Shake Shack Announces Fourth Quarter and Fiscal Year 2025 Financial Results

NEW YORK--( BUSINESS WIRE)--Shake Shack Inc. (“Shake Shack” or the “Company”) (NYSE: SHAK) has posted its results for the fourth quarter and the fiscal year ended December 31, 2025 in a Shareholder Letter in the Quarterly Results section of the Company's Investor Relations website, which can be found here: Q4 2025 Shareholder Letter.

Shake Shack will host a conference call at 8:00 a.m. ET. Hosting the call will be Robert Lynch, Chief Executive Officer. The conference call can be accessed live over the phone by dialing (877) 407-0792, or for international callers by dialing (201) 689-8263. A replay of the call will be available until March 5, 2026 by dialing (844) 512-2921 or for international callers by dialing (412) 317-6671; the passcode is 13757509.

The live audio webcast of the conference call will be accessible in the Events & Presentations section of the Company's Investor Relations website at investor.shakeshack.com. An archived replay of the webcast will also be available shortly after the live event has concluded.

(1)

Restaurant-level profit, Adjusted EBITDA and Adjusted pro forma net income are non-GAAP measures. A reconciliation to the most directly comparable financial measures presented in accordance with GAAP is set forth in the schedules accompanying this release. See “Non-GAAP Financial Measures” below.

About Shake Shack

Shake Shack serves elevated versions of American classics using only the best ingredients. It’s known for its delicious made-to-order Angus beef burgers, crispy chicken, hand-spun milkshakes, house-made lemonades, beer, wine, and more. With its high-quality food at a great value, warm hospitality, and a commitment to crafting uplifting experiences, Shake Shack quickly became a cult-brand with widespread appeal. Shake Shack’s purpose is to Stand For Something Good®, from its premium ingredients and employee development, to its inspiring designs and deep community investment. Since the original Shack opened in 2004 in NYC’s Madison Square Park, the Company has expanded to over 670 locations system-wide, including close to 430 in 35 U.S. States and the District of Columbia, and over 240 international locations across London, Hong Kong, Shanghai, Singapore, Mexico City, Istanbul, Dubai, Tokyo, Seoul and more.

Skip the line with the Shack App, a mobile ordering app that lets you save time by ordering ahead! Guests can select their location, pick their food, choose a pickup time and their meal will be cooked-to-order and timed to arrival. Available on iOS and Android.

Definitions

The following definitions apply to these terms as used in this release:

"Shack sales" is defined as the aggregate sales of food, beverages, gift card breakage income and Shake Shack branded merchandise at Company-operated Shacks and excludes sales from licensed Shacks.

“System-wide sales” is an operating measure and consists of sales from Company-operated Shacks and licensed Shacks. The Company does not recognize the sales from licensed Shacks as revenue. Of these amounts, revenue is limited to licensing revenue based on a percentage of sales from licensed Shacks, as well as certain up-front fees, such as territory fees, opening fees, and termination fees.

"Same-Shack sales" represents Shack sales for the comparable Shack base, which is defined as the number of Company-operated Shacks open for 24 full fiscal months or longer. For consecutive days that Shacks were temporarily closed, the comparative period was also adjusted.

"Restaurant-level profit," a non-GAAP measure, is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses.

"Restaurant-level profit margin," a non-GAAP measure, is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses as a percentage of Shack sales.

“EBITDA,” a non-GAAP measure, is defined as Net income before interest expense (net of interest income), Income tax expense, and Depreciation and amortization expense.

“Adjusted EBITDA,” a non-GAAP measure, is defined as EBITDA (as defined above), excluding equity-based compensation expense, Impairments, loss on disposal of assets, and Shack closures, amortization of cloud-based software implementation costs, as well as certain non-recurring items that the Company does not believe directly reflect its core operations and may not be indicative of the Company's recurring business operations.

"Adjusted pro forma net income," a non-GAAP measure, represents Net income attributable to Shake Shack Inc. assuming the full exchange of all outstanding SSE Holdings, LLC membership interests ("LLC Interests") for shares of Class A common stock, adjusted for certain non-recurring items that the Company does not believe are directly reflected to its core operations and may not be indicative of its recurring business operations.

SHAKE SHACK INC.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(in thousands, except share and per share amounts)

December 31

2025

December 25

2024

ASSETS

Current assets

Cash and cash equivalents

360,123

320,714

Accounts receivable, net

32,962

19,687

Inventories

7,182

6,014

Prepaid expenses and other current assets

30,080

21,801

Total current assets

430,347

368,216

Property and equipment, net of accumulated depreciation of $551,004 and $457,186, respectively.

