Toast raised its 2026 adjusted EBITDA outlook and lifted its recurring gross profit growth target, giving investors a higher earnings range and a faster expansion goal for its subscription and financial technology businesses.
Toast provides software and financial technology services to restaurant and retail businesses. Its 2026 outlook combines non-GAAP gross profit from subscription services and financial technology solutions in a measure the company calls recurring gross profit streams.
The company now expects adjusted EBITDA of $840 million to $850 million, compared with its previous range of $805 million to $825 million. The new range has a midpoint of $845 million, $30 million above the prior forecast's midpoint. Toast's 26% recurring gross profit growth target replaces an earlier projection of 23% to 25%.
The recurring measure contributed $642 million in the third quarter, up 27% from the same period a year earlier. Adjusted EBITDA reached $240 million, against $176 million in third-quarter 2025. GAAP operating income came to $165 million, compared with $84 million, and net income was $169 million versus $105 million.
CEO Aman Narang said the company added about 8,500 net locations in the quarter. At Sept. 30, its annual recurring run rate stood at $2.5 billion, 24% higher than a year earlier.
Toast expects fourth-quarter recurring gross profit streams of $610 million to $620 million, alongside adjusted EBITDA of $200 million to $210 million. The gross profit range implies year-over-year growth of 22% to 24%, below the third quarter's 27% increase. Toast said it could not reconcile projected non-GAAP measures with comparable GAAP figures without unreasonable effort because future adjustments are difficult to estimate.
Adjusted EBITDA starts with earnings before interest, taxes, depreciation and amortization, then includes specified adjustments. Toast's recurring gross profit streams are also a non-GAAP measure.
