ServiceTitan shipped $268.8M in Q1 revenue, up 25% YoY, crossing $1B ARR without acquisitions. The vertical software company serves 11,800+ trades businesses (HVAC, plumbing, electrical) and processed $21.7B in quarterly transaction volume.
The fintech play is working
Usage revenue grew 29%, faster than the 24% subscription growth. Fintech now accounts for 22% of platform revenue, the fastest-growing segment. When you own the operating system for contractors, payments attach almost for free. The take rate scales with customer success, not just seat count.
Gross Transaction Volume hit $21.7B, about $87B annualized. That is Toast's playbook: own the system of record, monetize the money movement on top.
Margin expansion without cutting sales
Non-GAAP operating margin doubled from 7.5% to 15.2%. Revenue grew 25%, sales and marketing spend grew 5.6%. When revenue grows five times faster than sales spend, margins expand on their own.
The company is not banking the efficiency gains. R&D spend is up 27% to $88M, now 33% of revenue. They are pouring it into AI agents and a product called Max, which doubled footprint in Q1 and is guided to double again in Q2.
The market is not impressed
Stock trades at $78, down 40% from its $120 high. Market cap sits around $7.5B, roughly 6x-7x ARR. For a company growing 25% at $1B scale with 110% NRR and margins doubling, that is an ordinary multiple.
ServiceTitan clears Rule of 40 (25% growth plus 15.2% margin equals 40+). Growth decelerated slightly from 27% last year, but staying at 25% on a billion-dollar base is rare. The public markets want accelerators right now, not consistent growers.
What this means for vertical SaaS
If you are building vertical software, the question is not whether to add payments. It is how big payments can get. ServiceTitan's usage revenue proves the model: subscriptions get you in the door, fintech scales with your customers' revenue.
The company employs 600+ people across Glendale and Atlanta, with UK and Ireland expansion underway. No confirmed ANZ presence yet. Sales org structure and comp details are not public, but at this scale, expect a mature enterprise motion with territory-based AEs and a growing SDR team to fuel the 25% growth rate.
Net Revenue Retention at 110% means existing customers are expanding. That is the metric that matters when you are past $1B ARR. New logo growth is hard at this stage. Expansion revenue is the engine.