B+
Overall grade
B
Financial quality
Toast IQ is the sleeper story - 25k restaurants used it 235k times in one month, creating real operational dependency that competitors can't easily replicate. The obvious headline is solid Q3 execution, but the real constraint is management's conservative approach to monetizing their AI advantage while investing heavily in new TAMs. Aman's quote 'Toast IQ feels like having a personal assistant' captures the stickiness potential. My view changes if they start charging for Toast IQ within 6 months or if October's GPV normalization becomes a sustained downturn.
The 30-second version
- Toast IQ is the sleeper product launch everyone's underestimating
- New TAM acceleration is real but management's getting vague about enterprise timeline
- Take rate expansion is the hidden margin story
What changed this quarter
| Metric | Prior | This quarter |
|---|---|---|
| Recurring Gross Profit Growth | 35% YoY in Q2 | 34% YoY in Q3 |
| ARR Growth | 31% YoY in Q2 | 30% YoY in Q3 |
| Total Take Rate | 93 bps in Q2 2024 | 98 bps in Q3 2025 |
| Net Location Adds | ~8,500 in Q2 | ~7,500 in Q3 |
| Total Locations | 148k locations in Q2 | 156k locations in Q3 |
| GPV | $50B in Q2 (+23% YoY) | $52B in Q3 (+24% YoY) |
| Adjusted EBITDA | $161M (35% margin) in Q2 | $176M (35% margin) in Q3 |
| SaaS ARR Growth | 30% YoY in Q2 | 28% YoY in Q3 |
Accountability tracked
7 new promises made4 narrative shifts flagged6 prior promises graded
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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