Shake Shack Inc.

Previous wording

Same-Shack sales for the thirteen weeks ended July 1, 2026 increased 3.5% compared to the same period last year, driven by a 2.0% increase in guest traffic and a 1.5% increase in price mix. Same-Shack sales for the twenty-six weeks ended July 1, 2026 increased 4.0% compared to the same period last year, driven by a 2.3% increase in price mix and a 1.7% increase in guest traffic. For the purpose of calculating same-Shack sales for the thirteen and twenty-six weeks ended July 1, 2026, Shack sales for 296 Shacks were included in the comparable Shack base.

Current wording

Same-Shack sales for the thirteen weeks ended September 30, 2026 increased 2.5% compared to the same period last year, driven by a 1.7% increase in price mix and a 0.8% increase in guest traffic. Same-Shack sales for the thirty-nine weeks ended September 30, 2026 increased 3.5% compared to the same period last year, driven by a 2.1% increase in price mix and a 1.4% increase in guest traffic. For the purpose of calculating same-Shack sales for the thirteen and thirty-nine weeks ended September 30, 2026, Shack sales for 304 Shacks were included in the comparable Shack base.

Previous wording

System-wide sales for the thirteen weeks ended July 1, 2026 increased 13.8% to $625.8 million compared to the same period last year. System-wide sales for the twenty-six weeks ended July 1, 2026 increased 13.9% to $1,184.1 million compared to the same period last year.

Current wording

System-wide sales for the thirteen weeks ended September 30, 2026 increased 12.8% to $644.8 million compared to the same period last year. System-wide sales for the thirty-nine weeks ended September 30, 2026 increased 13.5% to $1,828.9 million compared to the same period last year.

Previous wording

The following tables summarize the Shacks opened and closed during the thirteen and twenty-six weeks ended July 1, 2026.

Current wording

The following tables summarize the Shacks opened and closed during the thirteen and thirty-nine weeks ended September 30, 2026.

Previous wording

The following table summarizes our results of operations for the thirteen and twenty-six weeks ended July 1, 2026 and June 25, 2025:

Current wording

The following table summarizes our results of operations for the thirteen and thirty-nine weeks ended September 30, 2026 and September 24, 2025:

Previous wording

Shack sales for the thirteen weeks ended July 1, 2026 increased 17.5% to $403.4 million versus the same period last year. The increase was primarily due to the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026, which contributed $47.2 million, as well as a 3.5% increase in same-Shack sales.

Current wording

Shack sales for the thirteen weeks ended September 30, 2026 increased 15.6% to $408.0 million versus the same period last year. The increase was primarily due to the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026, which contributed $47.4 million, as well as a 2.5% increase in same-Shack sales.

Previous wording

Shack sales for the twenty-six weeks ended July 1, 2026 increased 16.0% to $757.5 million versus the same period last year. The increase was primarily due to the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026, which contributed $76.4 million, as well as a 4.0% increase in same-Shack sales.

Current wording

Shack sales for the thirty-nine weeks ended September 30, 2026 increased 15.9% to $1,165.5 million versus the same period last year. The increase was primarily due to the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026, which contributed $102.5 million, as well as a 3.5% increase in same-Shack sales.

Previous wording

Licensing revenue for the thirteen weeks ended July 1, 2026 increased 7.1% to $14.2 million versus the same period last year. The increase was primarily due to the opening of 40 new licensed Shacks between June 25, 2025 and July 1, 2026, which contributed $1.3 million, partially offset by decreased sales at existing international licensed Shacks, primarily in the Middle East.

Current wording

Licensing revenue for the thirteen weeks ended September 30, 2026 increased 4.7% to $15.2 million versus the same period last year. The increase was primarily due to the opening of 49 new licensed Shacks between September 24, 2025 and September 30, 2026, which contributed $1.7 million, partially offset by decreased revenue from existing licensed Shacks, and the permanent closure of nine licensed Shacks between September 24, 2025 and September 30, 2026.

Previous wording

Licensing revenue for the twenty-six weeks ended July 1, 2026 increased 10.6% to $26.9 million versus the same period last year. The increase was primarily due to the opening of 40 new licensed Shacks between June 25, 2025 and July 1, 2026, which contributed $2.2 million.

Current wording

Licensing revenue for the thirty-nine weeks ended September 30, 2026 increased 8.4% to $42.1 million versus the same period last year. The increase was primarily due to the opening of 49 new licensed Shacks between September 24, 2025 and September 30, 2026, which contributed $3.5 million.

