Shake Shack Inc. (SHAK): Business Model Canvas [Dec-2025 Updated]

You're looking at the Shake Shack Inc. playbook as they push toward a $1.45 billion revenue target, and what stands out is the clear, aggressive pivot to digital scale. Honestly, this isn't just about burgers anymore; their App and Kiosks are now driving roughly 80% of sales, supporting an expansion plan to open 45-50 new Company-operated Shacks in FY2025. Still, that commitment to premium quality-like their 100% Angus beef-means costs are tight, with Food and Paper Costs hitting 28.2% of Shack sales in Q2 2025. Below, we map out the nine building blocks of this high-growth, high-quality model.

Shake Shack Inc. (SHAK) - Canvas Business Model: Key Partnerships

You're looking at how Shake Shack Inc. builds its moat through strategic alliances, which is crucial as they push toward their ambitious goal of reaching at least 1,500 company-operated locations long-term, up from 329 as of late 2024. These partnerships are not just about volume; they are about maintaining that premium, fine-casual feel while scaling.

Global Licensing Partners

The international footprint relies heavily on operationally experienced licensees. Shake Shack granted exclusive rights to partners in specific countries, and they are not pursuing additional agreements in those territories. As of early 2025, the brand had over 200 international locations. By May 2025, the licensed locations count reached 256 across 20 countries. The company is focused on accelerating this licensed business as one of its six strategic priorities for 2025.

• Exclusive licensing rights granted in 17 countries, including China, Japan, Mexico, and the United Kingdom.
• Licensed openings for 2025 were projected to range from 40 to 45 new sites.
• The total systemwide unit count reached 589 as of Q1 2025.

Third-Party Delivery Providers

To meet guests where they are, Shake Shack Inc. integrates with major third-party delivery platforms, which helped drive growth in the UK operations, which bounced back to profit in 2024. While they also process delivery through their own Shack App or website powered by Uber Direct, they list several aggregators for broader reach.

• Confirmed partnerships include Uber Eats, which is also key to their Delta Air Lines promotion.
• The delivery network also utilizes Deliveroo and Just Eat, though market consolidation in 2025 saw Just Eat sold to Prosus and Deliveroo sold to DoorDash.

Strategic Brand Collaborations

You see the premium positioning reinforced through high-profile collaborations. The partnership with Delta Airlines is a prime example, bringing the Shake Shack Cheeseburger to First Class passengers on domestic flights over 900 miles. This collaboration expanded to major hubs like Atlanta and Los Angeles starting March 4, 2025. Honestly, the customer response has been fantastic; over 10,000 Shake Shack meals were served out of Boston since the initial launch in December 2024.

Real Estate Developers for New Drive-Thru Formats

The growth strategy involves a significant shift toward suburban markets and formats that offer convenience, which means partnering with developers open to non-traditional footprints. Shake Shack Inc. had about 39 drive-thru locations as of January 2025. They planned to open 80 to 85 new restaurants systemwide in 2025, with about 45 being company-operated, prioritizing these smaller, drive-thru sites to reduce costs. A suburban drive-thru that opened in Q1 2025 even set a record for opening-day sales.

Premium, Ethical Ingredient Suppliers

The commitment to quality is non-negotiable, especially regarding the beef. Shake Shack Inc. mandates its beef is 100% all-natural Angus beef, freshly ground, with no added hormones and no added antibiotics ever. For US locations, the longtime beef purveyor is noted as Pat LaFrieda Meat Purveyors. This focus on ethical sourcing, including humane treatment of cattle, supports their premium brand identity.

Here's a quick look at some of the key operational and partnership metrics as of 2025 data points:

Metric Category	Key Data Point	Value/Amount
Total Systemwide Locations (Q1 2025)	Total Shacks Systemwide	589
International Reach	Licensed Locations (as of May 2025)	256
2025 Expansion Target	Planned New Restaurant Openings (2025)	80 to 85
Real Estate Format Focus	Current Drive-Thru Locations (Jan 2025)	39
Strategic Collaboration Impact	Delta Partnership Meals Served (from Boston)	Over 10,000
Ingredient Quality Standard	Beef Sourcing Claim	100% Angus beef, No hormones/antibiotics ever

Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Key Activities

You're looking at the core engine driving Shake Shack Inc.'s growth right now, which is all about aggressive scaling while simultaneously tightening up the kitchen. Honestly, the numbers show they are pushing hard on expansion while fighting inflation in the background.

