 496 |
|
Warrants to purchase common stock |
| 64 |
|
|
| 68 |
|
Operating lease liabilities, non-current |
| 33 |
|
|
| 80 |
|
Other long-term liabilities |
| 4 |
|
|
| 19 |
|
Total liabilities |
| 764 |
|
|
| 663 |
|
Commitments and Contingencies |
|
|
| ||||
Stockholders’ Equity: |
|
|
| ||||
Preferred stock - par value $0.000001; 100 million shares authorized, no shares issued or outstanding |
| — |
|
|
| — |
|
Common stock, $0.000001 par value: Class A - 7,000 shares authorized, 429 and 353 shares issued and outstanding as of December 31, 2023 and 2022, respectively; Class B - 700 shares authorized, 114 and 170 shares issued and outstanding as of December 31, 2023 and 2022, respectively |
| — |
|
|
| — |
|
Treasury stock, at cost - no shares and 0 shares outstanding at December 31, 2023 and 2022, respectively |
| — |
|
|
| — |
|
Accumulated other comprehensive loss |
| — |
|
|
| (2 | ) |
Additional paid-in capital |
| 2,817 |
|
|
| 2,477 |
|
Accumulated deficit |
| (1,623 | ) |
|
| (1,377 | ) |
Total stockholders’ equity |
| 1,194 |
|
|
| 1,098 |
|
Total liabilities and stockholders’ equity | $ | 1,958 |
|
| $ | 1,761 |
|
TOAST, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in millions)
| Three Months Ended December 31, |
| Year Ended December 31, | ||||||||||||
|
| 2023 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2022 |
|
Cash flows from operating activities: |
|
|
|
|
|
|
| ||||||||
Net loss | $ | (36 | ) |
| $ | (99 | ) |
| $ | (246 | ) |
| $ | (275 | ) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
| ||||||||
Depreciation and amortization |
| 10 |
|
|
| 6 |
|
|
| 32 |
|
|
| 24 |
|
Stock-based compensation expense |
| 71 |
|
|
| 61 |
|
|
| 277 |
|
|
| 228 |
|
Amortization of deferred contract acquisition costs |
| 18 |
|
|
| 12 |
|
|
| 62 |
|
|
| 44 |
|
Change in fair value of warrant liability |
| (8 | ) |
|
| 7 |
|
|
| (3 | ) |
|
| (95 | ) |
Credit loss expense |
| 20 |
|
|
| 16 |
|
|
| 64 |
|
|
| 34 |
|
Stock-based charitable contribution expense |
| — |
|
|
| 10 |
|
|
| 10 |
|
|
| 10 |
|
Asset impairments |
| — |
|
|
| — |
|
|
| 15 |
|
|
| — |
|
Other non-cash items |
| (3 | ) |
|
| 2 |
|
|
| (17 | ) |
|
| 3 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
| ||||||||
Accounts receivable, net |
| 21 |
|
|
| (5 | ) |
|
| (3 | ) |
|
| (35 | ) |
Other current assets |
| (5 | ) |
|
| (19 | ) |
|
| (12 | ) |
|
| (36 | ) |
Deferred contract acquisition costs |
| (30 | ) |
|
| (18 | ) |
|
| (107 | ) |
|
| (71 | ) |
Inventories, net |
| (20 | ) |
|
| (15 | ) |
|
| (7 | ) |
|
| (68 | ) |
Accounts payable |
| 4 |
|
|
| 1 |
|
|
| 1 |
|
|
| (11 | ) |
Accrued expenses and other current liabilities |
| 64 |
|
|
| 25 |
|
|
| 81 |
|
|
| 116 |
|
Deferred revenue |
| (11 | ) |
|
| (2 | ) |
|
| (5 | ) |
|
| (11 | ) |
Operating lease right-of-use assets and operating lease liabilities, net |
| 1 |
|
|
| — |
|
|
| 1 |
|
|
| — |
|
Other assets and liabilities |
| (4 | ) |
|
| (1 | ) |
|
| (8 | ) |
|
| (13 | ) |
Net cash provided by (used in) operating activities |
| 92 |
|
|
| (19 | ) |
|
| 135 |
|
|
| (156 | ) |
Cash flows from investing activities: |
|
|
|
|
|
|
| ||||||||
Cash paid for acquisition, net of cash acquired |
| — |
|
|
| — |
|
|
| (9 | ) |
|
| (46 | ) |
Capital expenditures |
| (11 | ) |
|
| (10 | ) |
|
| (42 | ) |
|
| (33 | ) |
Purchases of marketable securities |
| (144 | ) |
|
| (247 | ) |
|
| (623 | ) |
|
| (434 | ) |
Proceeds from the sale of marketable securities |
| 12 |
|
|
| 5 |
|
|
| 35 |
|
|
| 46 |
|
Maturities of marketable securities |
| 142 |
|
|
| 179 |
|
|
| 556 |
|
|
| 369 |
|
Other |
| — |
|
|
| — |
|
|
| (3 | ) |
|
| — |
|
Net cash used in investing activities |
| (1 | ) |
|
| (73 | ) |
|
| (86 | ) |
|
| (98 | ) |
Cash flows from financing activities: |
|
|
|
|
|
|
| ||||||||
Proceeds from issuance of common stock |
| 5 |
|
|
| 3 |
|
|
| 36 |
|
|
| 15 |
|
Change in customer funds obligations, net |
| — |
|
|
| — |
|
|
| 27 |
|
|
| 26 |
|
Other financing activities |
| — |
|
|
| (1 | ) |
|
| — |
|
|
| (3 | ) |
Net cash provided by financing activities |
| 5 |
|
|
| 2 |
|
|
| 63 |
|
|
| 38 |
|
Net increase (decrease) in cash, cash equivalents, cash held on behalf of customers and restricted cash |
| 96 |
|
|
