Financial Data and Key Metrics Changes - In Q4 2021, Shake Shack reported a revenue of $203.3 million, a year-over-year increase of over 38% [22] - System-wide sales for the full year exceeded $1.1 billion, growing over 47% year-over-year and more than 25% compared to 2019 levels [23] - Shack-level operating profit margin was 16.4%, up 40 basis points year-over-year [22][34] Business Line Data and Key Metrics Changes - Same-Shack sales rose 20.8% year-over-year, closing the gap to 2019 Same-Shack sales [22] - Average weekly sales reached $74,000, an increase from $72,000 reported in the previous quarter [23] - The licensed business generated $118.4 million in sales, up 50% year-over-year, driven by new openings and increased holiday air travel [28] Market Data and Key Metrics Changes - Urban Same-Shack sales were 4% below 2019 levels, a significant improvement from down 15% in the prior quarter [24] - Suburban Same-Shack sales were 9% above 2019 levels, showing strong performance across all regions [25] - The company opened 6 new licensed Shacks in Q4, including its second in Shenzhen, China [19] Company Strategy and Development Direction - The company plans to open 45 to 50 company-operated Shacks in 2022, with a focus on new formats like drive-thru [16] - Shake Shack is committed to digital transformation, enhancing guest experience through digital tools and personalized marketing [15][30] - The company aims to maintain its value proposition while navigating inflationary pressures by implementing price increases of 6% to 7% [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about recovery as urban centers and travel patterns normalize post-COVID [12] - The impact of Omicron on staffing and sales was acknowledged, with expectations of continued volatility in the near term [11][27] - February showed a steady uptick in Same-Shack sales, up approximately 13% year-over-year, indicating potential recovery [11][27] Other Important Information - The company ended Q4 with $382.4 million in cash and marketable securities, positioning it well for growth [36] - Labor costs were reported at $57.9 million, or 29.6% of total Shack sales, down from 31.1% in the prior quarter [33] - The company is focused on elevating its workforce, with a 13% increase in hourly starting wages [13] Q&A Session Summary Question: How should the comment on protecting margins be interpreted? - Management clarified that the planned price increase of 6% to 7% is necessary due to persistent inflation and cost pressures, with a focus on long-term sales recovery [40] Question: What is the pricing elasticity and how does it affect pricing power? - Management believes they have strong pricing power, supported by a tiered pricing approach and positive reception to previous price increases [45][46] Question: What are the expectations for average weekly sales post-Omicron? - Management expressed confidence in returning to pre-COVID sales levels, emphasizing the importance of urban recovery and consumer behavior [56] Question: What is the long-term outlook for restaurant margins? - Management maintained that long-term guidance for margins remains unchanged, with a focus on rebuilding profitability [66] Question: What marketing initiatives are planned for 2022? - Management indicated plans for fun collaborations and increased digital marketing efforts to create buzz around the brand [68]

Financial Data and Key Metrics Changes - Total revenue for Q3 2021 reached $193.9 million, marking a 49% year-over-year increase and the highest revenue in the company's history [23][7] - Average weekly sales for Q3 were $72,000, exceeding historical seasonality expectations, while October's average weekly sales were $70,000, above September levels [24][26] - Same-Shack sales rose 24.8% year-over-year in Q3, with October Same-Shack sales just 1% below 2019 levels, showing significant recovery [25][26] Business Line Data and Key Metrics Changes - The company experienced approximately 100 days of temporary closures due to COVID and extreme weather, resulting in an estimated $850,000 in lost sales [24] - Same-Shack sales were about 7% below 2019 levels in Q3, improving from a 12% decline in Q2 [25] - Suburban Same-Shack sales were reported to be 7% above 2019 levels in October, indicating strong performance in suburban locations [27][30] Market Data and Key Metrics Changes - Urban Same-Shack sales were down 11% from 2019 levels in September, improving to down 8% in October, reflecting a steady urban recovery [26] - The company noted that all regions outside of New York City had more than fully recovered to 2019 sales levels as of October [27] - The licensed business generated $6.9 million in revenue for the quarter, benefiting from the relaxation of COVID-related restrictions [34] Company Strategy and Development Direction - The company is focused on elevating its workforce, investing in higher wages and retention bonuses to attract and retain talent [10][13] - A digital transformation is underway, with investments in omni-channel guest experiences and new menu items launched exclusively through the app [14][15] - Plans for 2022 include opening 45 to 50 new Shacks, with a focus on suburban