625,851

551,600

Operating lease assets

507,253

424,611

Deferred income taxes, net

322,385

341,586

Other assets

10,373

10,958

TOTAL ASSETS

1,896,209

1,696,971

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable

24,747

23,609

Accrued expenses

103,354

63,005

Accrued wages and related liabilities

25,481

25,422

Operating lease liabilities, current

63,553

55,739

Other current liabilities

27,783

19,538

Total current liabilities

244,918

187,313

Long-term debt

247,731

246,683

Long-term operating lease liabilities

575,138

494,499

Liabilities under tax receivable agreement, net of current portion

244,463

247,017

Other long-term liabilities

30,210

27,833

Total liabilities

1,342,460

1,203,345

Commitments and contingencies

Stockholders' equity:

Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of December 31, 2025 and December 25, 2024.

—

Class A common stock, $0.001 par value—200,000,000 shares authorized; 40,254,281 and 40,068,068 shares issued and outstanding as of December 31, 2025 and December 25, 2024, respectively.

Class B common stock, $0.001 par value—35,000,000 shares authorized; 2,434,789 and 2,455,713 shares issued and outstanding as of December 31, 2025 and December 25, 2024, respectively.

Additional paid-in capital

452,577

442,993

Retained earnings

72,709

26,984

Accumulated other comprehensive loss

)

Total stockholders' equity attributable to Shake Shack Inc.

525,327

470,018

Non-controlling interests

28,422

23,608

Total equity

553,749

493,626

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

1,896,209

1,696,971

SHAKE SHACK INC.

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(in thousands, except per share amounts)

Fiscal Quarter Ended

Fiscal Year Ended

December 31

2025 (1)

December 25

2024

December 31

2025 (1)

December 25

2024

Shack sales

385,258

96.2

316,632

96.3

1,391,166

96.3

1,207,561

96.4

Licensing revenue

15,273

3.8

12,052

3.7

54,140

3.7

45,047

3.6

TOTAL REVENUE

400,531

100.0

328,684

100.0

1,445,306

100.0

1,252,608

100.0

Shack-level operating expenses (2):

Food and paper costs

110,595

28.7

88,578

28.0

396,714

28.5

339,940

28.2

Labor and related expenses

97,934

25.4

85,104

26.9

360,693

25.9

338,750

28.1

Other operating expenses

59,868

15.5

47,008

14.8

212,677

15.3

178,381

14.8

Occupancy and related expenses

29,413

7.6

24,047

7.6

106,632

7.7

93,069

7.7

General and administrative expenses

50,541

12.6

41,099

12.5

176,233

12.2

149,047

11.9

Depreciation and amortization expense

26,433

6.6

25,809

7.9

106,600

7.4

102,468

8.2

Pre-opening costs

5,203

1.3

5,118

1.6

18,001

1.2

15,547

1.2

Impairments, loss on disposal of assets, and Shack closures

1,800

0.4

1,711

0.5

5,248

0.4

32,368

2.6

TOTAL EXPENSES

381,787

95.3

318,474

96.9

1,382,798

95.7

1,249,570

99.8

INCOME FROM OPERATIONS

18,744

4.7

10,210

3.1

62,508

4.3

3,038

0.2

Other income, net

3,336

0.8

3,241

1.0

12,260

0.8

13,251

1.1

Interest expense

(544

)

(0.1

(512

)

(0.2

(2,159

)

(0.1

(2,045

)

(0.2

INCOME BEFORE INCOME TAXES

21,536

5.4

12,939

3.9

72,609

5.0

14,244

1.1

Income tax expense

8,537

2.1

3,606

1.1

22,903

1.6

3,424

0.3

NET INCOME

12,999

3.2

9,333

2.8

49,706

3.4

10,820

0.9

Less: Net income attributable to non-controlling interests

1,168

0.3

623

0.2

3,981

0.3

613

—

NET INCOME ATTRIBUTABLE TO SHAKE SHACK INC.

11,831

3.0

8,710

2.6

45,725

3.2

10,207

0.8

Earnings per share of Class A common stock:

Basic

0.29

0.22

1.14

0.26

Diluted

0.28

0.21

1.09

0.24

Weighted-average shares of Class A common stock outstanding:

Basic

40,254

40,047

40,212

39,830

Diluted

41,831

41,872

41,847

44,203

The Company operates on a 52/53 week fiscal year. Fiscal year 2025 had 53 weeks with the extra operating week occurring in fiscal fourth quarter 2025.