Previous wording

Food and paper costs for the thirteen weeks ended July 1, 2026 increased 20.3% to $116.3 million versus the same period last year. Food and paper costs for the twenty-six weeks ended July 1, 2026 increased 18.4% to $216.3 million versus the same period last year. The increases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026, which contributed approximately $14.3 million and $22.9 million, respectively, as well as increased commodity costs, mainly beef.

Current wording

Food and paper costs for the thirteen weeks ended September 30, 2026 increased 11.4% to $115.3 million versus the same period last year. Food and paper costs for the thirty-nine weeks ended September 30, 2026 increased 15.9% to $331.6 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026, which contributed approximately $14.0 million and $30.8 million, respectively.

Previous wording

As a percentage of Shack sales, the decreases in Labor and related expenses for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to labor efficiencies and sales leverage, partially offset by increased wages and incremental expenses from the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026 as we accelerate our pipeline and as these Shacks mature.

Current wording

As a percentage of Shack sales, the increase in Labor and related expenses for the thirteen weeks ended September 30, 2026 was primarily due to increased wages and incremental expenses from the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026. As a percentage of Shack sales, the decrease in Labor and related expenses for the thirty-nine weeks ended September 30, 2026 was primarily due to labor efficiencies and sales leverage, partially offset by increased wages and incremental expenses from the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026.

Previous wording

Other operating expenses for the thirteen weeks ended July 1, 2026 increased 24.3% to $63.1 million versus the same period last year. Other operating expenses for the twenty-six weeks ended July 1, 2026 increased 21.8% to $120.6 million versus the same period last year. The increases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to increased transaction costs associated with higher sales, and increased facilities costs.

Current wording

Other operating expenses for the thirteen weeks ended September 30, 2026 increased 22.4% to $65.8 million versus the same period last year. Other operating expenses for the thirty-nine weeks ended September 30, 2026 increased 22.0% to $186.5 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to increased transaction costs associated with higher sales and increased facilities costs.

Previous wording

As a percentage of Shack sales, the increase in Other operating expenses for the thirteen weeks ended July 1, 2026 was primarily due to increased delivery commissions associated with higher delivery sales and increased facilities costs. As a percentage of Shack sales, the increase in Other operating expenses for the twenty-six weeks ended July 1, 2026 was primarily due to increased facilities cost, mainly the timing of repairs and maintenance, and increased transaction costs associated with higher sales.

Current wording

As a percentage of Shack sales, the increases in Other operating expenses for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to increased delivery commissions associated with higher delivery sales and increased facilities costs.

Previous wording

Occupancy and related expenses for the thirteen weeks ended July 1, 2026 increased 17.8% to $30.2 million versus the same period last year. Occupancy and related expenses for the twenty-six weeks ended July 1, 2026 increased 17.1% to $58.8 million versus the same period last year. The increases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026, which contributed approximately $3.2 million and $5.2 million, respectively.

Current wording

Occupancy and related expenses for the thirteen weeks ended September 30, 2026 increased 16.2% to $31.4 million versus the same period last year. Occupancy and related expenses for the thirty-nine weeks ended September 30, 2026 increased 16.8% to $90.2 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026, which contributed approximately $3.3 million and $6.6 million, respectively.

Previous wording

As a percentage of Shack sales, Occupancy and related expenses were flat for the thirteen weeks ended July 1, 2026. As a percentage of Shack sales, the increase in Occupancy and related expenses for the twenty-six weeks ended July 1, 2026 was primarily driven by higher common area maintenance charges.

Current wording

As a percentage of Shack sales, Occupancy and related expenses were flat for the thirteen and thirty-nine weeks ended September 30, 2026.

Previous wording

General and administrative expenses for the twenty-six weeks ended July 1, 2026 increased 25.4% to $101.9 million versus the same period last year. The increase was primarily due to increased investments in marketing initiatives as well as increased wages and other team costs. As a percentage of Total revenue, the increase in General and administrative expenses for the twenty-six weeks ended July 1, 2026 was primarily due to increased investments in marketing and technology initiatives, partially offset by a reduction in performance-based compensation.

Current wording

General and administrative expenses for the thirty-nine weeks ended September 30, 2026 increased 16.9% to $146.9 million versus the same period last year. The increase was primarily due to increased investments in marketing initiatives, increased wages and other team member costs to support our Shack growth and increased investments in technology initiatives. As a percentage of Total revenue, the increase in General and administrative expenses for the thirty-nine weeks ended September 30, 2026 was primarily due to the aforementioned items.