locations and drive-thru formats [17][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing profitability challenges due to rising costs of goods and labor, with beef prices up approximately 30% year-over-year [11][39] - The company remains cautious about potential supply chain disruptions and labor market volatility as it approaches the colder months [35][36] - Despite challenges, management expressed confidence in the company's growth trajectory and the ability to navigate through uncertainties [48][49] Other Important Information - The company reported a Shack level operating margin of 15.8% for Q3, within the guided range, but noted margin dilution due to labor and commodity inflation [37][39] - G&A expenses for Q3 were $20.5 million, reflecting continued investments in marketing and technology [43] - The balance sheet remains strong, ending the quarter with $401.5 million in cash and marketable securities [47] Q&A Session Summary Question: Impact of operational delays on average weekly sales - Management noted that while there were temporary closures and some staffing challenges, the impact on average weekly sales was not broad-based [51][52][53] Question: Future pricing strategy amid inflation - Management indicated a history of conservative pricing but acknowledged the potential for further price adjustments if inflationary pressures continue [54][55][56] Question: Suburban sales trends and drivers - Management highlighted a strong rebound in traffic across suburban formats, with successful limited-time offers contributing to sales growth [59][60][61] Question: Beef price outlook for Q4 - Management reported that while beef prices spiked in Q3, they have seen some stabilization but remain in an inflationary environment [63][64] Question: Menu innovation amidst supply chain challenges - Management acknowledged disruptions but emphasized that these challenges have not materially distracted from their menu innovation efforts [75]

Financial Performance - Shack-level operating profit was $34.8 million, representing 19.2% of Shack sales in Q2 2021[7] - Adjusted EBITDA was $20.6 million, which is 11.0% of total revenue in Q2 2021[7] - Cash flow from operations increased to $56 million in Q2 2021 (TTM)[9] Sales and Operations - Average weekly sales (AWS) improved to $72,000 in Q2 2021, driven by the return of in-Shack sales, with digital sales retention remaining high at approximately 80%[8] - Fiscal July 2021 AWS reached $74,000, up from $64,000 in Q1 2021[12] - Same-Shack sales (SSS) increased by 38% in fiscal July 2021 compared to 2020[12] - Urban SSS versus 2019 improved to (18%) in fiscal July 2021, up from (27%) in fiscal April 2021[12] - The company retained approximately 80% of digital sales as in-Shack sales recovered[39] Expansion and Development - The company is investing an additional $10 million in the Shack team over the next 12 months[8, 13] - The company opened 19 company-operated Shacks YTD as of fiscal July 2021 and is targeting 35-38 total openings in 2021, including the first Shack drive-thru[8] - Class of 2021 openings achieved an AWS of $81,000, approximately 20% higher than the rest of the company-operated Shacks[8, 12, 43] - The company is targeting 10 drive-thru openings through 2022[47] Guidance - The company expects total revenue of $194 million to $200 million for 2021[55] - The company expects Shack sales of $188 million to $193 million for 2021[55] - The company expects licensed revenue of $6 million to $7 million for 2021[55]

Financial Data and Key Metrics Changes - Total revenue in Q2 2021 was $187.5 million, up 104% year-over-year, marking the highest revenue quarter ever for the company [9][20] - Shack sales were $181.5 million, reflecting a year-over-year growth of 102.7% [20] - Shack level margin improved to 19.2% in Q2, a 420 basis-point increase from the first quarter [10][30] Business Line Data and Key Metrics Changes - Same Shack sales increased by 52.7% year-over-year in Q2, with traffic growing 61.5% year-over-year [22][27] - Digital sales accounted for 47% of Shack sales in Q2, with a retention rate of approximately 80% [27][28] - The company opened 20 domestic company-operated Shacks in 2021 and plans to open 15 to 18 more by year-end [11][12] Market Data and Key Metrics Changes - Urban markets showed signs of recovery, with same Shack sales down only 9% compared to July 2019 levels [9][24] - The Southeast region, particularly Texas, reported same Shack sales above 2019 levels, indicating strong market performance [26] - Licensed business saw a strong uptick in sales, with weekly sales performance increasing from $6.6 million in April to $8.7 million in July [13][14] Company Strategy and Development Direction - The company is focusing on the evolution of Shack formats through physical and digital transformation to enhance guest experience [10] - Plans to open drive-thru locations and Shack Track walk-up windows are part of the strategic investment in new formats [11][12] - The company is committed to investing $10 million in team members for wage increases and leadership development [7][19] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about the ongoing COVID situation