Shake Shack (Shake Shack) Operating Income : $28 Mil (TTM As of Dec. 2023)

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What is Shake Shack Operating Income?

Shake Shack's Operating Income for the three months ended in Dec. 2023 was $5 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 was $28 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Shake Shack's Operating Income for the three months ended in Dec. 2023 was $5 Mil. Shake Shack's Revenue for the three months ended in Dec. 2023 was $286 Mil. Therefore, Shake Shack's Operating Margin % for the quarter that ended in Dec. 2023 was 1.66%.

Shake Shack's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Shake Shack's annualized ROC % for the quarter that ended in Dec. 2023 was 6.97%. Shake Shack's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 was 0.85%.

Shake Shack Operating Income Historical Data

The historical data trend for Shake Shack's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Shake Shack Operating Income Chart

Shake Shack Annual Data

Trend

Dec14

Dec15

Dec16

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Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Operating Income

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41.87

-25.15

-0.93

-9.42

28.16

Shake Shack Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Operating Income	Get a 7-Day Free Trial															0.89	1.09	11.21	11.12	4.74

Shake Shack Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 adds up the quarterly data reported by the company within the most recent 12 months, which was $28 Mil.

Shake Shack (NYSE:SHAK) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Shake Shack's annualized ROC % for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	18.968 * ( 1 - -383.53% )	/	( (1301.231	+	1331.456)	/ 2 )
=	91.7159704	/	1316.3435
=	6.97 %

where

	Invested Capital		(Q: Sep. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	1564.856	-	92.566	-	( 284.977	-	max(0, 152.177	-	323.236	+	284.977	))
=	1301.231

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	1605.857	-	104.036	-	( 293.214	-	max(0, 164.067	-	334.432	+	293.214	))
=	1331.456

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

2. Joel Greenblatt's definition of Return on Capital:

Shake Shack's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2023 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Sep. 2023		Q: Dec. 2023
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	7.904	/	( ( (923.427 + max(-63.073, 0))	+	(929.291 + max(-85.384, 0)) )	/	2 )
=	7.904	/	( ( 923.427	+	929.291 )	/	2 )
=	7.904	/	926.359
=	0.85 %

where Working Capital is:

	Working Capital		(Q: Sep. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(13.889	+	4.608	+	19.762)	-	(92.566	+	1.972	+	6.794)
=	-63.073

	Working Capital		(Q: Dec. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(14.009	+	5.404	+	6.831)	-	(104.036	+	2.603	+	4.989)
=	-85.384

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Dec. 2023) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Shake Shack's Operating Margin % for the quarter that ended in Dec. 2023 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	4.742	/	286.243
	=	1.66 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Shake Shack Operating Income Related Terms

Thank you for viewing the detailed overview of Shake Shack's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Shake Shack (Shake Shack) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Restaurants » Shake Shack Inc (NYSE:SHAK) » Definitions » Operating Income

Comparable Companies

Traded in Other Exchanges

SHAK:Mexico 9SH:Germany 9SH:Germany

Address

225 Varick Street, Suite 301, New York, NY, USA, 10014

Website

https://www.shakeshack.com

Shake Shack Inc is a roadside burger stands. It is serving a classic American menu of premium burgers, hot dogs, crispy chicken, frozen custard, crinkle-cut fries, shakes, beer, wine and more. The company's burgers are made with a whole-muscle blend of all-natural, hormone and antibiotic-free Angus beef, ground fresh daily, cooked to order and served on a non-genetically modified organism (GMO) potato bun. Its menu focuses on food and beverages, crafted from a range of classic American foods. The company serves draft Root Beer, seasonal freshly-squeezed lemonade, organic fresh brewed iced tea, cold brew coffee, organic apple juice, and Shack20 bottled water.

Executives

Jeffrey Flug	director	C/O PENNANTPARK INVESTMENT CORPORATION, 445 PARK AVENUE, 10TH FLOOR, NEW YORK NY 10022
Chapman Charles J Iii	director	1502 HUNTER DRIVE, WAYZATA MN 55391
Zach Koff	officer: Chief Operating Officer	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Jeffrey D Lawrence	director	30 FRANK LLOYD WRIGHT DR, ANN ARBOR MI 48105
Lori George Billingsley	director	777 HIDDEN RIDGE, IRVING TX 75038
Daniel Harris Meyer	director	24 UNION SQUARE EAST, SIXTH FLOOR, NEW YORK NY 10003
Jenna Lyons	director	C/O J.CREW GROUP, INC., 770 BROADWAY, NEW YORK NY 10003
Katherine Irene Fogertey	officer: Chief Financial Officer	225 VARICK STREET, SUITE 301, NEW YORK NY 10014
Randall J Garutti	director, officer: Chief Executive Officer	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Tara Comonte	officer: CHIEF FINANCIAL OFFICER	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST,5TH FLOOR, NEW YORK NY 10003
Tristan Walker	director	330 WEST 34TH STREET, NEW YORK NY 10001
Robert T Vivian	director	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Sumaiya Balbale	director	697 CALMAR AVENUE, OAKLAND CA 94610
Select Equity Group, L.p.	director, other: See Remarks	380 LAFAYETTE STREET, 6TH FLOOR, NEW YORK NY 10003
Green Equity Investors Vi, L.p.	director, 10 percent owner	11111 SANTA MONICA BOULEVARD, SUITE 2000, LOS ANGELES CA 90025