Beyond Meat, Inc. (BYND) on Q3 2021 Results - Earnings Call Transcript
Operator: Good afternoon, ladies and gentlemen and thank you for standing by. Welcome to Beyond Meat Incorporated, 2021, Third Quarter Conference Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. Please note this conference is being recorded. I will now turn the conference over to your host, Lubi Kutua, Vice President, FP&A Investor Relations for Beyond Meat. Thank you. You may begin. Lubi Kutua: Thank you. Good afternoon and welcome. Joining me on today's call are Ethan Brown, Founder, President, and Chief Executive Officer, and Phil Hardin, Chief Financial Officer and Treasurer. By now, everyone should have access to the Company's third quarter earnings press release, and investor presentation, filed today after the market closed. These documents are available on the Investor Relations section of Beyond Meat 's website at www. beyondmeat.com. Before we begin, please note that all the information presented on today's call is on audited and during the course of this, call, management may make forward-looking statements within the meeting of the federal securities laws. These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Forward-looking statements in the earnings release that we issued today, along with the comments on this call, are made only as of today and we will not be updated as actual events unfold. Please refer to today's press release, the Company's annual report on Form 10-K for the fiscal year ended December 31st 2020, the Company's quarterly report on Form 10-K for the quarter ended October second, 2021, to be filed with the SEC and other filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Please also note that on today's call management will refer to adjusted EBITDA, adjusted gross profit, and adjusted net loss, which are non-GAAP financial measures. While we believe these non-GAAP financial measures provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Please refer to today's press release or the investor presentation for a reconciliation of adjusted EBITDA, adjusted gross profit, and adjusted net loss to their most comparable GAAP measures. And with that, I would now like to turn the call over to Ethan Brown. Ethan Brown: Thank you, Lubi and good afternoon, everyone. Before discussing our Q3 2021 results in detail, I want to provide context for my commentary and clearly differentiate between short-term variability on the one hand, and ongoing strong progress toward our long-term vision of becoming tomorrow's global protein Company on the other. The broader context of my remarks can be summarized in 2 main points. First, my comments, are our best understanding of an environment that is characterized by rapidly changing and we believe largely transitory dynamics. We are reminded, for example, that the quarter-ago Q2 2021, we posted record net revenues of a $149 million. We believe our long-term thesis is strengthening and undeterred by current instability. We've been making bold investments in our innovation, manufacturing, operations, and sales and marketing capabilities across the U.S., EU and China. We make these investments not as hopeful thinking, but rather prudent planning against forthcoming launches and strategic growth activities. Second, my comments today are focused on the entirety of the quarter, how the business performed relative to our expectations as we began 2021, and our promising path forward. The headline for the third quarter relative to our expectations at the onset of 2021, is that it was a difficult operating environment. Highly variable demand, reflecting the Q2 retreat and then Q3 reemergence of COVID in the form of the Delta variant. Sustained labor shortages impacting certain customers, as well as our own facilities and other high impact supply chain disruptions are among the challenges characterizing the quarter. As we headed into Memorial Day, we, like many in the country, felt that the long shadow of COVID was finally receiving. We saw growth in food service as restaurants and venues reopened to strong consumer demand and posted our forementioned record quarter in Q2, 2021. We began looking eagerly to resumption of activities with our strategic quick-serve restaurant partners, both in the U.S. and abroad. A key building block in our originally anticipated growth plan for 2021.Yet as the summer wore on and the Delta variant took hold, we did not see a sustained recovery. And as you will recall, in food service, COVID-19 disruptions in consumer behavior are particularly challenging for the segment of customers that we serve. Though in our largest active chain in the U.S. that does offer drive-through, we saw a meaningful uptick in velocity in the quarter. The majority of our customers today rely on in-store and in venue consumption for sales. Accordingly, we were disproportionately impacted throughout the quarter, as the Delta variant dampened consumer activity within the core of our food service customer base. Further, within food service, we believe that the downward pressure exerted by the Delta variant, was further exasperated by labor shortage that drove reduced operating hours and menu rationalization. For our business, the extent that moving from test to fuller launches with our strategic QSR Partners, is an important contributor to our revenue build. To combine contribution of COVID's long tail, and related labor shortages, has had a particularly disruptive that we expect transitory impact on our growth trajectory. In short, though as we planned 2021, we held cautious expectations by the second half of the year, we'd have our footing back in food service and specifically be more active with many of our QSRs we saw further delays. Unlike 2020 when food service challenges led to a market increase in retail activity, as food service demand reduced, we did not see a corresponding increase in activity in retail or the brand or category level during the third quarter. We believe that the following broader behaviors and trends may be at play. This expectation is not intended to be exhaustive and with time, we expect we will gain a fuller understanding of the drivers behind third quarter demand levels. 1. Consumers reported few or less frequent trips to the store. 2. Consumers reported being less open to trialing new products. 3. Consumers reported less interest in healthy options. 4. The cancellation will reduce scope of our sampling programs as the Delta variant spread limited new consumer exposure to our brand and category. 