SHAKE SHACK INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands)

Fiscal Year Ended

December 31

2025

December 25

2024

OPERATING ACTIVITIES

Net income (including amounts attributable to non-controlling interests)

49,706

10,820

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization expense

106,600

102,468

Amortization of debt issuance costs

1,048

1,047

Amortization of cloud computing assets

2,188

2,138

Non-cash operating lease cost

88,849

77,432

Equity-based compensation

19,503

15,915

Deferred income taxes

16,616

(1,054

)

Non-cash interest

(102

)

Net amortization of discount on held-to-maturity securities

—

(440

)

Impairments, loss on disposal of assets, and Shack closures

5,248

32,368

Changes in operating assets and liabilities:

Accounts receivable

(9,546

)

(2,839

)

Inventories

(1,168

)

(610

)

Prepaid expenses and other current assets

(3,115

)

(2,629

)

Other assets

(5,959

)

(2,896

)

Accounts payable

(1,527

)

3,356

Accrued expenses

29,902

6,644

Accrued wages and related liabilities

4,477

Other current liabilities

3,436

(712

)

Operating lease liabilities

(82,683

)

(77,167

)

Other long-term liabilities

3,153

2,939

NET CASH PROVIDED BY OPERATING ACTIVITIES

222,355

171,155

INVESTING ACTIVITIES

Purchases of property and equipment

(165,849

)

(135,499

)

Maturities of held-to-maturity marketable securities

—

69,420

NET CASH USED IN INVESTING ACTIVITIES

(165,849

)

(66,079

)

FINANCING ACTIVITIES

Payments on principal of finance leases

(5,511

)

(3,964

)

Deferred financing costs

(10

)

—

Distributions paid to non-controlling interest holders

(1,842

)

(482

)

Payments under tax receivable agreement

(37

)

—

Net proceeds from stock option exercises

123

1,627

Employee withholding taxes related to net settled equity awards

(9,820

)

(6,198

)

NET CASH USED IN FINANCING ACTIVITIES

(17,097

)

(9,017

)

Effect of exchange rate changes on cash and cash equivalents

—

INCREASE IN CASH AND CASH EQUIVALENTS

39,409

96,061

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

320,714

224,653

CASH AND CASH EQUIVALENTS AT END OF PERIOD

360,123

320,714

SHAKE SHACK INC.

NON-GAAP FINANCIAL MEASURES

(UNAUDITED)

To supplement the Consolidated Financial Statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company uses the following non-GAAP financial measures: Restaurant-level profit, Restaurant-level profit margin, EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted pro forma net income and adjusted pro forma earnings per fully exchanged and diluted share (collectively the "non-GAAP financial measures").

Restaurant-Level Profit

Restaurant-level profit is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses.

How This Measure Is Useful

When used in conjunction with GAAP financial measures, Restaurant-level profit and Restaurant-level profit margin are supplemental measures of operating performance that the Company believes are useful measures to evaluate the performance and profitability of its Shacks. Additionally, Restaurant-level profit and Restaurant-level profit margin are key metrics used internally by management to develop internal budgets and forecasts, as well as assess the performance of its Shacks relative to budget and against prior periods. It is also used to evaluate employee compensation as it serves as a metric in certain performance-based employee bonus arrangements. The Company believes presentation of Restaurant-level profit and Restaurant-level profit margin provides investors with a supplemental view of its operating performance that can provide meaningful insights to the underlying operating performance of the Shacks, as these measures depict the operating results that are directly impacted by the Shacks and exclude items that may not be indicative of, or are unrelated to, the ongoing operations of the Shacks. It may also assist investors to evaluate the Company's performance relative to peers of various sizes and maturities and provides greater transparency with respect to how management evaluates the business, as well as the financial and operational decision-making.

Limitations of the Usefulness of this Measure

Restaurant-level profit and Restaurant-level profit margin may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of Restaurant-level profit and Restaurant-level profit margin is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Restaurant-level profit excludes certain costs, such as General and administrative expenses and Pre-opening costs, which are considered normal, recurring cash operating expenses and are essential to support the operation and development of the Company's Shacks. Therefore, this measure may not provide a complete understanding of the Company's operating results as a whole and Restaurant-level profit and Restaurant-level profit margin should be reviewed in conjunction with the Company's GAAP financial results. A reconciliation of Restaurant-level profit to Income from Operations, the most directly comparable GAAP financial measure, is set forth below.

