Toast announced it has laid off 550 employees, roughly 10 percent of its staff.
The Boston-based, restaurant technology company states the move is part of a restructuring plan to lower operating costs.
In an earnings call Thursday, Toast CEO Aman Narang said the cuts “were difficult, but the right decision.”
“Toast grew rapidly over the past few years to support our growing customer community,” Narang said. “It has become clear that we grew our team too quickly in some areas and we need to restructure the organization.”
The company estimates the layoffs will cost $45 million to $55 million in severance-related costs and amount to about $100 million in yearly savings.
Point-of-sale hardware and software provider Toast cuts 550 employees amid restructuring.
Toast’s revenue increased almost 35% year-over-year during the fourth quarter, according to a statement. It did report a net loss of $36 million in Q4 2023, however, that is down compared to a net loss of $99 million in Q4 2022.
Toast serves as a payment processing platform for restaurants, offering tools including point-of-sale systems (POS), mobile payments, online ordering and integration with delivery systems. Its technology is currently used in 106,000 locations— 6,500 of which were added in the fourth quarter.
The company aimed to boost revenue last year by adding a mandatory, 99-cent per order fee to consumers’ online orders. The news was met with instantaneous backlash, leading Toast to drop the fee just weeks later.
The layoffs are to be completed by the end of fiscal year 2024. Toast also laid off about 50 percent of its workforce in 2020.
Despite headwinds, Narang said the goal for the company is to report profit in the first half of 2025.
