The meat alternative maker, which went public in 2019, has had trouble maintaining its status as the leader in the alternative protein category. In the first half of the fiscal year 2022, Beyond’s net losses quadrupled year-over-year, to $197.6 million. In turn, investors have been cool on the company, with Beyond Meat’s stock down nearly 80% this year, from $65 to $13.
Beyond Meat reported its fiscal third-quarter earnings on Wednesday, revealing revenue of $82.5 million, a 22.5% drop year-over-year. Meanwhile, quarterly net losses came to $101.7 million, or $1.60 per share. Like previous quarters, Beyond Meat attributed the negative results to a drop in both retail and foodservice channels for its products. The decrease in revenue, for instance, was “driven by a 12.8% decrease in total pounds sold and an approximately 11.2% decrease in net revenue per pound.”
Still, Beyond Meat is hopeful it will achieve profitability in the coming year.
In October, the company announced a goal of becoming cash flow positive by the end of 2023 — and with that will come aggressive tactics to trim operating costs. This will include mass layoffs, potentially letting go 19% of its workforce, according to the company. In the latest earnings’ release statement, Beyond Meat founder and CEO Ethan Brown reiterated these plans.
“Beyond Meat is executing a full force pivot to a sustainable growth model, emphasizing the achievement of cash flow positive operations within the second half of 2023,” Brown said. “This transition is designed to fortify our business in the near-term as record inflation continues to pose a challenge for our brand and category, positioning Beyond Meat to endure and advance toward our long-term objective of being a major protein provider within the $1.4 trillion meat industry.”
Much of Beyond’s ongoing woes are due to retailers’ drop in plant-based product orders, which comes as a result of shoppers opting for cheaper protein brands. The company has also said that it’s increasingly facing increased costs of raw material, manufacturing and logistics. Not to mention, more food startups, along with meat giants like Tyson Foods, continue to enter the market.
“I’m not all that surprised by the results,” said Jonah Ellin, chief product officer at 1010data. Ellin noted that while the meatless protein category itself will continue to gain traction over time, it’s no longer experiencing the meteoric rise it did in past years — especially as consumer interest has leveled off amid this year’s inflationary period.
After growing as a publicly-traded company between 2019 and 2020, Beyond Meat’s valuation began to drop along with its revenue growth rate. In 2019, the company’s valuation hit an all-time high of $3.8 billion — it has since deflated to less than a billion. During its peak, Beyond’s market cap was estimated to be $13.85 billion. Today, that figure has dropped down to about $752.55 million.
“When they came out, Beyond Meat was the product,” Ellin explained. Not to mention, there are now countless meatless protein alternatives that customers are seeking out. “They’re no longer exclusively looking for the Beyond name.” With Beyond’s packaged burgers costing around the same as standard meat these days, Ellin said it can be a hard sell for many households cutting back on meat to save money.
Some of Beyond Meat’s newest initiatives, meant to diversify its retail offerings, are already impacting its bottom line. Beyond’s plant-based jerky collaboration with PepsiCo, part of its The Planet Partnership, resulted in a loss of $7.7 million in gross profit. This past quarter, the jerky’s venture resulted in approximately $5.9 million of added costs, according to the earnings report.
On the other hand, Beyond Meat has an opportunity to return to its premium roots, Ellin said. For instance, the company just announced a plant-based steak, which Ellin said could help it attract higher end grocery shoppers.
“Hopefully, they’ll drive enough volume to offset losses from these investments,” Ellin said. “The challenge is to get people to consistently buy their products over and over.”
FAQs
Much of Beyond's ongoing woes are due to retailers' drop in plant-based product orders, which comes as a result of shoppers opting for cheaper protein brands. The company has also said that it's increasingly facing increased costs of raw material, manufacturing and logistics.
Is Beyond Meat company in trouble? ›
There are definitely good things going on at this food maker. But the bad news is still material, and that should worry investors. For example, despite the strength of the company's products in foreign markets, overall sales for Beyond Meat fell 7.8% in the final part of 2023. For the full year, sales were down by 18%.