Aggressive Unit Expansion

Shake Shack Inc. is executing its largest development class on record, which is a major Key Activity. The plan for fiscal year 2025 is to open 45-50 Company-operated Shacks. This is part of a larger system-wide goal, targeting 80-90 total system-wide unit openings for FY2025. To give you a sense of the pace, in the third quarter of 2025 alone, they opened 13 new Company-operated Shacks and seven new licensed Shacks. This relentless pace is aimed at reaching a long-term target of 1,500 company-operated locations. The total restaurant count at the end of Q3 2025 stood at 630 locations.

Metric	FY2025 Target/Guidance	Q3 2025 Actual
Company-Operated Shack Openings	45-50	13 (in Q3)
System-Wide Unit Openings (Total Target)	80-90	20 (13 Co-op + 7 Licensed in Q3)
Total Locations (End of Q3 2025)	N/A	630

Optimizing Restaurant Operations for Faster Service

To support this growth and improve the guest experience, operational efficiency is a huge focus. They are using a new activity-based labor model to drive accountability. This is showing up in service times and sales per unit. For instance, the speed of service improved to approximately 5m50s in Q3 2025, a big jump from the ~7m seen in 2023. This efficiency helped drive a 24.9% labor cost as a percentage of Shack sales in Q3 2025, which is a 310 bps year-over-year improvement. Also, Average Weekly Sales (AWS) for company-operated Shacks hit $78,000 in Q3 2025, up 2.6% year-over-year.

The result of these operational pushes, combined with menu strategy, was strong same-Shack sales growth.

• Same-Shack Sales (SSS) Growth (Q3 2025): 4.9% year-over-year.
• SSS Acceleration: A 390 basis point improvement compared to the first half of 2025 run rate.
• Restaurant-Level Profit Margin (Q3 2025): 22.8% of Shack sales, an 180 bps year-over-year improvement.

Developing a Comprehensive Loyalty Program for 2026 Launch

While the prompt mentions a 2026 launch, Shake Shack Inc. actually began rolling out its first-ever loyalty program in stages starting in May 2025, designed to build the foundation for sustained digital engagement. This program is heavily gamified and lives on their digital channels, which already account for nearly 40% of total sales. The initial phases focused on driving frequency through specific purchase tasks, which is a key activity to shift customer behavior from 'special occasion' to repeat visits.

Here are the initial mechanics of the program, which sets the stage for whatever they plan for 2026:

• Initial Offer ('Shake Hack'): $1 small or large sodas, available via app/web only.
• First Loyalty Phase ('Challenges'): Launched June 5, 2025.
• Example Challenge Reward: Order any burger on two separate occasions within 30 days to unlock $10 off the next visit.
• LTO-Tied Challenge: Order any BBQ sandwich on two separate visits before Aug. 6 to unlock $5 off.

Culinary Innovation and Limited Time Offer (LTO) Development

Keeping the menu fresh is a constant activity, especially to drive those same-Shack sales. The culinary team is focused on both premium, buzz-worthy items and LTOs that support the loyalty program challenges. The Dubai Chocolate Pistachio Shake and fried pickles side were noted innovations. The Summer BBQ LTO platform was also a focus, directly tied into a loyalty challenge in Q3 2025. In Q2 2025, the Dubai Chocolate Pistachio Shake alone contributed 1 percentage point of growth in same-Shack sales.

Managing a Complex, High-Quality Supply Chain

Maintaining the premium quality standard while expanding rapidly requires intense supply chain management, especially given commodity volatility. This is a critical activity where they are actively seeking efficiencies to offset inflation. For instance, supply chain optimizations helped reduce new Shack build costs by at least 10% in 2025. However, managing input costs remains a challenge; Q3 2025 Food & Paper Costs were 29.3% of Shack sales, an increase of 110 bps YoY, driven by mid-teens beef inflation during that quarter. Management is guiding for FY2025 Food and Paper Inflation to be in the positive low single digits, with beef costs up mid- to high single digits for the full year.

