Shares of Toast, Inc. (NYSE: TOST) jumped 5.5% in after-hours trading on Wednesday, following the restaurant technology platform's release of better-than-expected third-quarter earnings and an optimistic outlook for the full year.

The company reported earnings per share of $0.16, surpassing analyst estimates of $0.15. Revenue for the quarter came in at $1.63 billion, beating the expected $1.58 billion. These results demonstrated Toast's ability to outperform market expectations in a challenging economic environment.

Key highlights from Toast's Q3 performance include:

• Annualized recurring revenue (ARR) grew 30% year-over-year to over $2.0 billion
• Added approximately 7,500 net new locations, bringing the total to 156,000 globally
• Adjusted EBITDA reached $176 million, showcasing improved profitability

Toast CEO Aman Narang expressed satisfaction with the results, stating, "Toast delivered another strong quarter — ARR grew 30% to over $2.0 billion, Adjusted EBITDA was $176 million, and we added approximately 7,500 net locations and now power 156,000 locations globally."

Adding to investor optimism, Toast raised its full-year 2025 guidance. The company now projects non-GAAP subscription services and financial technology solutions gross profit between $1,865 million and $1,875 million, representing a 32% increase. Additionally, Toast expects adjusted EBITDA for the year to be between $610 million and $620 million.

The strong quarterly performance, coupled with the upbeat outlook, has fueled investor confidence in Toast's growth trajectory, driving the stock's after-hours rally.