Beyond Meat reverses revenue slide by raising prices on its plant-based products

[November 07, 2024]  By DEE-ANN DURBIN

Beyond Meat reversed a sales slide in the third quarter, growing revenue for the first time since 2022 as it charged higher prices for its plant-based meat.

The El Segundo, California-based company said Wednesday its revenue rose 7.6% to $81 million in the July-September period. That was higher than the $80.1 million Wall Street was expecting, according to analysts polled by FactSet.

Still, Beyond Meat's shares fell nearly 6% in after-hours trading after it said it expects full-year net revenue in the range of $320 million to $330 million. That's at the low end of its previous forecast.

Beyond Meat said it saw a 7% decrease in the volume of products sold but a 15.8% increase in net revenue per pound. The company has been trying to rely less on discounting and position its newer, lower-fat burgers, sausages and grounds as premium products.

Among those new products is Beyond Sun Sausage, which is filled with bell peppers, spinach, lentils and other vegetables. Unlike previous products, Beyond Meat said the new sausage isn’t intended to replicate meat but to be a healthier protein option.

Beyond Meat President and CEO Ethan Brown said prices are rising on some products with premium ingredients such as avocado oil. But the company hasn't given up on its goal to make plant-based meat that costs the same as animal meat, he said. It's already meeting that target with some large food-service customers.

Beyond Meat is also selling older product formulations at lower prices, he said, and intends to keep doing that as it introduces updated products.

Beyond Meat products are seen in a refrigerated case inside a grocery store in Mount Prospect, Ill., on Feb. 19, 2022. (AP Photo/Nam Y. Huh, File)

“I don’t think this is a case of Beyond Me just decided to become a niche brand going after affluent customers,” Brown said on a conference call with investors. “It’s much more diverse than that, much more nuanced than that in our pricing.”

Beyond Meat said its U.S. retail volume in terms of pounds sold fell 6.6% in the third quarter but food service sales were up nearly 8%. Food service sales benefited from an expansion of Beyond Meat sales at Panda Express during the quarter.

Outside the U.S., that pattern reversed; Beyond Meat's international retail sales were up 6% but its food service sales dropped 22%. Brown said Beyond Meat began selling its products at German retailers after working to meet their shelf-life requirements. It also launched plant-based nuggets at 1,500 McDonald's stores in France, although it saw lower sales in some other European markets.

Beyond Meat said it narrowed its net loss to $26.6 million for the quarter, compared to $70.5 million in the third quarter a year ago. That loss, of 41 cents per share, also beat analysts' forecast of a 48-cent loss.

Brown said the company has made substantial progress on cutting its costs and consolidating its operations. He noted that Beyond Meat hit its lowest cost-per-pound in the third quarter since 2021.

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