| (90 | ) |
|
| 112 |
|
|
| (216 | ) |
Effect of exchange rate changes on cash and cash equivalents and restricted cash |
| 1 |
|
|
| 1 |
|
|
| — |
|
|
| — |
|
Cash, cash equivalents, cash held on behalf of customers and restricted cash at beginning of period |
| 650 |
|
|
| 724 |
|
|
| 635 |
|
|
| 851 |
|
Cash, cash equivalents, cash held on behalf of customers and restricted cash at end of period | $ | 747 |
|
| $ | 635 |
|
| $ | 747 |
|
| $ | 635 |
|
Reconciliation of cash, cash equivalents, cash held on behalf of customers and restricted cash |
|
|
|
|
|
|
| ||||||||
Cash and cash equivalents | $ | 605 |
|
| $ | 547 |
|
| $ | 605 |
|
| $ | 547 |
|
Cash held on behalf of customers |
| 87 |
|
|
| 60 |
|
|
| 87 |
|
|
| 60 |
|
Restricted cash |
| 55 |
|
|
| 28 |
|
|
| 55 |
|
|
| 28 |
|
Total cash, cash equivalents, cash held on behalf of customers and restricted cash | $ | 747 |
|
| $ | 635 |
|
| $ | 747 |
|
| $ | 635 |
|
Non-GAAP Financial Measures
In this press release, Toast refers to non-GAAP financial measures that are derived on the basis of methodologies other than in accordance with United States generally accepted accounting principles (“GAAP”). Toast uses certain non-GAAP financial measures, as described below, to understand and evaluate its core operating performance. These non-GAAP financial measures, which may be different than similarly-titled measures used by other companies, are presented to enhance investors’ overall understanding of Toast’s financial performance and should not be considered substitutes for, or superior to, the financial information prepared and presented in accordance with GAAP. Toast believes that these non-GAAP financial measures provide useful information about its financial performance, enhance the overall understanding of its past performance and future prospects, and allow for greater transparency with respect to important metrics used by Toast’s management for financial and operational decision-making.
In the tables below, Toast has provided reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP. These non-GAAP financial measures should not be considered substitutes for financial measures calculated in accordance with GAAP, and the financial results that Toast calculates and presents in the table in accordance with GAAP, as well as the corresponding reconciliations from those results, should be carefully evaluated.
The following are the non-GAAP financial measures referenced in this press release and presented in the tables below:
Adjusted EBITDA, Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit, Non-GAAP Costs of Revenue, Non-GAAP Gross Profit, Non-GAAP Subscription Services Gross Profit, Non-GAAP Financial Technology Gross Profit, Non-GAAP Hardware and Professional Services Gross Profit, Non-GAAP Non-Payments Financial Technology Solutions Gross Profit, Non-GAAP Sales and Marketing Expenses, Non-GAAP Research and Development Expenses, Non-GAAP General and Administrative Expenses, and Free Cash Flow do not purport to represent profitability and liquidity measures as defined in accordance with GAAP. These measures are provided to investors and others to improve the quarter-to-quarter and year-to-year comparability of Toast's financial results and to ensure that investors understand the information Toast uses to evaluate the performance of its businesses.
Our definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Further, these metrics have certain limitations since they do not include the impact of certain expenses and cash flows that are reflected in our Consolidated Statements of Operations and Consolidated Statements of Cash Flows. Thus, our Adjusted EBITDA, Non-GAAP Subscription Services and Financial Technology Solutions Gross Profit, Non-GAAP Costs of Revenue, Non-GAAP Gross Profit, Non-GAAP Subscription Services Gross Profit, Non-GAAP Financial Technology Gross Profit, Non-GAAP Hardware and Professional Services Gross Profit, Non-GAAP Non-Payments Financial Technology Solutions Gross Profit, Non-GAAP Sales and Marketing Expenses, Non-GAAP Research and Development Expenses, Non-GAAP General and Administrative Expenses, and Free Cash Flow should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.
