Shares of restaurant-technology company Toast (NYSE: TOST) dropped like a rock on Thursday after the company reported financial results for the fourth quarter of 2022 that underwhelmed Wall Street. As of 11 a.m. ET, Toast stock was down 19%, but it had been down about 25% earlier in the session.

For Q4, Toast's management had guided for revenue of $760 million at most. In Q4, Toast exceeded this guidance with quarterly revenue of $769 million, a 50% year-over-year increase. Moreover, annualized recurring revenue reached $901 million, with faster growth of 59%.

Considering that Toast's revenue was strong, it seems that bottom-line results are the reason the stock dropped so much today. In the previous quarter, management had guided for at least a $20 million loss according to adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). Therefore, its adjusted EBITDA loss of only $18 million was better than guidance.

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Source Fool.com