The long-term goal tied to supply chain and operational improvements is to grow restaurant profit margins by at least 50 basis points annually over the next three years.

Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Key Resources

You're looking at the core assets that power Shake Shack Inc.'s current market position as of late 2025. These aren't just line items on a balance sheet; they are the engines driving their premium fast-casual growth strategy.

Strong brand equity and 'Enlightened Hospitality' culture

The brand's equity is evidenced by its ability to drive comparable sales growth even amid general consumer caution. For the third quarter of 2025, Same-Shack sales were up 4.9% versus 2024. This culture underpins operational success, as reflected in the Q3 2025 Restaurant-level profit margin of 22.8% of Shack sales. The company's strategic priorities, which include building a culture of leaders and driving comp sales by increasing guest frequency, are central to maintaining this premium positioning.

Digital technology platform (App, Kiosks) driving ~80% of sales

While the target of 80% is ambitious, the latest reported figures show significant digital adoption. In the first quarter of 2025, digital sales accounted for 38% of revenue, which was an increase of 130 basis points year-over-year. The company is investing in technology infrastructure, specifically kiosks and digital channels, which have driven positive check growth. This digital ecosystem is key to reaching their goal of increasing guest frequency.

Global real estate footprint of over 645 system-wide locations

Shake Shack Inc. is executing an aggressive expansion plan, aiming for substantial unit growth. The company opened 13 new Company-operated Shacks and seven new licensed Shacks in the third quarter of 2025 alone, totaling 20 new locations that quarter. The long-term domestic Company-operated footprint target has been raised to at least 1,500 Shacks. As of early 2025, the system-wide count was over 550 locations. The plan for 2025 included opening 80 to 85 new restaurants system-wide.

Here's a quick look at the scale and digital mix based on recent reporting:

Metric	Value/Percentage	Reporting Period/Context
Total System-Wide Locations (Approximate)	Over 630	End of Q3 2025 (Implied from openings and prior reports)
Company-Operated Locations (U.S. Early 2025)	Roughly 330	Early 2025
International Locations (Early 2025)	Over 200	Early 2025
Digital Sales Contribution	38%	Q1 2025 Revenue
Total Revenue	$367.4 million	Q3 2025

High-quality, premium ingredient sourcing network

The commitment to quality is non-negotiable, which requires a robust, vetted sourcing network. Management has stated they have a thorough testing process for new suppliers to ensure they meet specifications. However, this resource is currently under pressure; the company is experiencing mid-teens inflation in the beef market, which remains a significant cost headwind. Maintaining this network's integrity is critical to justifying the premium price point.

Experienced leadership team driving operational efficiency

The leadership team, under CEO Rob Lynch (appointed in 2024), has focused on operational discipline. This focus is yielding results, with the company successfully implementing a new labor model that helped reduce labor costs to 28% of Shack sales in Q1 2025. The team is actively managing transitions; CFO Katherine Fogertey is set to transition to a Senior Adviser role in March 2026, with an interim "Office of the CFO" established to ensure continuity. New executive roles, like Chief Growth Officer and Chief Communications Officer, were added in early 2025 to support the next growth phase.

The operational improvements are translating directly to the bottom line:

• Restaurant-level profit margin reached 22.8% of Shack sales in Q3 2025.
• Operating income swung to a profit of $18.5 million in Q3 2025, compared to an $18.0 million loss in Q3 2024.
• Adjusted EBITDA for Q3 2025 was $54.1 million, up 18.2% versus 2024.

Finance: draft the Q4 2025 cash flow projection by next Tuesday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Shake Shack over the competition, even when budgets feel tight. It's not just about a burger; it's about the whole package, backed by some solid numbers from late 2025.

Premium, high-quality American classics (fine-casual positioning)

You see this in the sales figures. The brand commands pricing power, reflected in the full-year 2025 outlook where in-Shack menu prices were planned to be up about ~2% year-over-year, with overall prices up around ~3%. This premium positioning supports a target Average Unit Volume (AUV) in the range of $2.8 million - $4.0 million for new units. The quality keeps driving comparable sales; Same-Shack sales were up 4.9% in the third quarter of 2025 versus 2024, and July 2025 saw a 3.2% same-Shack sales growth.

