Shake Shack’s CEO, Rob Lynch, says food chains will likely introduce more chicken and beef menu items as the price of eggs soars.
On the company’s fourth-quarter earnings call on Thursday, Lynch discussed the impact of tariffs and imports on the burger chain’s business.
Lynch said the company sources the majority of its ingredients domestically and won’t have major exposure to tariffs.
Thanks to its menu, it is largely insulated from the skyrocketing price of eggs as well.
“I mean we don’t have a breakfast business, a big breakfast business. So we don’t have the exposure to eggs,” Lynch said.
“But other restaurant companies that have exposure to eggs may be moving away from eggs in the time being, which means they are going to offer more beef products or chicken products to complement, to substitute for that high-cost item,” he said.
Shake Shack is known for its beef, chicken, and mushroom burgers, as well as its fries and frozen custard shakes. While eggs don’t play heavily into its menu, fast food giants from Chick-fil-A and Taco Bell to McDonald’s and Burger King rely on eggs for some of their popular breakfast menu items.
Lynch’s comments come as egg prices in the US soar. Prices increased by 15.2% from December to January, the largest monthly spike in 10 years. In January, the average price of a dozen large Grade A eggs in the country hit an all-time high of $4.95.
The surge was caused due to supply chain issues stemming from a H5N1 bird flu outbreak in the US. The flu has forced farmers to cull infected birds, leading to egg shortages.
Chains like Costco have seen egg cartons fly off their shelves minutes after store openings. Grocery stores like Whole Foods, Trader Joe’s, and Costco have imposed limits on the number of cartons each customer can purchase. Earlier this month, Waffle House started adding a 50-cent surcharge to each egg it sells.
Shake Shack, which started as a hot dog kiosk in New York City’s Madison Square Park in 2004, has over 570 locations worldwide, including more than 370 outlets in the US.
The chain posted a total quarterly revenue of $329 million, up 14.8% from the same quarter in 2023. This included $317 million of company-operated sales and about $12 million from licensing revenue.
The company’s stock was up 11% at market close on Thursday. It’s up more than 27% in the past year.
Representatives for Shake Shack did not respond to a request for comment from Business Insider.
The post Shake Shack’s CEO said the cost of eggs will likely drive up demand for beef and chicken appeared first on Business Insider.