Previous wording

Depreciation and amortization expense for the thirteen weeks ended July 1, 2026 increased 15.7% to $30.7 million versus the same period last year. Depreciation and amortization expense for the twenty-six weeks ended July 1, 2026 increased 12.7% to $59.8 million versus the same period last year. The increases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to incremental depreciation of capital expenditures related to the opening of 61 new Company-operated Shacks between June 25, 2025 and July 1, 2026.

Current wording

Depreciation and amortization expense for the thirteen weeks ended September 30, 2026 increased 21.6% to $32.9 million versus the same period last year. Depreciation and amortization expense for the thirty-nine weeks ended September 30, 2026 increased 15.7% to $92.8 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to incremental depreciation of capital expenditures related to the opening of 69 new Company-operated Shacks between September 24, 2025 and September 30, 2026.

Previous wording

Pre-opening costs for the thirteen weeks ended July 1, 2026 increased 34.0% to $6.6 million versus the same period last year. Pre-opening costs for the twenty-six weeks ended July 1, 2026 increased 65.3% to $13.5 million versus the same period last year. The increases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to increased wages and team costs, occupancy costs, and travel and entertainment expense to support our larger development pipeline which includes more Shacks opened during the thirteen and twenty-six weeks ended July 1, 2026 and Shacks under construction compared to the same prior year periods.

Current wording

Pre-opening costs for the thirteen weeks ended September 30, 2026 increased 50.9% to $7.0 million versus the same period last year. Pre-opening costs for the thirty-nine weeks ended September 30, 2026 increased 60.1% to $20.5 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to increased wages and team costs, occupancy costs and other operating expenses to support our larger development pipeline which includes more Shacks opened during the thirteen and thirty-nine weeks ended September 30, 2026 and Shacks under construction compared to the same prior year periods.

Previous wording

Impairments, loss on disposal of assets, and Shack closures for the thirteen and twenty-six weeks ended July 1, 2026 decreased to $0.4 million and $1.3 million, respectively, versus the same periods last year. The decreases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to the absence of expenses related to the closure of nine Company-operated Shacks in fiscal 2024.

Current wording

Impairments, loss on disposal of assets, and Shack closures for the thirty-nine weeks ended September 30, 2026 decreased $1.6 million to $1.9 million, versus the same period last year. The decrease was primarily due to the absence of expenses related to the closure of nine Company-operated Shacks in fiscal 2024.

Previous wording

Other income, net for the thirteen weeks ended July 1, 2026 decreased to $2.6 million versus the same period last year. Other income, net for the twenty-six weeks ended July 1, 2026 decreased to $5.3 million versus the same period last year. The decreases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to lower dividends.

Current wording

Other income, net for the thirteen weeks ended September 30, 2026 decreased $0.6 million to $2.5 million versus the same period last year. Other income, net for the thirty-nine weeks ended September 30, 2026 decreased $1.1 million to $7.8 million versus the same period last year. The decreases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to lower dividends.

Previous wording

Interest expense for the thirteen weeks ended July 1, 2026 increased 0.9% to $0.6 million versus the same period last year. The increase for the thirteen weeks ended July 1, 2026 was primarily due to an increase in various sales tax audit assessment charges, partially offset by a decrease in finance lease charges related to new financing equipment leases with lower lease liability balances.

Current wording

Interest expense for the thirteen weeks ended September 30, 2026 increased $0.1 million to $0.6 million versus the same period last year. Interest expense for the thirty-nine weeks ended September 30, 2026 increased $0.1 million to $1.7 million versus the same period last year. The increases for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to increases in various sales tax audit assessment charges, partially offset by decreases in finance lease charges related to new financing equipment leases with lower lease liability balances.

Previous wording

Our effective income tax rates for the thirteen weeks ended July 1, 2026 and June 25, 2025 were 25.9% and 25.1%, respectively. Our effective income tax rates for the twenty-six weeks ended July 1, 2026 and June 25, 2025 were 25.8% and 23.2%, respectively. The increases in the effective income tax rates for the thirteen and twenty-six weeks ended July 1, 2026 were primarily driven by a decrease in forecasted pre-tax income compared to the prior year, including the effects of nondeductible tax items and a nonrecurring deferred tax adjustment recognized in the prior-year period.

Current wording

Our effective income tax rates for the thirteen weeks ended September 30, 2026 and September 24, 2025 were 24.0% and 35.2%, respectively. Our effective income tax rates for the thirty-nine weeks ended September 30, 2026 and September 24, 2025 were 24.9% and 28.1%, respectively. The decreases in the effective income tax rates for the thirteen and thirty-nine weeks ended September 30, 2026 were primarily due to state tax rate true-ups recorded in the prior year.