Speed and convenience via digital ordering and drive-thrus

Digital is a huge part of the value now. In the first quarter of 2025, digital sales accounted for 38% of total revenue. The focus on drive-thrus is paying off in efficiency; with digital menu boards in drive-thrus, order times were slashed by 15% at tested locations. That's real time saved for you.

'Enlightened Hospitality' customer experience

This philosophy translates directly into operational profitability, which is a key value proposition for the business itself, allowing it to maintain quality. Restaurant-level profit margin hit 22.8% of Shack sales in Q3 2025. To be fair, Q1 2025 saw a margin of 20.7% of Shack sales, showing some fluctuation, but the overall trend is toward strong unit-level performance.

Commitment to ethical sourcing and community investment

The brand backs its premium claim with sourcing standards. Shake Shack sources its beef from U.S. ranchers who provide 100% all-natural, no added hormones, and antibiotic-free beef, which is third-party audited for animal welfare. On the social side, the company earned a 100% score on the Human Rights Campaign's Corporate Equality Index. In 2024, charitable giving nearly doubled, contributing close to half a million dollars.

Menu price resilience due to premium brand loyalty

While the specific 88% retention figure isn't showing up in the latest data, loyalty is clearly being built through frequency. In the first half of 2025, Shake Shack posted modest monthly gains in repeat visitation, achieving between 10.5% to 11.4% repeat monthly visitors. This is what allows them to maintain price points. Here's a snapshot of some of those key performance indicators:

Metric Category	Specific Metric	Latest Reported Value (2025 Data)
Digital Adoption	Digital Sales as % of Revenue (Q1 2025)	38%
Operational Efficiency	Drive-Thru Order Time Reduction (Test)	15%
Profitability	Restaurant-Level Profit Margin (Q3 2025)	22.8%
Growth/Pricing Power	Same-Shack Sales Growth (Q3 2025)	4.9%
Loyalty/Frequency	Repeat Monthly Visitors (H1 2025 Range)	10.5% to 11.4%
Sourcing Standard	Beef Sourcing Claim	100% all-natural, no added hormones, antibiotic-free

You can see the value proposition is a blend of premium quality and modern convenience, which supports the financial results you see in the margins and comparable sales.

• Premium ingredients: Beef is 100% third-party audited.
• Digital integration: 38% of revenue from digital channels in Q1 2025.
• Community support: Charitable giving nearly doubled in 2024, reaching close to $500,000.
• Unit Economics: Target AUV range of $2.8 million - $4.0 million.

Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Customer Relationships

You're focused on how Shake Shack Inc. (SHAK) keeps its guests coming back, which is critical when same-Shack sales growth is a key performance indicator. The relationship strategy is a blend of high-tech efficiency and high-touch culture.

Digital-first engagement via the Shack App and self-service kiosks

The digital ecosystem is central to modern ordering, making the Shack App and in-store kiosks essential touchpoints. As of the first quarter of 2025, digital sales accounted for 38% of total revenue, showing a strong shift in how guests interact with the brand. This digital penetration is a deliberate move to capture data and streamline service. For instance, one estimate suggests approximately 2,333 people were downloading Shake Shack's mobile apps on a daily basis in 2025. The self-service kiosks are noted as comprising its largest ordering channel, complementing the mobile experience.

Here's a look at the digital engagement metrics we have:

Metric	Value (Latest Reported)	Period Context
Digital Sales as Percentage of Revenue	38%	Q1 2025
Estimated Daily App Downloads	2,333	2025 Estimate
Same-Shack Sales Growth	4.9%	Q3 2025

Developing a systematic loyalty program to increase frequency

Shake Shack Inc. moved to formalize loyalty in 2025, addressing a gap compared to some peers. The company introduced its first systematic loyalty offering, dubbed "Challenges," beginning on June 5, 2025. This program is designed to directly influence visit frequency, which is a stated strategic priority. The initial incentive deployed was a \$1 soda offer, branded as a "Shake Hack," with more deals planned to follow. Test runs of loyalty offerings indicated that the program successfully led customers to visit more often than they otherwise would have.

• Loyalty program is designed to drive guest frequency.
• Initial offer was a \$1 soda for app users.
• Program aims to build on success of digital channels.