Fiscal Quarter Ended

Fiscal Year Ended

(dollar amounts in thousands)

December 31

2025 (1)

December 25

2024

December 31

2025 (1)

December 25

2024

Income from operations

18,744

10,210

62,508

3,038

Less:

Licensing revenue

15,273

12,052

54,140

45,047

Add:

General and administrative expenses

50,541

41,099

176,233

149,047

Depreciation and amortization expense

26,433

25,809

106,600

102,468

Pre-opening costs

5,203

5,118

18,001

15,547

Impairments, loss on disposal of assets, and Shack closures

1,800

1,711

5,248

32,368

Adjustment:

Employee benefit charges (2)

—

453

Restaurant-level profit

87,448

71,895

314,450

257,874

Total revenue

400,531

328,684

1,445,306

1,252,608

Less: Licensing revenue

15,273

12,052

54,140

45,047

Shack sales

385,258

316,632

1,391,166

1,207,561

Restaurant-level profit margin (3)

22.7

22.6

21.4

(1)

The Company operates on a 52/53 week fiscal year. Fiscal year 2025 had 53 weeks with the extra operating week occurring in fiscal fourth quarter 2025.

SHAKE SHACK INC.

NON-GAAP FINANCIAL MEASURES

(UNAUDITED)

EBITDA and Adjusted EBITDA

EBITDA, a non-GAAP measure, is defined as Net income before interest expense (net of interest income), Income tax expense and Depreciation and amortization expense. Adjusted EBITDA, a non-GAAP measure, is defined as EBITDA excluding equity-based compensation expense, Impairments, loss on the disposal of assets, and Shack closures, amortization of cloud-based software implementation costs, as well as certain non-recurring items that the Company does not believe directly reflect its core operations and may not be indicative of the Company's recurring business operations.

How These Measures Are Useful

When used in conjunction with GAAP financial measures, EBITDA and adjusted EBITDA are supplemental measures of operating performance that the Company believes are useful measures to facilitate comparisons to historical performance and competitors' operating results. Adjusted EBITDA is a key metric used internally by management to develop internal budgets and forecasts and also serves as a metric in its performance-based equity incentive programs and certain bonus arrangements. The Company believes presentation of EBITDA and adjusted EBITDA provides investors with a supplemental view of the Company's operating performance that facilitates analysis and comparisons of its ongoing business operations because they exclude items that may not be indicative of the Company's ongoing operating performance.

Limitations of the Usefulness of These Measures

EBITDA and adjusted EBITDA may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of EBITDA and adjusted EBITDA is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA and adjusted EBITDA exclude certain normal recurring expenses. Therefore, these measures may not provide a complete understanding of the Company's performance and should be reviewed in conjunction with the GAAP financial measures.

Fiscal Quarter Ended

Fiscal Year Ended

(dollar amounts in thousands)

December 31

2025 (1)

December 25

2024

December 31

2025 (1)

December 25

2024

Net income

12,999

9,333

49,706

10,820

Depreciation and amortization expense

26,433

25,809

106,600

102,468

Interest expense, net

499

474

1,994

1,284

Income tax expense

8,537

3,606

22,903

3,424

EBITDA

48,468

39,222

181,203

117,996

Equity-based compensation

5,330

4,376

19,503

15,915

Amortization of cloud-based software implementation costs

512

561

2,188

2,138

Impairments, loss on disposal of assets, and Shack closures

1,800

1,711

5,248

32,368

Legal settlements (2)

—

983

—

Severance

—

379

—

Restatement costs (3)

—

778

354

2,378

CEO transition costs

—

679

Employee benefit charges (4)

—

453

Other (5)

—

3,652

Adjusted EBITDA

56,110

46,694

209,896

175,579

Adjusted EBITDA margin (6)

14.0%

14.2%

14.5%

14.0%

(1)

The Company operates on a 52/53 week fiscal year. Fiscal year 2025 had 53 weeks with the extra operating week occurring in fiscal fourth quarter 2025.

(2)

Expenses incurred to establish accruals related to the settlements of legal matters.

(3)

Expenses incurred related to the restatement of prior periods in the 2023 Form 10-K.

(4)

(5)

(6)

SHAKE SHACK INC.

NON-GAAP FINANCIAL MEASURES

(UNAUDITED)

Adjusted Pro Forma Net Income (Loss) and Adjusted Pro Forma Earnings (Loss) Per Fully Exchanged and Diluted Share

Adjusted pro forma net income represents Net income attributable to Shake Shack Inc. assuming the full exchange of all outstanding SSE Holdings, LLC membership interests ("LLC Interests") for shares of Class A common stock, adjusted for certain non-recurring items that the Company does not believe are directly related to its core operations and may not be indicative of recurring business operations. Adjusted pro forma earnings per fully exchanged and diluted share is calculated by dividing adjusted pro forma net income by the weighted-average shares of Class A common stock outstanding, assuming the full exchange of all outstanding LLC Interests, after giving effect to the dilutive effect of outstanding equity-based awards.

