Beyond Meat, once a leader in the plant-based meat industry, reported a higher third-quarter loss than expected and declining sales due to reduced demand from U.S. consumers and restaurants.
The company reported a third-quarter loss of $110.7 million on Monday, up from $26.6 million in the same period last year.
Revenue dropped 13 percent to $70.2 million, driven by a 10 percent decline in product volume and a 3.5 percent decrease in revenue per pound, the company said.
Beyond Meat said demand fell due to weaker category interest, fewer U.S. distribution points, and lower international burger sales, while higher discounts and price cuts also hurt pricing, according to the Wall Street Journal.
U.S. revenue fell 21 percent, while international sales declined just 1 percent, figures which showcase the steep losses being felt in the domestic market.
Beyond reported a $77.4 million non-cash impairment charge tied to certain long-term assets, which caused the company to delay its earnings release while determining the size of the charge.
Once valued at around $14 billion, Beyond’s decline began after the COVID-19 pandemic, as rising inflation made its higher-priced products less appealing.
Shifts in consumer preferences toward simpler, healthier foods, boosted by trends like the “Make America Healthy Again” movement and the popularity of weight-loss drugs, accelerated the drop.
"There have been lots of questions raised about how plant-based meat is produced in an age when many people are choosing to seek out simple alternatives like beans and pulses," Danni Hewson, a financial analyst at AJ Bell, told Reuters in August.
Beyond announced that its sales and customer base continued to decline in the second quarter on this year. Net revenues fell 19 percent to $75 million, while the company posted a net loss of $29.2 million and an operating loss of $34.9 million.
In response to the second quarter challenges, the company said it was taking cost-cutting measures, including laying off 44 employees in North America, a move expected to save $5 million to $6 million in compensation expenses over the next year.
Beyond’s stock saw a brief surge in October before settling back down, closing at $3.58 per share, down 1 percent despite earlier gains that more than doubled its value. The rally followed news that the company is expanding the availability of select products, including chicken pieces, Korean BBQ-style steak, and burger six-packs, at over 2,000 Walmart stores.
Looking ahead, Beyond expects fourth-quarter revenue between $60 million and $65 million.
The company previously withdrew its full-year forecast in May due to market uncertainty and has not reinstated it.