High-touch, in-Shack service based on 'Enlightened Hospitality'

The foundational relationship strategy remains the culture of "Enlightened Hospitality," which focuses on taking care of team members so they can take care of guests. This philosophy underpins the in-Shack experience. Operational improvements, including a new labor model, have directly impacted guest metrics. In the second quarter of 2025, the restaurant-level profit margin reached 23.9% of Shack sales, supported by significantly improved speed of service. By the third quarter of 2025, the restaurant-level profit stood at 22.8% of Shack sales, demonstrating sustained operational discipline supporting the guest experience.

Data-driven personalization of offers within the app ecosystem

The heavy reliance on digital channels provides the data backbone for personalization. With 38% of transactions flowing through digital means as of early 2025, Shake Shack Inc. gains significant visibility into guest behavior. This data visibility is used to refine menu board layouts and tailor offers. The loyalty program itself, which offers surprise perks for repeat engagement, is an execution of this data-driven approach, moving beyond simple transactions to recognize and reward specific guest patterns.

Community-focused local marketing and events

Marketing efforts are often tied to culinary innovation to drive local buzz and traffic. For example, limited-time offers (LTOs) like the Dubai Chocolate Pistachio Shake generated social media buzz and supported traffic in key markets. The overall Same-Shack sales growth of 4.9% in the third quarter of 2025 reflects the success of these integrated efforts, which blend digital promotion with in-store experience and product excitement. The company also focuses on community investment as part of its purpose to Stand For Something Good®.

Shake Shack Inc. (SHAK) - Canvas Business Model: Channels

You're looking at how Shake Shack Inc. gets its product into customers' hands as of late 2025. The strategy is clearly a mix of physical presence and digital integration, leaning heavily on technology to drive volume and margin.

The physical footprint continues to expand, moving beyond the initial urban core focus. As of the third quarter of 2025, Shake Shack Inc. operated over 630 locations system-wide. This network is split between direct control and partnerships.

Channel Type	Count/Metric	Date/Period Reference
Company-operated Shacks (US)	405	As of Q3 2025
Company-operated Shacks Opened in Q3 2025	13 new units	Q3 2025
Company-operated Shacks Opened in FY 2024	43 new units	FY 2024
Licensed Shacks (International/Non-Traditional)	Over 225 international locations	As of Q3 2025
Licensed Shacks Opened in Q3 2025	7 new units	Q3 2025
Total Licensed Shacks Opened in FY 2024	33 new units	FY 2024
Total System-wide Locations	Over 630	As of Q3 2025
Drive-Thru Locations	About 39	Early 2025

The revenue generated directly from the company-operated Shacks in the third quarter of 2025 was $352.8 million, while Licensing revenue for the same period was $14.6 million. The restaurant-level profit margin on those Shack sales hit 22.8% in Q3 2025.

Digital ordering is a massive part of the throughput now. Shake Shack Inc. has successfully integrated multiple digital touchpoints to capture off-premise and in-store convenience orders. Honestly, the numbers show this is where a lot of the efficiency gains are coming from.

• Total Digital Sales (Kiosks, Web, App, Delivery) account for approximately 80% of overall sales.
• Self-service kiosks are the single largest in-Shack ordering channel, generating over 50% of in-Shack sales.
• The proprietary Shack App and website facilitate mobile ordering, feeding into the integrated digital sales pool.
• Third-party delivery platforms are a key component of the off-premise sales mix, contributing to the 80% total digital figure.

The focus on kiosks specifically is driving margin; they are noted as a high-margin channel because they help reduce front-of-house labor hours, which supports the goal of achieving restaurant-level margins of approximately 22% for fiscal year 2025. Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Customer Segments

You're looking at the core groups Shake Shack Inc. is targeting as they push toward their long-term goal of at least 1,500 company-operated Shacks over time. It's not just about selling burgers; it's about capturing specific dining occasions and demographics with a premium offering.

Affluent, urban, and suburban fast-casual diners

This segment is the traditional base, often found in dense urban centers but increasingly being reached in the suburbs. The brand's premium positioning-using high-quality ingredients-supports a higher average check, which is necessary for the target unit economics. For instance, the company is actively expanding into underpenetrated suburban markets like Texas, Florida, and the Midwest, aiming to capture that growing suburban demand. The overall system-wide unit count is growing fast, with plans to open 80 to 85 new restaurants in fiscal 2025, including about 45 company-operated locations. The long-term vision is to more than quadruple the domestic company-operated footprint from its 2015 target of 450 sites.

