Why Toast Stock Dropped 15% in February
Shares of restaurant-technology company Toast (NYSE: TOST) dropped 15.2% in February, according to data provided by S&P Global Market Intelligence. The stock was actually up 16% early in the month before reporting disappointing financial results midmonth that sent the stock into a free-fall.
On Feb. 16, Toast reported full-year financial results for 2022. Many of its metrics were better than analyst expectations, but investors seemed concerned about the company's bottom line. Consider that full-year revenue increased a whopping 60% year over year to $2.7 billion. But its loss from operations got worse, going from an operating loss of $228 million in 2021 to an operating loss of $384 million in 2022.
Looking at adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) -- a much easier profitability hurdle to jump over -- Toast still had a loss of $115 million in 2022. And while management expects this to improve in 2023 to an adjusted EBITDA loss between $10 million and $30 million, that's still a loss. Moreover, profitability metrics that aren't adjusted will likely look far worse.
Source Fool.com