Key Business Metrics
In addition, Toast also uses the following key business metrics to help it evaluate its business, identify trends affecting its business, formulate business plans, and make strategic decisions:
Locations
We define a live location, or Location, as a unique location that has used Toast Point of Sale to record transaction volumes above a minimum threshold, and has not been marked as a churned location as of the date of determination. A Location can use Toast payment services, which we refer to as a Toast Processing Location, or for select enterprise customers, not use Toast’s payment services, which we refer to as a Non-Toast Processing Location. Customers of legacy solutions provided by companies that we have acquired, that do not use Toast Point of Sale, are not included in our Location count.
Key Business Metrics and Reconciliation of Non-GAAP Results (unaudited)
| Three Months Ended December 31, |
|
|
| Year Ended December 31, |
|
| ||||||||||
(dollars in billions) |
| 2023 |
|
| 2022 |
| % Growth |
|
| 2023 |
|
| 2022 |
| % Growth | ||
Gross Payment Volume (GPV) | $ | 33.7 |
| $ | 25.5 |
| 32 | % |
| $ | 126.1 |
| $ | 91.7 |
| 38 | % |
|
|
|
|
| As of December 31, |
|
| |||||||
(dollars in millions) |
|
|
|
|
|
|
| 2023 |
|
| 2022 |
| % Growth | |
Payments Annualized Recurring Run-Rate |
| $ | 589 |
| $ | 460 |
| 28 | % | |||||
Subscription Annualized Recurring Run-Rate |
| $ | 629 |
| $ | 441 |
| 43 | % | |||||
Total Annualized Recurring Run-Rate (ARR) | $ | 1,218 |
| $ | 901 |
| 35 | % | ||||||
Adjusted EBITDA | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||||||
(dollars in millions) |
| 2023 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2022 |
|
Net loss | $ | (36 | ) |
| $ | (99 | ) |
| $ | (246 | ) |
| $ | (275 | ) |
Stock-based compensation expense and related payroll tax |
| 72 |
|
|
| 62 |
|
|
| 288 |
|
|
| 232 |
|
Depreciation and amortization |
| 10 |
|
|
| 6 |
|
|
| 32 |
|
|
| 24 |
|
Interest income, net |
| (10 | ) |
|
| (6 | ) |
|
| (37 | ) |
|
| (11 | ) |
Change in fair value of warrant liability |
| (8 | ) |
|
| 7 |
|
|
| (3 | ) |
|
| (95 | ) |
Termination of leases |
| — |
|
|
| — |
|
|
| 14 |
|
|
| (1 | ) |
Stock-based charitable contribution expense |
| — |
|
|
| 10 |
|
|
| 10 |
|
|
| 10 |
|
Acquisition expenses |
| — |
|
|
| — |
|
|
| 1 |
|
|
| 2 |
|
Other expense, net |
| — |
|
|
| — |
|
|
| — |
|
|
| 1 |
|
Income tax expense (benefit) |
| 1 |
|
|
| 2 |
|
|
| 2 |
|
|
| (2 | ) |
Adjusted EBITDA | $ | 29 |
|
| $ | (18 | ) |
| $ | 61 |
|
| $ | (115 | ) |
Non-GAAP Costs of Revenue | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Costs of revenue | $ | 810 |
| $ | 611 |
| $ | 3,031 |
| $ | 2,220 |
Stock-based compensation expense and related payroll tax |
| 12 |
|
| 10 |
|
| 46 |
|
| 35 |
Depreciation and amortization |
| 7 |
|
| 4 |
|
| 23 |
|
| 16 |
Non-GAAP costs of revenue | $ | 791 |
| $ | 597 |
| $ | 2,962 |
| $ | 2,169 |
Non-GAAP Gross Profit | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Gross profit | $ | 226 |
| $ | 158 |
| $ | 834 |
| $ | 511 |
Stock-based compensation expense and related payroll tax |
| 12 |
|
| 10 |
|
| 46 |
|
| 35 |
Depreciation and amortization |
| 7 |
|
| 4 |
|
| 23 |
|
| 16 |
Non-GAAP gross profit | $ | 245 |
| $ | 172 |
| $ | 903 |
| $ | 562 |
Non-GAAP Subscription Services Gross Profit | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Subscription services gross profit | $ | 94 |
| $ | 63 |
| $ | 334 |
| $ | 212 |
Stock-based compensation expense and related payroll tax |
| 5 |
|
| 4 |
|
| 20 |
|
| 13 |
Depreciation and amortization |
| 6 |
|
| 3 |
|
| 17 |
|
| 10 |
Non-GAAP subscription services gross profit | $ | 105 |
| $ | 70 |
| $ | 371 |