Digital-savvy customers prioritizing convenience and speed

These diners rely on technology for ordering and pickup, and Shake Shack Inc. is clearly leaning into this. Digital sales are a major component of their strategy, accounting for 38% of total revenue as of the first quarter of 2025. That's a year-over-year increase of 130 basis points in Q1 2025 alone. Management is using digital activations and testing digital menu boards in drive-thrus to cut order times, which helps reinforce the value proposition for this convenience-focused group.

International consumers in high-growth, underpenetrated markets

The global footprint is significant and a key driver of growth outside the saturated US markets. As of early 2025, Shake Shack Inc. operated over 200 international locations, spanning cities like London, Hong Kong, Shanghai, Dubai, and Tokyo. The licensed business is accelerating, with licensed revenue growing 20.2% year-over-year in Q2 2025. This segment is crucial for diversifying revenue, as evidenced by Q3 2025 licensing revenue hitting $14.6 million.

Customers valuing premium ingredients and conscious dining choices

This group is attracted by the brand's stated purpose to 'Stand For Something Good®,' which encompasses premium ingredients and community investment. They are the ones responding to culinary innovation, like the buzz generated by limited-time offerings (LTOs) such as the Dubai Chocolate Pistachio Shake. These premium items, paired with modest pricing strategies-in-Shack pricing expected to rise only 2% year-over-year for 2025-help maintain the brand's quality perception while managing inflation. The focus on operational discipline also helps maintain profitability, with restaurant-level profit margins reaching 23.9% in Q2 2025.

Younger consumers seeking a modern, elevated dining experience

Younger diners often overlap with the digital-savvy segment but are also highly influenced by modern design and social media trends. The brand's modern aesthetic and focus on 'Enlightened Hospitality' are designed to resonate with this demographic. The loyalty program, featuring 'Challenges,' is a direct play to increase guest frequency among this group, offering exclusive perks for engagement. The overall system-wide sales growth, reaching $549.9 million in Q2 2025, reflects successful engagement across all channels, including the younger base.

Here's a quick look at some key operational metrics that reflect how Shake Shack Inc. is serving these segments through late 2025:

Metric	Value/Period	Context
Digital Sales Percentage	38%	Q1 2025 Revenue Share
Total System-Wide Locations	Over 550	As of early 2025
Projected 2025 Total Revenue	$1.4 billion - $1.5 billion	Full Year 2025 Guidance
Q3 2025 Same-Shack Sales Growth	4.9%	Year-over-year growth
Target 2025 Restaurant-Level Margin	Approximately 22%	Full Year Guidance

The success in driving traffic and sales is reflected in the recent performance metrics:

• Q3 2025 Total Revenue was $367.4 million.
• Q2 2025 Net Income reached $18.5 million.
• The company opened 13 new Company-operated Shacks and seven new licensed Shacks in Q3 2025.
• Labor & Related Expenses were 28% of Shack sales in Q1 2025, down 110 basis points YoY.
• The long-term target for Average Unit Volume (AUV) is in the range of $2.8 million - $4.0 million.

These numbers show you the scale of the customer base they are managing and growing. Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Shake Shack Inc.'s operations, which is key to understanding their profitability, especially as they scale. The cost structure is heavily weighted toward the direct costs of running a restaurant, but there are also significant investments in future growth.

The Food and Paper Costs are a major line item, which is typical for a premium fast-casual concept. For the second quarter of 2025, these costs hit $96.6 million, representing 28.2% of Shack sales. This percentage was up 40 basis points versus the prior year, largely due to a mid-single-digit increase in beef costs.

Then there's Labor and Related Expenses. In Q2 2025, this category totaled $88.1 million, making up 25.7% of Shack sales. Honestly, seeing this percentage down 270 basis points year-over-year is a testament to their new labor guides and operational model adherence. That's real money saved through efficiency.

