Toast TOST is expanding beyond independent U.S. restaurants into enterprise chains, retail and international markets. Management said these newer markets are gaining traction, with annualized recurring run-rate (ARR) growing faster and software revenue per location exceeding that of Toast’s core business at a comparable stage.
Enterprise offers clear proof of Toast’s expansion strategy. Hungry Howie’s selected Toast’s enterprise technology suite for implementation across roughly 500 restaurants, including its point-of-sale (POS) terminals, Multi-Location Management, Kitchen Display System (KDS) and Toast Payment Processing. Toast also launched Toast Drive-Thru, an enterprise-grade solution designed to serve more than 140,000 U.S. locations.
Retail is another important growth path. Toast now serves more than 100 grocery locations, each generating more than $5 million in annual sales. Management estimates that more than 20,000 independent U.S. grocers generate more than $250 billion in sales, creating a sizable opportunity for Toast’s payments, inventory and supplier tools.
Internationally, Toast is focusing on dense, high-volume cities such as London, Toronto, Sydney and Melbourne. Its support for an International Chamber of Commerce UK Trade & Export initiative could raise its profile with hospitality groups expanding between the UK and the United States. Toast is backing that expansion with local teams, round-the-clock service and operating data that can be shared globally.
Toast entered 2026 with strong momentum, giving its broader expansion plan added weight. First-quarter revenues increased 21.9% to $1.63 billion, while ARR climbed 26% to $2.2 billion. It added 7,000 net new locations in the quarter, with total locations increasing 22% year over year to nearly 171,000.
How Are Block & Lightspeed Expanding?
Block’s XYZ Square is a strong direct competitor. Square combines restaurant POS, payments, handheld hardware, online ordering, inventory and franchise-management tools, while its Uber Eats integration is expanding internationally. Square said that food-and-beverage seller GPV grew 21% year over year in first-quarter 2026.
Lightspeed POS LSPD competes across hospitality and retail. Its platform combines POS, global payments, inventory management, supplier connections, analytics and multichannel sales, helping multi-location merchants operate efficiently across physical and digital channels. Lightspeed serves businesses in more than 100 countries worldwide.
TOST’s Price Performance, Valuation & Estimates
Shares of Toast have outperformed in the past three months compared with the broader industry.
Image Source: Zacks Investment Research
From a valuation standpoint, Toast’s shares has a Value Score of C. In terms of forward 12-month P/E, TOST stock is trading at 26.34X, which is at a discount to the Zacks Internet Software industry’s 28.50X.
Image Source: Zacks Investment Research
Toast’s estimate revisions reflect a positive trend. The Zacks Consensus Estimate for full-year 2026 EPS has been revised upward to $1.35 in the past two months. The consensus estimate for the metric indicates a year-over-year increase of 51.69%.
Image Source: Zacks Investment Research
Toast currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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