How Toast's new AI Retail Workflow At Toast (TOST) is changing the investment story

• In early January 2026, Toast announced new retail-focused updates to the Toast IQ AI assistant and broader platform, adding real-time inventory actions, catalog optimization tools, AI invoice scanning, cloud-enabled scale and label integration, and AI-supported digital advertising capabilities.
• A particularly interesting development is Toast IQ's ability to make operational changes directly from the chat interface, such as marking a product as out of stock or generating a product description. This could significantly change the way retailers manage their daily workflows.
• Here, we explore how these new AI-driven retail capabilities, specifically Toast IQ's real-time operational actions, could impact Toast's existing investment story.

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Cheers Investment Story Summary

To own Toast, you need to believe that you can expand your restaurant-focused platform into adjacent verticals while maintaining profitability growth. The new retail-focused AI updates support the broader platform story, but do not significantly change the short-term focus on maintaining transactional and software growth while managing increasing competitive pressures and hardware cost risks.

Among recent announcements, Toast IQ's expansion into real-time retail inventory and catalog actions stands out as the most relevant here. If retailers deploy these tools at scale, Toast could play a deeper role in customers' daily operations, potentially reinforcing the existing catalyst of higher ARPU from additional software and fintech modules rather than changing the current risk profile.

But the bigger question for investors is whether these new AI and retail tools can offset the ongoing risks.

Read the full story on Toast (it's free!)

Toast's story projects sales of $8.9 billion and profits of $738.5 million by 2028.

We reveal how Toast's projections yield a fair value of $47.75, 35% above its current price.

explore other perspectives

15 members of the Simply Wall St Community currently see Toast's fair value at between US$30.03 and US$60.85, with opinions spread across that range. When weighing these opinions, it's worth considering the extent to which you think Toast's commitment to AI-powered automation can actually support efforts to grow high-margin software and fintech revenues over the long term.

Check out 15 other fair value estimates on Toast – Find out why the stock is worth 72% more than its current price.

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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.

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