Here's a quick look at the main Shack-level operating expenses from Q2 2025, so you can see the relative weight of each component:

Expense Category	Amount (Millions USD)	% of Shack Sales
Food and Paper Costs	96.6	28.2%
Labor and Related Expenses	88.1	25.7%
Other Operating Expenses	50.8	14.8%
Occupancy and Related Expenses	25.6	7.5%

When you look at the full picture of Shack-level expenses, you see the other necessary costs of doing business:

• Other operating expenses were $50.8 million, or 14.8% of Shack sales, driven up by marketing and digital mix investments.
• Occupancy and related expenses were $25.6 million, or 7.5% of Shack sales, showing a slight decrease year-over-year.

Moving beyond day-to-day operations, significant capital expenditure for new unit build-outs is a constant drain, but it's the cost of their growth strategy. The company is targeting 45 to 50 company-operated openings for the full fiscal year 2025. While they streamlined build costs by 10% in 2025, the net build costs for a new Shack are still estimated to be in the range of $1.5 million - $3.0 million, not including real estate.

The pre-opening costs associated with these new Shacks are also material. For the full fiscal year 2025, Shake Shack Inc. expects pre-opening costs to be approximately $19 million. To be fair, Q2 2025 alone saw 13 new company-operated openings, resulting in pre-opening costs of $5 million for that quarter.

Finally, there's the General and Administrative (G&A) investment in digital capabilities and corporate overhead. For the full year 2025, G&A expenses are projected to be 12.3% to 12.5% of Total revenue. In Q2 2025, G&A was $40.7 million (or $40.1 million excluding onetime adjustments), with the year-over-year increase reflecting those strategic investments in people and marketing/digital scaling efforts.

Finance: draft 13-week cash view by Friday.

Shake Shack Inc. (SHAK) - Canvas Business Model: Revenue Streams

The revenue streams for Shake Shack Inc. are anchored by direct sales from its restaurants, supplemented by growth from its expanding licensed partnerships. You need to see the composition clearly, so let's break down the numbers from the latest guidance as of late 2025.

Company-operated Shack Sales remain the core driver of the top line. For the third quarter of 2025, these sales hit $352.8 million, representing a 15.7% year-over-year growth. This is the engine of the business, directly tied to same-store performance and new company-owned unit openings.

The licensing segment is a growing contributor, providing a more capital-light revenue source. For the third quarter of 2025, Licensing Revenue was $14.6 million, marking a 21.1% increase over the prior year. For the full Fiscal Year 2025, Shake Shack Inc. reiterated guidance for Licensing Revenue to be in the range of $54.1 million to $54.5 million. This is a solid uptick from the earlier guidance range mentioned in the May 2025 reports.

When you aggregate these streams, the full-year picture is substantial. Shake Shack Inc. reiterated its expectation for Total Revenue for the full year ending December 31, 2025, to be approximately $1.45 billion, reflecting growth of approximately 16% year-over-year.

Here's how the key revenue components stack up based on the most recent full-year guidance and Q3 performance:

Revenue Component	Q3 2025 Actual Amount	FY 2025 Guidance Range
Company-Operated Shack Sales	$352.8 million	Implied from Total Revenue guidance
Licensing Revenue	$14.6 million	$54.1 million to $54.5 million
Total Revenue	$367.4 million	Approximately $1.45 billion

The health of the existing store base is measured by Same-Shack Sales growth (SSS). The company reaffirmed its expectation for SSS growth for the full year 2025 to be a low-single-digit percentage. To give you a concrete example of recent momentum, the third quarter saw Same-Shack Sales grow by 4.9% year-over-year.

Profitability at the store level is a critical metric that flows directly into the overall revenue quality. For the full year 2025, the target for Restaurant-Level Profit Margin is set within a tight band, reflecting operational discipline even with inflationary pressures.

• Restaurant-Level Profit Margin (FY 2025 Guidance): 22.7% to 23%
• Restaurant-Level Profit Margin (Q3 2025 Actual): 22.8% of Shack sales
• Labor and Related Expenses (Q3 2025): 24.9% of Shack sales
• Food and Paper Costs (Q3 2025): 29.3% of Shack sales

The operational improvements are clearly translating to better unit economics, which supports the overall revenue quality. If onboarding takes 14+ days, churn risk rises, but the focus on operational efficiencies is helping maintain these margins.