but is encouraged by the current momentum in sales recovery [9][39] - The company expects to see continued growth in both urban and suburban markets, with a focus on digital sales and new Shack openings [29][30] - Management believes that investments in team members and innovation will position the company for stronger recovery and growth [39][40] Other Important Information - The company plans to raise menu prices by 3% to 3.5% in Q4 to counter inflationary pressures [33] - G&A expenses for 2021 are slightly raised to between $86 million and $88 million to support growth initiatives [36] - The balance sheet remains strong, ending the quarter with $420.2 million in cash and marketable securities [38] Q&A Session Summary Question: Importance of maintaining positive sales gap for new Shacks - Management acknowledges the importance of maintaining the positive sales gap and highlights the mix of suburban and urban locations contributing to strong performance [42][43] Question: Details on the $10 million investment in team members - Management confirms that a significant portion of the investment will be loaded in the back half of the year, focusing on wage increases and retention bonuses [45][46] Question: Managing elevated construction costs - Management emphasizes the long-term vision for building Shacks and the importance of investing in new formats despite current cost pressures [48][50] Question: Recovery rates of new unit classes - Management indicates that it is too early to provide reliable comparisons for recovery rates of new unit classes due to COVID impacts [65][66]

Financial Data and Key Metrics Changes - Total revenue for Q1 2021 was $155.3 million, an increase of 8.5% year-on-year, with Shack sales at $150.7 million, growing 9.1% year-on-year [8][23] - Average weekly sales improved to $64,000 compared to $62,000 in Q4 2020, with March average weekly sales at $68,000 and $69,000 in fiscal April [8][24] - Shack-level margin was 15% for Q1, improving to just under 19% by the end of March [9][31] Business Line Data and Key Metrics Changes - Same-Shack sales increased by 5.7% in Q1 and surged by 86% in fiscal April compared to 2020 [9][25] - Average weekly sales for the 2021 class of Shacks opened was over $79,000, significantly higher than the system average [12] - The company opened 10 domestic company-operated Shacks in Q1 and plans to open between 35 and 40 new Shacks in 2021 [10][11] Market Data and Key Metrics Changes - Suburban Shacks showed a nearly flat performance compared to 2019, while urban Shacks were down 25% in March and 27% in April compared to 2019 [27][28] - Internationally, the company opened two new Shacks in the Middle East and six additional openings in Asia during Q1 [13][15] - The UK Shacks began reopening as lockdown restrictions eased, and Shacks in China experienced strong sales [15] Company Strategy and Development Direction - The company is focused on opening and operating new Shacks while enhancing digital transformation and guest experience [10] - Plans to test drive-throughs with potential for up to eight locations by 2022, indicating a shift towards more convenient service options [12] - The company aims to expand its license operations significantly, targeting 15 to 20 new license Shacks in 2021 and 20 to 25 in 2022 [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about recovery trends as COVID restrictions ease, with a focus on rebuilding in-Shack sales [7][28] - The company anticipates total revenue for Q2 to be between $174 million and $183 million, with same-Shack sales expected to increase in the mid-40s to 50% range [29] - Management acknowledged challenges in urban markets, particularly in high-volume areas, but remains confident in the overall recovery trajectory [28][70] Other Important Information - The company launched a new limited-time menu and is focusing on enhancing its beverage offerings, which have seen increased sales [19][20] - The company published its annual Stand For Something Good report, outlining ESG priorities and diversity goals [21] - Tara Comonte, the President and CFO, announced her departure, with a search for her replacement underway [38][39] Q&A Session Summary Question: Store openings and comp base normalization - Management noted that new Shacks opened at an average of $79,000 weekly, indicating strong performance despite pandemic challenges [43][44] Question: Labor environment and hiring challenges - Management acknowledged staffing challenges but reported no material impact on operations, emphasizing their commitment to investing in team members [49][50] Question: Urban Shack performance and sales deceleration - Management explained that slight deceleration in urban sales is due to a small comp base and specific Shack closures impacting overall performance [51][52] Question: Q2 comp guidance and average weekly sales - Management refrained from breaking down guidance further, citing high uncertainty in the current operating environment [58] Question: Confidence in growth and site openings - Management expressed confidence in site availability and brand strength, while also noting potential cost inflation in construction materials [76][77]