Shake Shack Inc. (SHAK) Bundle
A Brief History of Shake Shack
Shake Shack Inc., founded in 2004, has transformed from a single hot dog cart in Madison Square Park, New York City, into a global brand known for its high-quality burgers, fries, and shakes. The company's IPO took place in January 2015, raising approximately $105 million and valuing the company at around $1.6 billion. The brand has since expanded significantly, boasting over 552 locations worldwide as of September 25, 2024, including both company-operated and licensed Shacks.
Financial Performance Overview
As of September 25, 2024, Shake Shack reported a net income (loss) attributable to the company of $(10.2) million for the thirteen weeks ending on that date, compared to a net income of $7.6 million for the same period in the prior year. The earnings (loss) per share of Class A common stock for the same period was $(0.26) compared to $0.19 in 2023.
| Financial Metric | 13 Weeks Ended September 25, 2024 | 13 Weeks Ended September 27, 2023 |
|---|---|---|
| Net Income (Loss) Attributable to Shake Shack Inc. | $(10.2) million | $7.6 million |
| Earnings (Loss) per Share (Basic) | $(0.26) | $0.19 |
| Total Revenue | $316.4 million | $276.1 million |
| Shack Sales | $304.9 million | $265.0 million |
Operating Metrics
Shake Shack's system-wide sales for the thirteen weeks ended September 25, 2024, increased by 12.8% to $495.1 million compared to the same period last year. Digital sales also saw significant growth, rising 25.4% to $104.3 million, representing 34.2% of Shack sales during the period.
| Operating Metric | 13 Weeks Ended September 25, 2024 | 13 Weeks Ended September 27, 2023 |
|---|---|---|
| System-wide Sales | $495.1 million | $439.1 million |
| Digital Sales | $104.3 million | $83.2 million |
| Same-Shack Sales Growth | 4.4% | 3.2% |
Expansion and Development
In the thirteen weeks ending September 25, 2024, Shake Shack opened eight new company-operated Shacks and nine licensed Shacks, while also closing nine company-operated Shacks. This brings the total number of Shacks to 552, with 310 being company-operated and 242 licensed locations.
Cost Structure and Expenses
Shake Shack's total expenses for the thirteen weeks ended September 25, 2024, were $334.9 million, an increase from $270.6 million in the previous year. Key components of the cost structure include:
| Expense Category | 13 Weeks Ended September 25, 2024 | 13 Weeks Ended September 27, 2023 |
|---|---|---|
| Labor and Related Expenses | $85.5 million | $76.2 million |
| Food and Paper Costs | $86.1 million | $77.2 million |
| Occupancy and Related Expenses | $23.6 million | $20.3 million |
| General and Administrative Expenses | $35.7 million | $30.9 million |
| Depreciation and Amortization Expense | $25.7 million | $23.1 million |
Overall, Shake Shack continues to expand its footprint while navigating challenges related to operating costs and market conditions. The company's focus on digital sales and customer experience remains central to its growth strategy.
A Who Owns Shake Shack Inc. (SHAK)
Ownership Structure
As of September 25, 2024, Shake Shack Inc. (SHAK) owns 94.2% of SSE Holdings, LLC, which is the operating entity for Shake Shack's restaurants. The remaining 5.8% is held by non-controlling interest holders.
Shareholder Breakdown
The following table summarizes the ownership structure as of September 25, 2024:
| Shareholder Type | Ownership Percentage |
|---|---|
| Shake Shack Inc. | 94.2% |
| Non-Controlling Interest Holders | 5.8% |
| Total | 100.0% |
Class A and Class B Common Stock
Shake Shack's common stock consists of Class A and Class B shares. As of September 25, 2024, the total shares outstanding include:
| Class | Shares Outstanding | Ownership Type |
|---|---|---|
| Class A Common Stock | 39,966,973 | Public Investors |
| Class B Common Stock | 2,487,936 | Insiders |
Recent Share Activity
During the thirteen weeks ended September 25, 2024, the following activity was noted regarding LLC interests:
| Activity Type | Number of LLC Interests |
|---|---|
| LLC Interests received by Shake Shack Inc. | 28,338 |
| LLC Interests redeemed by non-controlling interest holders | 31,778 |
Financial Performance Highlights
In the thirteen weeks ended September 25, 2024, Shake Shack reported a net loss attributable to Shake Shack Inc. of $10,211,000. Below is a summary of financial performance metrics:
| Metric | Value |
|---|---|
| Net Income (Loss) | $(10,211,000) |
| Total Revenue | $316,924,000 |
| Shack Sales | $304,897,000 |
| Licensing Revenue | $12,027,000 |
Market Position and Future Growth
As of September 25, 2024, Shake Shack operates 552 Shacks globally, with 310 being company-operated and 242 licensed. The company continues to expand, having opened 39 new Shacks in the year leading up to this date.
