Operations

Shake Shack beats Q4 earnings despite cold weather, LA fires

Photo: Shake Shack

February 21, 2025

The California wildfires and freezing January temperatures didn't stop customers from visiting their favoriteShake Shacks, according to CEO Rob Lynch, who told shareholders this week that January same-store sales increased 3.7%. The nearly 400-unit chain beat Wall Street's earning estimate by 1 cent with adjusted earnings of 26 cents a share. Q4 revenue rose 14.8% to $328.68 million from $286.24 million, just shy of the analyst estimate of $328.8 million.

"Our same-store-sales percentage trends held in January despite the approximate 150-200 basis points impact from weather and the Los Angeles wildfires, and we have confidence in our strategies to drive continued sales and profitability growth this year," he said in a letter to shareholders.

Shake Shack, which celebrated its 10th year since going public in 2015, opened 76 locations in 2024. The nearly 330-unit brand's long-term goal is to hit 1,500 locations.

"Over the past 14 quarters, we have consistently proven our ability to grow our sales and adjusted EBITDA year-over-year while also making investments in our business to build a strong foundation for the future," Chief Financial Officer Katie Fogertey said. "In 2025, we expect to execute on another great year of mid-teens sales growth, to open approximately 85 Shacks system-wide, to expand our restaurant-level profit margin to approximately 22% and drive adjusted EBITDA growth of 17- 22%."

Financial Highlights for the Fiscal Year 2024:

• Total revenue of $1,252.6 million, up 15.2%, including $1,207.6 million of Shack sales and $45 million of Licensing revenue.
• System-wide sales of $1,922.7 million, up 13%,
• Same-Shack sales up 3.6% versus 2023.
• Operating income of $3 million..
• Restaurant-level profit of $257.9 million, or 21.4% of Shack sales.
• Net income of $10.8 million.
• Adjusted EBITDA(1) of $175.6 million.
• Net income attributable to Shake Shack Inc. of $10.2 million, or earnings of 24 cents per diluted share.