Beyond Meat cuts annual revenue forecast as faux meat demand dips
Reuters
Published Aug 07, 2023 04:12PM ET
Updated Aug 07, 2023 06:01PM ET
By Ananya Mariam Rajesh
(Reuters) -Beyond Meat cut annual revenue forecast and missed second-quarter net sales estimates, as slowing demand for its pricier plant-based meat products shows no signs of recovery, sending shares down 8% in extended trading on Monday.
Bogged down by inflationary pressures, customers are opting for lower-priced animal protein over alternatives such as plant-based products.
The ambiguity around the health benefits of plant-based meat is also weighing on growth, said CEO Ethan Brown in a post-earnings call.
"This change in perception is not without encouragement from interest groups who have succeeded in seeding doubt and fear around the ingredients and process used to create our and other plant-based meats," he added.
Beyond Meat (NASDAQ:BYND) has been "testing" price cuts to attract customers by offering its core products at a price point that is at or below their animal protein equivalent.
The company forecast 2023 revenue between $360 million and $380 million, compared with its prior expectation of $375 million to $415 million.
Beyond Meat said it was unlikely to meet its target of achieving cash flow positive operations within the second half of 2023.
"The guidance cut is disappointing, especially considering the decent start to the year. We are now back to talking about cash burn and the need to raise capital... Something needs to change to prevent this ship from sinking," said CFRA Research analyst Arun Sundaram.
Beyond Meat's quarterly net revenue fell nearly 31% to $102.1 million, missing analysts' average estimate of $108.4 million, according to Refinitiv data.
However, easing supply chain expenses and its efforts to control costs helped the company post a smaller-than-expected loss of 83 cents, compared with estimates of 86 cents.
The company had said in October it would cut jobs, which was expected to lead to savings of about $39 million over 12 months.
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Written By: Reuters
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