One of the world’s most recognised plant-based meat brands, Beyond Meat has released its latest quarterly results, showing a 30 percent decline in net revenue year-on-year.
Earlier this week, the US brand – founded in 2009 – released its financial results for the second quarter, ended 1 July, 2023.
Key elements of the results are:
- Net revenues were $102.1 million, a 30.5 percent year-on-year decrease.
- 23.9 percent decrease in volume of products sold, and a 8.6 percent decrease in net revenue per pound.
- Gross profit of $2.3 million, compared to a loss of $6.2 million in the year-ago period.
- Net loss was $53.5 million, compared to a net loss of $97.1 million in the year-ago period.
- Adjusted EBITDA was a loss of $40.8 million compared to a loss of $68.8 million the year prior.
Despite the significant sales slump, Beyond Meat president and CEO, Ethan Brown, said he remains confident the brand will turn things around, albeit modestly, in the next two quarters.
“The second quarter brought mixed results amidst otherwise strong progress towards our goal of sustainable long term growth. Ongoing category headwinds compressed net revenues, which in turn impacted product sales mix and gross margin, overshadowing significant strides in operational efficiency, including meaningful year-on-year reductions in operating expenses, COGS per pound, and overall cash consumption,” he said.
“While we are reducing our full-year 2023 net revenues outlook, we nevertheless expect a modest return to year-over-year top-line growth in the third and fourth quarters of 2023, and, relative to the first half of 2023, a meaningful reduction in cash consumption and an increase in gross margin. As we look to the future, we remain steadfast in our belief that plant-based meat, and Beyond Meat specifically, will play an important part of the global response to a climate crisis that appears to be rapidly intensifying, while also delivering health benefits to the individual consumer.”
According to a company statement, the 30.5 percent reduction in net revenues was driven by a 23.9 percent decrease in volume of products sold, and a 8.6 percent decrease in net revenue per pound.
“The decrease in volume primarily reflected weak category demand, especially in the company’s US retail and US foodservice channels, and the cycling of a particularly strong second quarter in 2022,” the statement reads.
US retail channel net revenues decreased 38.5 percent compared to the year-ago period, reflecting weak category demand and the cycling of significant sell-in of Beyond Meat Jerky the year prior. US foodservice channel net revenues decreased 45.4 percent compared to the year-ago period, due to a 44.2 percent decrease in volume of products sold, reflecting weak overall demand and comparison against a particularly strong second quarter in 2022.
International retail channel net revenues decreased 15.6 percent, while international foodservice channel net revenues decreased 0.9 percent.
“The company’s operating environment continues to be affected by uncertainty related to macroeconomic issues, including softer demand in the plant-based meat category, high inflation, rising interest rates and ongoing concerns about the likelihood of a recession, among other things,” the statement reads.
Beyond Meat is predicting the rest of the year will deliver:
- Net revenues in the range of $360-$380 million, representing a decrease of approximately 14 to nine percent compared to 2022.
- Gross margin in the mid to high single digit range.
- Greater than expected category and consumer headwinds mean the company now believes it’s unlikely to achieve its target of being cashflow positive within the second half of 2023.