Why is Beyond Meat making losses? ›
Beyond Meat, Inc. suffered a loss of $338.1 million during fiscal 2023 on sales of $343.4 million. Much of the loss stems from impairment charges taken in the fourth quarter as management tries to right size the business for the future.
Is now a good time to invest in Beyond Meat? ›
BYND Signals & Forecast
There are few to no technical positive signals at the moment. The Beyond Meat Inc. stock holds sell signals from both short and long-term Moving Averages giving a more negative forecast for the stock.
What happened to Beyond Beef Jerky? ›
Beyond Meat Jerky, the first product to emerge from the firm's 'Planet Partnership' joint venture with PepsiCo, is being discontinued less than two years after launch, Brown told analysts after posting a $155 million net loss on sales down 7.8% to $73.7 million in the fourth quarter of 2023.
Has Beyond Meat gone bust? ›
The hype around Beyond Meat didn't last with investors, and it hasn't lasted with consumers, either. The food maker's trailing-12-month revenue peaked in 2022 and has been falling for about a year. That's clearly bad news, but it gets worse. Beyond Meat has never turned a full-year profit.
Is Beyond Meat processed in China? ›
Both plant-based pork products, along with Beyond Beef™, and the Beyond Burger® are produced locally at Beyond Meat's manufacturing facility in Jiaxing, China.
Will Beyond Meat recover? ›
Indeed, sales volumes are down, and that's a metric that shareholders will want to see a recovery in for 2024. But that rebound could easily start soon given that volume declines slowed to 1.5% last quarter from 3% in the prior three-month period.
Will Beyond Meat get cheaper? ›
Beyond Meat in 2024 will make “a steep reduction in our operating costs,” increase prices for some products and “right-size” its production footprint, CEO Ethan Brown told investors in an earnings call Tuesday.
Who is the competition of Beyond Meat? ›
Beyond Meat's competitors and similar companies include Sovos Brands, Next Level Burger, Hungry Planet, Perfect Day and Impossible Foods. Beyond Meat is a company that produces plant-based meat substitutes.
Looking ahead to 2024, Beyond Meat plans to have additional certifications and partnerships with third-party endorsem*nts touting the health benefits of its products to help bridge these gaps, Brown said to investors.
What is the outlook for Beyond Meat? ›
Beyond Meat Stock Forecast
The 5 analysts with 12-month price forecasts for Beyond Meat stock have an average target of 7.00, with a low estimate of 3.00 and a high estimate of 10. The average target predicts an increase of 6.71% from the current stock price of 6.56.
Why is Beyond Meat not profitable? ›
Sell Beyond Meat
Beyond Meat's stock has plunged because the company's product-market fit is failing. Consumers are turning away from its product, and it can't make it at a price point where it can turn a profit.
Is Beyond Meat losing popularity? ›
The plant-based meat company is making some significant changes as a result of its declining sales. Plant-based meat producer, Beyond Meat, is hitting the reset button on its failing business, and it involves implementing some changes consumers may not like.
Why is Beyond beef so expensive? ›
Plant-based beef alternatives are more expensive than beef because of production costs. Even though the plant-based beef industry uses less grain to create its products than what gets used for livestock feed, the scale is much smaller. This leads to higher costs, which get passed to consumers.
How is Beyond Meat doing financially? ›
Net revenues were $75.3 million, a decrease of 8.7% year-over-year. Gross profit was a loss of $7.3 million, or gross margin of -9.6%, compared to a loss of $14.8 million, or gross margin of -18.0%, in the year-ago period.
What is going on with Beyond Meat? ›
Sales are declining, and the company is losing a lot of money. This combination has turned most investors sour on the stock, with an estimated 44% short interest as of this writing. Beyond Meat stock has gone through three straight poor years.
What is the outlook for Beyond Meat company? ›
BYND Stock 12 Month Forecast
Based on 9 Wall Street analysts offering 12 month price targets for Beyond Meat in the last 3 months. The average price target is $6.86 with a high forecast of $10.00 and a low forecast of $3.00. The average price target represents a -8.17% change from the last price of $7.47.
