Toast

Toast generates revenue primarily through financial technology solutions, which include payment processing fees and subscription services for its cloud-based restaurant platform. The company also earns income from hardware sales, professional services, and interchange fees. Lending through Toast Capital represents a growing but smaller segment of its business.

Toast Capital is a lending product that provides financing to restaurant operators using Toast's point-of-sale and payment processing platform. The company leverages the transaction data flowing through its own system to assess creditworthiness, offering a data advantage over traditional lenders that lack direct visibility into daily restaurant sales. Loans are repaid as a fixed percentage of daily card sales.

Toast's competitive advantage stems from its vertically integrated platform built specifically for restaurants — it controls the point-of-sale software, payment processing infrastructure, and ancillary financial products like lending and payroll. This creates high switching costs for restaurant operators who rely on the integrated system and allows Toast to cross-sell using proprietary transaction data. General-purpose payment processors like Square or legacy POS vendors like NCR lack the same level of restaurant-specific integration across front-of-house and back-of-house workflows.

As of its 2023 annual report filed with the SEC, Toast served approximately 106,000 restaurant locations and processed more than $126 billion in gross payment volume during the fiscal year (per SEC filing, 2024). The customer base includes independent restaurants, small chains, and an increasing number of enterprise multi-unit operators.

Toast has expanded beyond its core US market and now operates in the United Kingdom and Canada. International growth remains a stated priority, though the company generates the vast majority of its revenue domestically. Its platform is adapted for local payment methods and regulatory requirements in each international market.