New York, February 13, 2026, 16:30 EST — After-hours
Toast shares rose about 5% in after-hours trading on Friday, steadying after a choppy day as investors digested the restaurant software and payments company’s quarterly update and a larger buyback. The stock was up 4.6% at $27.33, after trading between $24.41 and $28.48; Block slipped about 1% and Lightspeed fell about 5%.
The update matters now because Toast is trying to keep its growth story intact while showing it can throw off cash and expand profit. Toast forecast 2026 adjusted EBITDA — a profit measure that strips out items such as interest, taxes and some non-cash costs — of $775 million to $795 million, and 20% to 22% growth in what it calls “recurring gross profit streams,” mainly subscription and payments gross profit on a non-GAAP basis. (SEC)
Analysts are not reading the same playbook. Needham cut its price target to $35 from $60 while keeping a buy rating, pointing to “multiple compression” across software and payments, while Bernstein’s Harshita Rawat reiterated an Outperform and a $39 target, calling Toast “one of the highest quality names” in payments even after what she described as a sharp year-to-date slide. (Investing)
Toast’s fourth-quarter profit rose to $101 million, or $0.16 per share, from $33 million, or $0.05, a year earlier. Revenue climbed 22.6% to $1.63 billion, the company said. (Nasdaq)
In prepared remarks for the earnings call, CFO Elena Gomez said the 2026 outlook bakes in about 150 basis points of margin pressure — roughly 1.5 percentage points — from higher memory chip costs for hardware, alongside higher tariff costs. She said the cost squeeze should land more heavily in the second half of 2026 as higher-cost parts flow through inventory, and noted the first quarter is typically lighter for net adds and payment volume than later quarters. (Q4 Inc.)
A regulatory filing showed Toast’s board approved a $500 million increase to its share repurchase program on Feb. 10. The program has no expiration date, and the company said it may use 10b5-1 plans — pre-scheduled trading plans — to help execute buybacks. (SEC)
On the earnings call, management highlighted 30,000 net location additions in 2025, ending the year at about 164,000 locations, with annualized recurring run-rate above $2 billion and full-year gross payment volume around $195 billion. Executives also pointed to growing use of Toast IQ, its in-product assistant, as it pushes into newer markets. (The Motley Fool)
Toast sells a cloud-based platform built for restaurants, bundling point-of-sale software with payments and tools for ordering, marketing and team management. The company has been expanding into formats that blur restaurants and retail, where operators want inventory and checkout in the same system. (Toast Investor Relations)
The competitive set is crowded. Toast runs into Block’s Square, Fiserv’s Clover and smaller restaurant-focused players, where price, hardware costs and support can matter as much as software features.
But the upside case still has moving parts. A pullback in restaurant traffic can hit payment volumes, and the hardware-cost headwinds flagged by management could last longer than expected if component and tariff pressures don’t ease.
The next hard catalyst is the March 31 quarter and whatever Toast says about net location additions and margins as 2026 starts to unfold. Traders will also watch how quickly the expanded buyback authorization turns into actual repurchases.
