McDonald's vs Shake Shack: Revenue, Profit and Business Model
McDonald's reported $26.9B of revenue in FY2025 and $8.6B of net income. Shake Shack reported $1.4B of revenue in FY2025 and $45.7M of net income.
Latest financial snapshot
McDonald's
- Latest revenue
- $26.9B (FY2025)
- Net income
- $8.6B
- Net margin
- 31.9%
- Revenue growth
- +1.0% a year, FY2016–FY2025
Shake Shack
- Latest revenue
- $1.4B (FY2025)
- Net income
- $45.7M
- Net margin
- 3.2%
- Revenue growth
- +20.6% a year, FY2016–FY2025
Financial summary
McDonald's
McDonald's corporate revenue ($26.885 billion in 2025, up 3.7%) is a fraction of the roughly $139 billion that customers spend across the system, because franchised restaurant sales are not booked as company revenue. What the company does book is mostly franchise rent and royalties, which explains net income of $8.563 billion in 2025 and operating margins well above typical restaurant operators. In Q2 2026, revenue rose 4% (2% in constant currency) to about $7.1 billion, diluted EPS was $3.32 ($3.38 adjusted), and systemwide sales grew 5% to $37 billion. The company returns most free cash flow through dividends, which it has raised every year since 1976, and share buybacks.
Shake Shack
Shake Shack has turned growth into steadier profit. Revenue climbed from $1.088 billion in FY2023 to $1.445 billion in FY2025, and net income rose from $10.2 million in FY2024 to $45.7 million in FY2025 as restaurant-level margin improved 120 basis points to 22.6% of Shack sales. 2026 has been uneven: Q1 revenue rose 14.3% to $366.7 million with a $0.3 million net loss, while Q2 revenue rose 17.2% to $417.6 million with $16.9 million of net income, slightly below the prior-year $18.5 million.
Revenue and profit by year
McDonald's
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $26.9B | $8.6B | 31.9% | +3.7% | Source |
| FY2024 | $25.9B | $8.2B | 31.7% | +1.7% | Source |
| FY2023 | $25.5B | $8.5B | 33.2% | +10.0% | Source |
| FY2022 | $23.2B | $6.2B | 26.6% | -0.2% | Source |
| FY2021 | $23.2B | $7.5B | 32.5% | +20.9% | Source |
| FY2020 | $19.2B | $4.7B | 24.6% | -10.1% | Source |
| FY2019 | $21.4B | $6B | 28.2% | +0.5% | Source |
| FY2018 | $21.3B | $5.9B | 27.9% | -6.8% | Source |
| FY2017 | $22.8B | $5.2B | 22.8% | -7.3% | Source |
| FY2016 | $24.6B | $4.7B | 19.0% | — | Source |
Shake Shack
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $1.4B | $45.7M | 3.2% | +15.4% | Source |
| FY2024 | $1.3B | $10.2M | 0.8% | +15.2% | Source |
| FY2023 | $1.1B | $20.3M | 1.9% | +20.8% | Source |
| FY2022 | $900.5M | -$21.2M | -2.4% | +21.7% | Source |
| FY2021 | $739.9M | -$4.6M | -0.6% | +41.5% | Source |
| FY2020 | $522.9M | -$42.2M | -8.1% | -12.1% | Source |
| FY2019 | $594.5M | $19.8M | 3.3% | +29.4% | Source |
| FY2018 | $459.3M | $15.2M | 3.3% | +28.0% | Source |
| FY2017 | $358.8M | -$320,000 | -0.1% | +33.6% | Source |
| FY2016 | $268.5M | $12.4M | 4.6% | — | Source |
Where the revenue comes from
McDonald's
- Franchise rent and royalties~45%
Franchise rent and royalties
- Company-operated restaurants~25%
Company-operated restaurants
- Licensing and delivery economics~15%
Licensing and delivery economics
Shake Shack
- Company-operated Shacks
Restaurant sales from company-run domestic locations.
- Licensed Shacks
License fees and royalties from domestic and international licensed restaurants.