How These Measures Are Useful

When used in conjunction with GAAP financial measures, adjusted pro forma net income and adjusted pro forma earnings per fully exchanged and diluted share are supplemental measures of operating performance that the Company believes are useful measures to evaluate performance period-over-period and relative to its competitors. By assuming the full exchange of all outstanding LLC Interests, the Company believes these measures facilitate comparisons with other companies that have different organizational and tax structures, as well as comparisons period over period because it eliminates the effect of any changes in Net income attributable to Shake Shack Inc. driven by increases in its ownership of SSE Holdings, which are unrelated to the Company's operating performance, and excludes items that are non-recurring or may not be indicative of ongoing operating performance.

Limitations of the Usefulness of These Measures

Adjusted pro forma net income and adjusted pro forma earnings per fully exchanged and diluted share may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of adjusted pro forma net income and adjusted pro forma earnings per fully exchanged and diluted share should not be considered alternatives to Net income and earnings (loss) per share, as determined under GAAP. While these measures are useful in evaluating the Company's performance, it does not account for the earnings (loss) attributable to the non-controlling interest holders and therefore does not provide a complete understanding of the Net income attributable to Shake Shack Inc. Adjusted pro forma net income and adjusted pro forma earnings per fully exchanged and diluted share should be evaluated in conjunction with GAAP financial results. A reconciliation of adjusted pro forma net income to Net income attributable to Shake Shack Inc., the most directly comparable GAAP measure, and the computation of adjusted pro forma earnings per fully exchanged and diluted share are set forth below.

Fiscal Quarter Ended

Fiscal Year Ended

(in thousands, except per share amounts)

December 31

2025 (1)

December 25

2024

December 31

2025 (1)

December 25

2024

Numerator:

Net income attributable to Shake Shack Inc.

11,831

8,710

45,725

10,207

Adjustments:

Reallocation of Net income attributable to non-controlling interests from the assumed exchange of LLC Interests (2)

1,168

623

3,981

613

Impairment charges and Shack closures (3)

1,045

1,191

2,949

29,348

Legal settlements (4)

—

983

—

Severance

—

379

—

Restatement costs (5)

—

778

354

2,378

CEO transition costs

—

679

Employee benefit charges (6)

—

453

Other (7)

—

3,652

Tax impact of above adjustments (8)

2,543

269

3,906

(6,785

)

Adjusted pro forma net income

16,587

11,617

58,315

40,545

Denominator:

Weighted-average shares of Class A common stock outstanding—diluted

41,831

41,872

41,847

44,203

Adjustments:

Assumed exchange of LLC Interests for shares of Class A common stock (2)

2,434

2,456

2,441

—

Adjusted pro forma fully exchanged weighted-average shares of Class A common stock outstanding—diluted

44,265

44,328

44,288

44,203

Adjusted pro forma loss per fully exchanged share—diluted

0.37

0.26

1.32

0.92

Fiscal Quarter Ended

Fiscal Year Ended

December 31

2025 (1)

December 25

2024

December 31

2025 (1)

December 25

2024

Earnings per share of Class A common stock—diluted

0.28

0.21

1.09

0.24

Assumed exchange of LLC Interests for shares of Class A common stock (2)

0.01

—

0.03

—

Non-GAAP adjustments (9)

0.08

0.05

0.20

0.68

Adjusted pro forma earnings per fully exchanged share—diluted

0.37

0.26

1.32

0.92

(1)

The Company operates on a 52/53 week fiscal year. Fiscal year 2025 had 53 weeks with the extra operating week occurring in fiscal fourth quarter 2025.

(2)

Assumes the exchange of all outstanding LLC Interests for shares of Class A common stock, resulting in the elimination of the non-controlling interest and recognition of the net income attributable to non-controlling interests.

(3)

Expenses incurred related to Shack closures and impairment charges during fiscal 2024 and fiscal 2025.

(4)

Expenses incurred to establish accruals related to the settlements of legal matters.

(5)

Expenses incurred related to the restatement of prior periods in the 2023 Form 10-K.

(6)

Expenses related to California healthcare charges for fiscal 2020 through 2023 which do not represent fiscal 2024 Labor and related expenses.

(7)

(8)

(9)