Toast stock falls after software price trims; Cuts later reverted

Published 22/09/2025, 16:24
Updated 26/09/2025, 15:14
© Reuters

Investing.com -- Toast Inc (NYSE:TOST) stock fell 5% Monday morning after the restaurant technology provider significantly reduced pricing for its software packages aimed at smaller restaurants, raising concerns about competitive pressures in the industry.

Later in the day, however, Baird reported that Toast’s website pricing had mostly reverted to prior levels, with the steep 26–58% trims observed in the morning no longer in effect by noon CT. In fact, two fees increased slightly: the self-service Basic Software rose about 10% to $109 per month, while the self-service Growth Software inched up 2% to $618 per month.

"We remain balanced on TOST given valuation of ~51X 2026E GAAP EPS (XYZ trading ~25X on a similar basis), and we expect some deceleration in GP growth in coming quarters as location growth and volume growth has decelerated, while SaaS ARPU comp gets much tougher in H2," the firm’s analysts said in this second note.

In its earlier morning note, the firm said the company had cut monthly fees for its "Core" and "Growth" software packages by 26-58% across most hardware types, according to Baird analysts who monitor Toast’s pricing on a weekly basis. These changes were not present in last week’s review.

For handheld and countertop hardware kits, Toast reduced its Core Software package by approximately 34% to $144 per month from $219, while the Growth Software package saw a steeper cut of about 58% to $244 per month from $578.

Self-service hardware kits saw similar reductions, with Core Software prices dropping 26% to $184 monthly from $249, and Growth Software fees decreasing 53% to $284 from $608 monthly. However, the Basic Software option for self-service hardware increased slightly by 10% to $109 per month.

The pricing changes appeared targeted at smaller restaurants that process below $1 million in annualized volume per location, which is smaller than Toast’s core customer base.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.