Previous wording

The Company's ownership interest in SSE Holdings is directly related to its share of the taxable income of SSE Holdings. Our weighted average ownership interest in SSE Holdings was 94.3% for the thirteen and twenty-six weeks ended July 1, 2026 and June 25, 2025.

Current wording

The Company's ownership interest in SSE Holdings is directly related to its share of the taxable income of SSE Holdings. Our weighted average ownership interest in SSE Holdings was 94.4% and 94.3%, respectively, for the thirteen weeks ended September 30, 2026 and September 24, 2025 and 94.3% for the thirty-nine weeks ended September 30, 2026 and September 24, 2025.

Previous wording

Net income attributable to non-controlling interests for the thirteen and twenty-six weeks ended July 1, 2026 decreased to $1.2 million versus the same periods last year. The decreases for the thirteen and twenty-six weeks ended July 1, 2026 were primarily due to a decline in net results compared to the same periods last year.

Current wording

Net income attributable to non-controlling interests for the thirty-nine weeks ended September 30, 2026 decreased to $2.5 million versus the same period last year. The decrease was primarily due to a decline in net results compared to the same period last year.

Previous wording

(5)Calculated as a percentage of Total revenue, which was $417.6 million and $784.4 million for the thirteen and twenty-six weeks ended July 1, 2026, respectively, and $356.5 million and $677.4 million for the thirteen and twenty-six weeks ended June 25, 2025, respectively.

Current wording

(5)Calculated as a percentage of Total revenue, which was $423.3 million and $1,207.6 million for the thirteen and thirty-nine weeks ended September 30, 2026, respectively, and $367.4 million and $1,044.8 million for the thirteen and thirty-nine weeks ended September 24, 2025, respectively.

Previous wording

(7)Represents the tax effect of the aforementioned adjustments and pro forma adjustments to reflect corporate income taxes at assumed effective tax rates of 24.8% and 26.8% for the thirteen and twenty-six weeks ended July 1, 2026, respectively, and 23.6% and 23.1% for the thirteen and twenty-six weeks ended June 25, 2025, respectively. Amounts include provisions for U.S. federal income taxes, certain LLC entity-level taxes and foreign withholding taxes, assuming the highest statutory rates apportioned to each applicable state, local and foreign jurisdiction.

Current wording

(7)Represents the tax effect of the aforementioned adjustments and pro forma adjustments to reflect corporate income taxes at assumed effective tax rates of 24.4% and 25.7% for the thirteen and thirty-nine weeks ended September 30, 2026, respectively, and 24.9% and 23.8% for the thirteen and thirty-nine weeks ended September 24, 2025, respectively. Amounts include provisions for U.S. federal income taxes, certain LLC entity-level taxes and foreign withholding taxes, assuming the highest statutory rates apportioned to each applicable state, local and foreign jurisdiction.

Previous wording

Our primary sources of liquidity are cash from operations, cash and cash equivalents on hand, and availability under our Revolving Credit Facility. As of July 1, 2026, we maintained a Cash and cash equivalents balance of $308.0 million. In March 2021, we issued 0% Convertible Senior Notes (“Convertible Notes”), and received $243.8 million of proceeds, net of discounts. Refer to Note 6, Debt, in the accompanying Condensed Consolidated Financial Statements, for additional information relating to our long-term debt.

Current wording

Our primary sources of liquidity are cash from operations, cash and cash equivalents on hand, and availability under our Revolving Credit Facility. As of September 30, 2026, we maintained a Cash and cash equivalents balance of $319.0 million. In March 2021, we issued 0% Convertible Senior Notes (“Convertible Notes”), and received $243.8 million of proceeds, net of discounts. Refer to Note 6, Debt, in the accompanying Condensed Consolidated Financial Statements, for additional information relating to our long-term debt.

Previous wording

In addition, we are obligated to make payments to certain members of SSE Holdings under the Tax Receivable Agreement. As of July 1, 2026, such obligations totaled $246.1 million. Amounts payable under the Tax Receivable Agreement are contingent upon, among other things, (i) generation of future taxable income over the term of the Tax Receivable Agreement and (ii) future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the Tax Receivable Agreement to utilize the tax benefits, then we would not be required to make the related payments under the Tax Receivable Agreement. Although the amount of any payments that must be made under the Tax Receivable Agreement may be significant, the timing of these payments will vary and will generally be limited to one payment per member per year. The amount of such payments is also limited to the extent we utilize the related deferred tax assets. The payments that we are required to make will generally reduce the amount of overall cash flow that might have otherwise been available to us or to SSE Holdings, but we expect the cash tax savings we will realize from the utilization of the related deferred tax assets to fund the required payments.

