Shake Shack (SHAK) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 results with total revenue of $316.5 million, up 16.5% year-over-year, and system-wide sales of $483.7 million, up 13.5%.

• Same-Shack Sales grew 4.0% year-over-year, driven by a 4.8% increase in price mix, partially offset by a 0.8% decline in guest traffic.

• Opened 12 new company-operated and 11 licensed Shacks, including the first in Canada and three drive-thrus, bringing the total to over 540 system-wide.

• CEO transition completed, with new leadership focused on sales growth, unit expansion, and profitability.

Financial highlights

• Restaurant-level profit margin expanded to 22.0%, and Adjusted EBITDA grew 27.4% to $47.2 million (14.9% of revenue).

• Net income attributable to the company was $9.7 million ($0.23 per diluted share); adjusted pro forma net income was $12.1 million ($0.27 per share).

• Free cash flow reached a record $20.6 million.

• Operating income increased to $10.8 million from $4.7 million year-over-year.

Outlook and guidance

• FY24 revenue guidance: $1.24–$1.25 billion (14–15% growth); Same-Shack Sales to grow low single digits.

• 40 company-operated and 40 licensed Shack openings expected in 2024.

• Restaurant-level profit margins guided at 20.6–21% for FY24, with Adjusted EBITDA of $165–$170 million (25–29% growth).

• Q3 revenue guidance: $311.6–$317 million, with 6–7 company-operated and 7 licensed openings.

• Management expects continued growth through new Shack openings and digital sales expansion.