| $ | 235 |
Non-GAAP Financial Technology Solutions Gross Profit | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Financial technology solutions gross profit | $ | 176 |
| $ | 137 |
| $ | 686 |
| $ | 476 |
Stock-based compensation expense and related payroll tax |
| — |
|
| — |
|
| — |
|
| — |
Depreciation and amortization |
| — |
|
| — |
|
| — |
|
| — |
Non-GAAP financial technology solutions gross profit | $ | 176 |
| $ | 137 |
| $ | 686 |
| $ | 476 |
Non-GAAP Hardware and Professional Services Gross Profit | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||||||
(dollars in millions) |
| 2023 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2022 |
|
Hardware and professional services gross profit | $ | (43 | ) |
| $ | (41 | ) |
| $ | (181 | ) |
| $ | (172 | ) |
Stock-based compensation expense and related payroll tax |
| 7 |
|
|
| 6 |
|
|
| 26 |
|
|
| 22 |
|
Depreciation and amortization |
| — |
|
|
| — |
|
|
| 1 |
|
|
| 1 |
|
Non-GAAP hardware and professional services gross profit | $ | (36 | ) |
| $ | (35 | ) |
| $ | (154 | ) |
| $ | (149 | ) |
Non-GAAP Non-Payments Financial Technology Solutions Gross Profit | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Financial technology solutions gross profit | $ | 176 |
| $ | 137 |
| $ | 686 |
| $ | 476 |
Payments financial technology solutions gross profit |
| 142 |
|
| 113 |
|
| 561 |
|
| 418 |
Non-GAAP non-payments financial technology solutions gross profit | $ | 34 |
| $ | 24 |
| $ | 125 |
| $ | 58 |
Non-GAAP Sales and Marketing Expenses | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Sales and marketing expenses | $ | 102 |
| $ | 87 |
| $ | 401 |
| $ | 319 |
Stock-based compensation expense and related payroll tax |
| 15 |
|
| 13 |
|
| 61 |
|
| 51 |
Depreciation and amortization |
| 1 |
|
| 1 |
|
| 3 |
|
| 3 |
Non-GAAP sales and marketing expenses | $ | 86 |
| $ | 73 |
| $ | 337 |
| $ | 265 |
Non-GAAP Research and Development Expenses | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
Research and development expenses | $ | 94 |
| $ | 79 |
| $ | 358 |
| $ | 282 |
Stock-based compensation expense and related payroll tax |
| 25 |
|
| 20 |
|
| 97 |
|
| 73 |
Depreciation and amortization |
| 1 |
|
| 1 |
|
| 4 |
|
| 2 |
Non-GAAP research and development expenses | $ | 68 |
| $ | 58 |
| $ | 257 |
| $ | 207 |
Non-GAAP General and Administrative Expenses | Three Months Ended December 31, |
| Year Ended December 31, | |||||||||
(dollars in millions) |
| 2023 |
|
| 2022 |
|
| 2023 |
|
| 2022 |
|
General and administrative expenses | $ | 86 |
| $ | 91 |
| $ | 362 |
| $ | 294 |
|
Stock-based compensation expense and related payroll tax |
| 20 |
|
| 19 |
|
| 84 |
|
| 74 |
|
Depreciation and amortization |
| 1 |
|
| 1 |
|
| 2 |
|
| 2 |
|
Acquisition expenses |
| — |
|
| — |
|
| 1 |
|
| 2 |
|
Termination of leases |
| — |
|
| — |
|
| 14 |
|
| (2 | ) |
Stock-based charitable contribution expense |
| — |
|
| 10 |
|
| 10 |
|
| 10 |
|
Non-GAAP general and administrative expenses | $ | 65 |
| $ | 61 |
| $ | 251 |
| $ | 208 |
|
Free Cash Flow | Three Months Ended December 31, |
| Year Ended December 31, | ||||||||||||
(dollars in millions) |
| 2023 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2022 |
|
Net cash provided by (used in) operating activities | $ | 92 |
|
| $ | (19 | ) |
| $ | 135 |
|
| $ | (156 | ) |
Capital expenditures |
| (11 | ) |
|
| (10 | ) |
|
| (42 | ) |
|
| (33 | ) |
Free cash flow | $ | 81 |
|
| $ | (29 | ) |
| $ | 93 |
|
| $ | (189 | ) |
Sums may not equal totals due to rounding.
TOST-FIN
View source version on businesswire.com: https://www.businesswire.com/news/home/20240215835490/en/
Media: media@toasttab.com Investors: IR@toasttab.com
Source: Toast, Inc.