Current wording

In addition, we are obligated to make payments to certain members of SSE Holdings under the Tax Receivable Agreement. As of September 30, 2026, such obligations totaled $245.4 million. Amounts payable under the Tax Receivable Agreement are contingent upon, among other things, (i) generation of future taxable income over the term of the Tax Receivable Agreement and (ii) future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the Tax Receivable Agreement to utilize the tax benefits, then we would not be required to make the related payments under the Tax Receivable Agreement. Although the amount of any payments that must be made under the Tax Receivable Agreement may be significant, the timing of these payments will vary and will generally be limited to one payment per member per year. The amount of such payments is also limited to the extent we utilize the related deferred tax assets. The payments that we are required to make will generally reduce the amount of overall cash flow that might have otherwise been available to us or to SSE Holdings, but we expect the cash tax savings we will realize from the utilization of the related deferred tax assets to fund the required payments.

Previous wording

For the twenty-six weeks ended July 1, 2026, net cash provided by operating activities was $65.5 million compared to $96.2 million for the twenty-six weeks ended June 25, 2025, a decrease of $30.7 million. The decrease was primarily driven by changes in working capital of $36.2 million, partially offset by a $5.5 million improvement in net results after excluding non-cash charges. The changes in working capital primarily included a change in the timing and payments related to general business accruals, mainly related to delivery service providers, and an increase in prepaid rent payments due to the shift of our fiscal calendar, partially offset by a change in the timing and payments related to general business operations.

Current wording

For the thirty-nine weeks ended September 30, 2026, net cash provided by operating activities was $136.0 million compared to $159.2 million for the thirty-nine weeks ended September 24, 2025, a decrease of $23.2 million. The decrease was primarily driven by changes in working capital of $42.5 million, partially offset by a $19.3 million improvement in net results after excluding non-cash charges. The changes in working capital primarily included a change in the timing and payments related to general business accruals, mainly related to delivery service providers, an increase in prepaid payments primarily related to software subscription fees, and a change in timing and payments related to general business operations, partially offset by improved collection of receivables as compared to prior period.

Previous wording

For the twenty-six weeks ended July 1, 2026, net cash used in investing activities was $104.9 million compared to $67.4 million for the twenty-six weeks ended June 25, 2025. The change was primarily driven by an increase of $37.5 million of capital expenditures related to our larger development pipeline, compared to the prior year.

Current wording

For the thirty-nine weeks ended September 30, 2026, net cash used in investing activities was $162.4 million compared to $106.7 million for the thirty-nine weeks ended September 24, 2025. The change was primarily driven by an increase of $55.7 million of capital expenditures related to our larger development pipeline, compared to the prior year.

Previous wording

For the twenty-six weeks ended July 1, 2026, net cash used in financing activities was $12.7 million, which was flat compared to the same period last year, primarily driven by a decrease in withholding taxes related to net settled equity awards, partially offset by an increase in distributions paid to non-controlling interest holders.

Current wording

For the thirty-nine weeks ended September 30, 2026, net cash used in financing activities was $14.7 million compared to $15.5 million for the thirty-nine weeks ended September 24, 2025, a decrease of $0.8 million. This decrease was primarily driven by a decrease in withholding taxes related to net settled equity awards, partially offset by an increase in distributions paid to non-controlling interest holders.

Previous wording

Material contractual obligations arising in the normal course of business primarily consist of operating and finance lease obligations, long-term debt, liabilities under the Tax Receivable Agreement and purchase obligations. The timing and nature of these commitments are expected to have an impact on our liquidity and capital requirements in future periods. Refer to Note 6,

Current wording

Material contractual obligations arising in the normal course of business primarily consist of operating and finance lease obligations, long-term debt, liabilities under the Tax Receivable Agreement and purchase obligations. The timing and nature of

Previous wording

Debt and Note 7, Leases, in the accompanying Condensed Consolidated Financial Statements, for additional information relating to our long-term debt and operating and financing leases.

Current wording

40 |Shake Shack Inc. Form 10-Q these commitments are expected to have an impact on our liquidity and capital requirements in future periods. Refer to Note 6, Debt and Note 7, Leases, in the accompanying Condensed Consolidated Financial Statements, for additional information relating to our long-term debt and operating and financing leases.