Conclusion of Ownership Structure
Shake Shack Inc. remains the dominant shareholder in its operating entity, SSE Holdings, with a majority ownership that allows it to consolidate financial results and manage operational strategies effectively.
Shake Shack Inc. (SHAK) Mission Statement
Mission Statement Overview
Shake Shack Inc. aims to stand out in the fast-casual dining segment by offering high-quality, delicious food in a vibrant and welcoming atmosphere. The company emphasizes using fresh, carefully sourced ingredients, and strives to create a positive impact in the communities it serves.
Core Values
- Quality: Commitment to using premium ingredients and maintaining high standards in food preparation.
- Community: Engaging with local communities through various initiatives and partnerships.
- Innovation: Continuously enhancing the menu and dining experience to meet customer expectations.
- Sustainability: Focused on environmentally responsible practices in sourcing and operations.
Financial Highlights (Q3 2024)
As of September 25, 2024, Shake Shack has demonstrated robust financial performance, reflecting its commitment to growth and operational excellence. Below are key financial metrics:
| Metric | Value (Thirteen Weeks) | Value (Thirty-Nine Weeks) |
|---|---|---|
| Shack Sales | $304.9 million | $890.9 million |
| Licensing Revenue | $12.0 million | $33.0 million |
| Total Revenue | $316.9 million | $923.9 million |
| Net Income (Loss) Attributable to Shake Shack Inc. | $(10.2) million | $1.5 million |
| Average Weekly Sales | $76,000 | $75,000 |
| Same-Shack Sales Growth | 4.4% | 3.4% |
Expansion and Growth Strategy
Shake Shack has been expanding its footprint, with 39 new company-operated Shacks opened between September 27, 2023, and September 25, 2024. This expansion strategy is integral to achieving its mission of becoming a leading global fast-casual brand.
Digital Sales Performance
Digital sales have also shown significant growth, underscoring Shake Shack's adaptability to changing consumer preferences:
| Metric | Value (Thirteen Weeks) | Value (Thirty-Nine Weeks) |
|---|---|---|
| Digital Sales | $104.3 million | $312.6 million |
| Percentage of Shack Sales | 34.2% | 35.1% |
Community Engagement
Shake Shack continues to prioritize community engagement through various initiatives. The company actively participates in charitable events and supports local projects, reinforcing its mission to be a responsible corporate citizen.
Conclusion
Shake Shack Inc.'s mission statement encapsulates its dedication to quality food, community involvement, and sustainable practices. The company's ongoing growth and commitment to customer satisfaction position it well in the competitive fast-casual dining landscape.
How Shake Shack Inc. (SHAK) Works
Business Overview
Shake Shack Inc. operates a fast-casual restaurant chain known for its burgers, hot dogs, fries, and shakes. As of September 25, 2024, Shake Shack had 552 Shacks operational worldwide, comprising 310 Company-operated and 242 licensed locations.
Financial Performance
For the thirteen weeks ended September 25, 2024, Shake Shack reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Shack Sales | $304.9 million | $265.0 million | +15.1% |
| Total Revenue | $316.9 million | $276.2 million | +14.8% |
| Net Income (Loss) | $(11.1) million | $8.1 million | -237.1% |
| Earnings (Loss) per Share (Diluted) | $(0.26) | $0.19 | -236.8% |
Operational Metrics
Key operational metrics for the same period included:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| System-wide Sales | $495.1 million | $439.1 million |
| Same-Shack Sales Growth | 4.4% | 3.2% |
| Average Weekly Sales | $76,000 | $74,000 |
Revenue Composition
Revenue for the thirteen weeks ended September 25, 2024, was composed of:
| Revenue Type | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Shack Sales | $304.9 million | $265.0 million | +15.1% |
| Licensing Revenue | $12.0 million | $11.2 million | +7.1% |
Cost Structure
Shake Shack's key expenses for the thirteen weeks ended September 25, 2024, included:
| Expense Type | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Food and Paper Costs | $86.1 million | $77.2 million | +11.5% |
| Labor and Related Expenses | $85.5 million | $76.2 million | +12.2% |
| Other Operating Expenses | $45.6 million | $37.3 million | +22.1% |
| Occupancy and Related Expenses | $23.6 million | $20.3 million | +16.3% |
| General and Administrative Expenses | $35.7 million | $30.9 million | +15.4% |
Growth Initiatives
During the thirteen weeks ended September 25, 2024, Shake Shack opened eight new Company-operated Shacks and nine licensed Shacks. The company plans to continue expanding its footprint, emphasizing both domestic and international growth.
