Michael Reddington, who was 24 when the accident happened in March 2012, has had to learn to walk again and still experiences pain from his injuries.
His foot became trapped because part of the escalator in Nottingham's West End Arcade was missing.
Managing agents Hodgson Elkington LLP must pay £125,000 including costs.
The missing part had been absent for at least a day before the accident, creating a gap.
Mr Reddington did not notice the hazard due to poor lighting, and his foot was then crushed between a step and the escalator platform.
Updates on this story and more from Nottinghamshire
Bernard Thorogood, prosecuting, said there was "real potential for a much more serious, if not fatal, injury".
"The public were at risk," he said. "It was a matter of pure chance whose foot or leg went into that gap."
Nottingham Crown Court heard there had been no inspection of the escalator between October 2010 and the accident in March 2012.
The prosecution said the escalator was past its useful life in 2010.
Mr Thorogood said it was not regularly inspected, adding there was a "lack of effective management leading to a range of risks".
Mr Reddington, now 27, said: "It's hard to explain the pain to people because it's such an unusual thing to happen.
"Everyone knows the pain of stubbing their toe but not everyone knows the pain of having their toe ripped off by an escalator.
"It was trapped in this piece of machinery that was going for a few minutes."
In addition to one of his big toes being completely ripped off, the two toes next to it were permanently damaged and the flesh on his foot was torn away.
He was initially in hospital for two weeks and had five operations under general anaesthetic, he was then required to return to hospital twice a week for three months.
The accident also left mental scars as he still experiences flashbacks.
"That day will stay with me forever," he said.
Hodgson Elkington LLP admitted failing to maintain the machine properly and failing to ensure it was in a safe condition. They also admitted that systems to monitor safety on a daily basis were ineffective.
Defence lawyer Tom Gent said the incident was a matter of "significant embarrassment" to the company.
"They are truly sorry for the dreadful injuries that were caused to Michael Reddington and are extremely apologetic that this was allowed to happen," said Mr Gent.
Judge Andrew Hamilton said: "The escalator was known to the defendants to be beyond its sell-by date and they did nothing.
"The defendant clearly forgot their duty in relation to the escalator."
The Health and Safety Executive does not keep data on accidents involving escalators, but a search through news reports suggests incidents like this are rare in the UK.
However, there appears to have been a recent spate of people being crushed in escalators in China.

The man was reported dead at the Yarl's Wood centre earlier.
A Home Office spokesman said Bedfordshire Police had been informed and a full inquiry would be carried out by the Prisons and Probation Ombudsman.
Sally Chidzoy, BBC Look East Home Affairs Correspondent, said a source at the centre told her the man died after drinking an energy drink.
She said: "My source says the man who died had been arrested with his wife and child over an alleged breach of visa regulations at an airport. They are believed to have travelled from the Indian subcontinent.
"I have been told he was staying at the Hummingbird wing. In the morning he was having breakfast with his wife, and was laughing and joking.
"He was given an energy drink and shortly after collapsed and died, I am told."
A Home Office spokesman added: "Our thoughts are with the family at this very sad time."
The spokesman could not comment on claims that he died after drinking an energy drink.

A number of flags and banners were damaged overnight at the camp at Twaddell Avenue.
The damage was reported at about 07:35 BST. Two men aged 21 and 22, and a 20-year-old woman were arrested shortly afterwards.
They have been charged with criminal damage and provocative conduct. The woman has also been charged with theft.
All three are due to appear before Belfast Magistrates' Court on Wednesday.
Loyalists have been protesting at Twaddell Avenue since July, after a decision to restrict an Orange Order parade.
Shopping centre managers have been fined £75,000 for health and safety breaches after a man had his big toe ripped off by an escalator.
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