Gross Margin % is calculated as gross profit divided by its revenue. Toast's Gross Profit for the
three
months ended in Mar. 2022 was $89 Mil. Toast's Revenue for the
three
months ended in Mar. 2022 was $535 Mil. Therefore, Toast's Gross Margin % for the quarter that ended in Mar. 2022 was 16.64%.
The historical rank and industry rank for Toast's Gross Margin % or its related term are showing as below:
TOST'
s Gross Margin % Range Over the Past 10 Years
Min: 9.32 Med: 17.01 Max: 18.42
Current: 17.06
During the past 3 years, the highestGross Margin % of Toast was 18.42%. The lowest was 9.32%. And the median was 17.01%.
TOST's Gross Margin % is ranked worse than 86.95% of 2482
companies
in the Software industry
Industry Median: 45.55
vs TOST: 17.06
Toast had a gross margin of 16.64% for the quarter that ended in Mar. 2022 => No sustainable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Toast was 0.00% per year.
Toast Gross Margin % Historical Data
The historical data trend for Toast's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Toast Annual Data
Trend
Dec19
Dec20
Dec21
Gross Margin %
9.32
17.01
18.42
Toast Quarterly Data
Dec19
Sep20
Dec20
Mar21
Jun21
Sep21
Dec21
Mar22
Gross Margin %
24.47
20.34
17.12
14.76
16.64
Competitive Comparison
For the Software - Infrastructure subindustry, Toast's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Toast Gross Margin % Distribution
For the Software industry and Technology sector, Toast's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Toast's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Toast (NYSE:TOST) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Toast had a gross margin of 16.64% for the quarter that ended in Mar. 2022 => No sustainable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Toast Gross Margin % Related Terms
Thank you for viewing the detailed overview of Toast's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Toast is a U.S.-based restaurant technology company that provides point-of-sale, payment processing, and various software services to 57,000 restaurant locations across the United States. The firm generates sales from software subscription fees, as a percentage take rate from each financial transaction it processes, and from hardware installation and professional services. Unlike competitors, Toast intermediates every payment transaction on its platform, processing some $57 billion in gross platform volume in 2021. The firm's product offerings span point-of-sale systems, inventory and payroll management, delivery integration, e-commerce ordering, and loyalty programs.
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