Digital Sales
Digital sales for the thirteen weeks ended September 25, 2024, reached:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Digital Sales | $104.3 million | $83.2 million | +25.4% |
| Digital Sales as % of Shack Sales | 34.2% | 31.3% | +2.9% |
Liquidity Position
As of September 25, 2024, Shake Shack maintained cash and cash equivalents of:
| Metric | Amount |
|---|---|
| Cash and Cash Equivalents | $310.9 million |
| Convertible Notes | $250 million |
Conclusion
Shake Shack continues to expand its operational footprint while managing costs and adapting to market dynamics. The company's focus on digital sales and new openings positions it for future growth.
How Shake Shack Inc. (SHAK) Makes Money
Shack Sales
Shack sales represent the aggregate sales of food, beverages, and Shake Shack branded merchandise at Company-operated Shacks. As of September 25, 2024, Shack sales were:
| Period | Shack Sales (in thousands) | Percentage of Total Revenue | Dollar Change | Percentage Change |
|---|---|---|---|---|
| Thirteen Weeks Ended September 25, 2024 | $304,897 | 96.2% | $39,917 | 15.1% |
| Thirty-Nine Weeks Ended September 25, 2024 | $890,929 | 96.4% | $119,885 | 15.5% |
The increase in Shack sales was primarily driven by the opening of new Shacks and increased menu prices. Specifically, 39 new Company-operated Shacks opened between September 27, 2023, and September 25, 2024, contributing approximately $72 million to sales.
Licensing Revenue
Licensing revenue includes initial territory fees, Shack opening fees, and ongoing sales-based royalty fees. For the same periods, licensing revenue was as follows:
| Period | Licensing Revenue (in thousands) | Percentage of Total Revenue | Dollar Change | Percentage Change |
|---|---|---|---|---|
| Thirteen Weeks Ended September 25, 2024 | $12,027 | 3.8% | $800 | 7.1% |
| Thirty-Nine Weeks Ended September 25, 2024 | $32,995 | 3.6% | $2,749 | 9.1% |
The increase in licensing revenue was attributed to the opening of 27 net new licensed Shacks and higher sales at existing licensed Shacks.
Digital Sales
Digital sales, including orders from the Shake Shack app, website, and third-party delivery platforms, showed significant growth:
| Period | Digital Sales (in thousands) | Percentage of Shack Sales | Percentage Change |
|---|---|---|---|
| Thirteen Weeks Ended September 25, 2024 | $104,300 | 34.2% | 25.4% |
| Thirty-Nine Weeks Ended September 25, 2024 | $312,600 | 35.1% | 20.4% |
Cost Structure
Shake Shack's cost structure includes various operational expenses that impact its profitability:
| Expense Type | Thirteen Weeks Ended September 25, 2024 (in thousands) | Thirty-Nine Weeks Ended September 25, 2024 (in thousands) |
|---|---|---|
| Food and Paper Costs | $86,056 | $251,362 |
| Labor and Related Expenses | $85,523 | $253,646 |
| Other Operating Expenses | $45,564 | $131,373 |
| Occupancy and Related Expenses | $23,608 | $69,022 |
| General and Administrative Expenses | $35,691 | $107,948 |
| Depreciation and Amortization Expense | $25,722 | $76,659 |
The total expenses for the thirteen weeks ended September 25, 2024, were $334,912, while for the thirty-nine weeks, they totaled $931,096.
Net Income (Loss)
Shake Shack reported a net loss for the periods ended September 25, 2024:
| Period | Net Income (Loss) (in thousands) |
|---|---|
| Thirteen Weeks Ended September 25, 2024 | $(11,109) |
| Thirty-Nine Weeks Ended September 25, 2024 | $1,487 |
This resulted in a loss attributable to Shake Shack Inc. of $(10,211) for the thirteen weeks.
Outlook and Expansion
As of September 25, 2024, Shake Shack operated 552 Shacks, with plans for continued expansion. The company opened eight new Company-operated Shacks and nine new licensed Shacks during the thirteen weeks ended September 25, 2024.
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Article updated on 8 Nov 2024
Resources:
- Shake Shack Inc. (SHAK) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Shake Shack Inc. (SHAK)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Shake Shack Inc. (SHAK)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.