TOAST Reports 44.9% Increase in Revenue for Second Quarter of Fiscal Year 2023
August 17, 2023
☀️Earnings Overview
At the end of the second quarter of fiscal year 2023 (June 30, 2023), TOAST ($NYSE:TOST) reported a total revenue of USD 978.0 million, a 44.9% increase compared to the same period of the prior year. Unfortunately, the company’s net income decreased by USD -54.0 million to USD -98.0 million.
Analysis
GoodWhale has conducted an analysis of TOAST’s fundamentals, and based on its Star Chart, it has been given an intermediate health score of 6/10 with regard to its cashflows and debt. This suggests that it is likely to sustain future operations in times of crisis. TOAST receives strong reviews in terms of its assets and growth, but its dividend and profitability are weaker. Additionally, TOAST is classified as a “cheetah”; this type of company has achieved high revenue or earnings growth, but it is considered to be less stable due to lower profitability. Investors looking for higher growth potential but with an understanding of the possible risks may be interested in this type of company. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Toast. TOAST_Reports_44.9_Increase_in_Revenue_for_Second_Quarter_of_Fiscal_Year_2023″>More…
| Total Revenues | Net Income | Net Margin |
| 3.32k | -377 | -9.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Toast. TOAST_Reports_44.9_Increase_in_Revenue_for_Second_Quarter_of_Fiscal_Year_2023″>More…
| Operations | Investing | Financing |
| -93 | -110 | 42 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Toast. TOAST_Reports_44.9_Increase_in_Revenue_for_Second_Quarter_of_Fiscal_Year_2023″>More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.79k | 716 | 2.03 |
Key Ratios Snapshot
Some of the financial key ratios for Toast are shown below. TOAST_Reports_44.9_Increase_in_Revenue_for_Second_Quarter_of_Fiscal_Year_2023″>More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 60.1% | – | -10.8% |
| FCF Margin | ROE | ROA |
| -4.1% | -20.5% | -12.4% |
Peers
In the market for point-of-sale (POS) systems, there is intense competition among a few major players. Toast Inc, GreenBox POS, Rs2 Software PLC, and Hank Payments Corp are all vying for a share of the market. All of these companies offer POS systems that are feature-rich and competitively priced.
– GreenBox POS ($NASDAQ:GBOX)
PLC is a publicly traded company with a market capitalization of 266.3 million as of 2022. It has a return on equity of 6.98%. PLC is engaged in the development, manufacture and sale of software products and services. The company’s products and services are used by businesses and organizations of all sizes, in a variety of industries, including healthcare, financial services, manufacturing, retail, and education.
– Rs2 Software PLC ($LTS:0MVH)
Hank Payments Corp is a publicly traded company that provides mobile payment solutions. The company has a market capitalization of 4.02 million as of 2022. Hank Payments Corp’s primary product is Hanko, a mobile payment application that allows users to make payments using their smartphone. Hanko is available for both Android and iOS devices.
Summary
TOAST reported strong revenue growth in Q2 2023, with total revenues increasing by 44.9% year-over-year. However, despite this impressive sales growth, the company reported a net loss of USD -98.0 million in the same period, marking a decrease of USD -54.0 million from the same period a year prior. Investors should be aware that the company’s performance may not be as strong as its revenue growth suggests. Analysts should consider the root causes of this net income decline and assess whether the company can sustain its positive sales trend in the future.
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