- Digital and Off-Premise
App, web, kiosk, delivery, and pickup channels that support restaurant sales.
Business model and strategy
McDonald's
How it makes money
About 95% of McDonald's restaurants are owned and operated by franchisees or developmental licensees. The corporation makes money in three main ways: (1) rent, because it owns or leases the land and buildings at many franchised sites and charges franchisees rent, often tied to a percentage of sales; (2) royalties, a percentage of each restaurant's monthly sales;
Growth strategy
McDonald's growth plan, branded Accelerating the Arches, rests on marketing, core menu (burgers, chicken, coffee), and the 3 D's: digital, delivery, and drive-thru. The company targets roughly 50,000 restaurants worldwide by the end of 2027, with China, other developmental licensed markets, and the U.S. contributing the largest number of openings.
Competitive advantage
McDonald's advantage is scale that rivals cannot easily copy: more than 45,000 restaurants, control of prime real estate at many franchised sites, a long-tenured franchisee base that funds most store capital, and a supply chain that buys beef, potatoes, chicken, and packaging at volumes few chains match.
Shake Shack
How it makes money
Shake Shack runs a two-part model. Company-operated Shacks, mostly in the U.S., produce the bulk of revenue: in Q2 2026 Shack sales were $403.4 million of $417.6 million total revenue. Licensed Shacks, run by partners in airports, stadiums, highway plazas and international markets such as the Middle East, Asia, the U.K. and Mexico, pay license fees and royalties; licensing revenue was $14.2 million in Q2 2026.
Growth strategy
Under CEO Rob Lynch, Shake Shack is pursuing faster unit growth, lower build costs, higher restaurant-level margins and more marketing and menu innovation. Company-operated growth leans on suburban and drive-thru formats, while licensed growth continues in airports, travel plazas and international markets. Digital ordering through the Shack App, web and kiosks supports throughput.
Competitive advantage
Shake Shack's edge comes from brand heat and its hospitality roots. The concept was built by Danny Meyer's Union Square Hospitality Group, and the company still leans on that service culture, a premium menu of Angus beef burgers, crinkle-cut fries and frozen custard, and distinctive restaurant design. The brand travels well enough that licensees have opened more than 250 international Shacks.
Questions about McDonald's vs Shake Shack
Which company has higher revenue — McDonald's Corporation or Shake Shack Inc.?
McDonald's Corporation reported $26.9B (FY2025), while Shake Shack Inc. reported $1.4B (FY2025). By last reported revenue, McDonald's Corporation is the larger business, with Shake Shack Inc. reporting a smaller revenue base.
What is the market cap of McDonald's Corporation vs Shake Shack Inc.?
McDonald's Corporation's market capitalisation stands at $175.7B, while Shake Shack Inc.'s is $2.4B. McDonald's Corporation carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to Shake Shack Inc..
Which is more financially efficient — McDonald's Corporation or Shake Shack Inc.?
McDonald's Corporation generates $179k / employee in revenue per employee, while Shake Shack Inc. generates $104k / employee. McDonald's Corporation shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do McDonald's Corporation and Shake Shack Inc. make money?
McDonald's Corporation and Shake Shack Inc. generate revenue in fundamentally different ways. McDonald's Corporation: About 95% of McDonald's restaurants are owned and operated by franchisees or developmental licensees. Shake Shack Inc.: Shake Shack runs a two-part model.
Which company is valued higher relative to revenue — McDonald's Corporation or Shake Shack Inc.?
On a price-to-sales (P/S) basis, McDonald's Corporation trades at 6.5x P/S and Shake Shack Inc. at 1.7x P/S. McDonald's Corporation commands a higher revenue multiple, typically indicating that investors expect faster growth or higher future margins compared to Shake Shack Inc.. A higher multiple is not inherently better — it may also signal that the stock is priced for perfection.
Is McDonald's Corporation bigger than Shake Shack Inc.?
By last reported revenue, McDonald's Corporation ($26.9B (FY2025)) is the larger company compared to Shake Shack Inc. ($1.4B (FY2025)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the McDonald's vs Shake Shack overview