5. Too much lesser extent than food service that's still relevant, labor issues created complexity and possibly impacted demand retailers, do delayed shelf resets and less frequent restocking. 6. With increased competition over the past two years, we're seeing as expected, some impact on our market share. However, in looking at the Q2 to Q3 spins market share data, on a product mix neutral basis, it does not reveal competition to be a significant attributor, to be forementioned deceleration. Finally, when considering demand, it is worth noting the possible impact of our Q2 2021 revenues. We experienced a significant increase in shipping, towards the end of the Second Quarter, driven in part by retailers stocking up for July 4th, and the balance of summer grilling season. And food service operators anticipating at broader reopening of the economy. We believe these heavier levels of shipping during the last month of Q2, likely negatively impacted Q3 reorders. Turning to supply chain, we experienced a series of disruptions throughout the quarter: These included 1. labor shortages in our facilities at a transportation partner at co-packers and at third-party logistics providers. Collectively, these labor issues added complexity across operations and impacted our ability to fill certain orders. 2. Additionally and significantly, severe weather interrupted water supplies for 2 weeks at our Pennsylvania production facility, as well as destroyed sizable amounts of packaging inventory at a related storage center. Though we were able to reallocate certain materials from other locations, the loss of packaging materials at our storage facility had a sustained impact on our ability to fill orders as we awaited the punishment of damaged inventory. I do want to take a moment to discuss the general balance of exogenous and internal factors that contributed to our results this quarter. As you know, at Beyond Meat, we're highly focused on driving with urgency, continuous improvement in our products. This cultural bent is captured in multiple ways, including the language we use to describe our processes, such as the long-standing, Beyond Meat rapid and relentless innovation program, our internal innovation initiative. We applied the same lens of continuous improvement to our own organization and this difficult operating environment highlighted areas of opportunity in our maturing Company. As labor challenges, severe weather, and an explosion at one of our key suppliers, each interfered with our operations in Q3, we worked to materialize planned redundancy more rapidly across our supply chain. Further, we encountered delays in some of our commercialization efforts, certain of which highlighted the need to expedite the consolidation of our scaling activities within a dedicated commercialization facility here in Los Angeles one that is now underway. I think weathered both literal and figured of storms throughout the quarter, that brought into sharper focus areas for more rapid development, we are emerging as an even stronger organization. These disruptions notwithstanding, through Q3 2021, we remained highly focused on the execution of our long-term strategy. And accordingly, we are pleased to report that we continue to gain ground across key enablers of our long-term growth. Broadly, we've invested heavily in readying an impressive range of products for our QSR partners put significant resources against expanded capacity for planned launches. Our efforts are of course, not limited to the U.S. market. As in the U.S. in the E.U. and China alike, we continue to strengthen and grow our capabilities, including sales, marketing, manufacturing, operations, and innovation, among others, as we expand our presence in these important global markets. Finally, we expect next month to announce an exciting addition to our leadership team and operations, when they will bring valuable and directly relevant experience in serving our QSR partners and scaling global food manufacturing operations. With this context as background, I will now provide greater detail into our Q3 results. We generated net revenues of $106 million, representing a 13% increase over the third quarter of 2020. Total retail net revenues were up 5% year-over-year, with continued strength in international retail, which increased 168% year-over-year, partially offset by weaker results in U.S. retail, which declined 16% year-over-year. Representative of the unusual patterns we're seeing, our third quarter U.S. retail net revenues were lower on a sequential basis, which runs counter to the general seasonality we were accustomed to seeing in our pre -COVID numbers. Our leadership position in U.S. retail continues to be born out in product sales rankings, where we maintained our number 1 top-selling skew position across all of plant-based meat and continue to own 4 of the top 6 best-selling skews in the category. Further, we gained distribution with a 23% increase in TDPs versus a year ago. According to spin data for U.S. MULO, for the 12 weeks ended October 3rd. As you know, increasing TDPs is a positive outcome for our brand over the long run, potential exert downward pressure on velocity. Specifically, we saw a 21% year-over-year decline in velocity for the brand in U.S. MULO for the same period. These dynamics notwithstanding, our brand velocity remains nearly 3 times higher than the category average on an absolute basis, which we believe strengthens our case for further distribution expansion with retailers. We continue to see consistent progress in important metrics such as household penetration and repeat rates. But household penetration for the category was down slightly on a sequential basis. We know continued advancement in our own penetration, which increased 20 basis points sequentially and 90 basis points year-over-year to 6.4% according to SPINS IRI Consumer Panel Data for the 52 weeks ended October 3rd 2021. With more households buying our products, we were pleased to see that our repeat rates also increased 60 basis points sequentially to 52.6%. Our buyer rate decreased 4% sequentially, likely impacted by higher promotional activity in Q3, while our purchase frequency was modestly lower, quarter-over-quarter to the tune of negative 0.3%. We continue to innovate in the retail space and just recently began the early stages of a national roll out of Beyond Chicken Tenders. This product derived from faba beans is a clear winner on taste, texture, and nutrition, as it delivers 50% less saturated fat than traditional chicken tenders, while containing no GMOs, antibiotics, hormones or cholesterol. We're pleased to report that right out of the gate, Beyond Chicken Tenders won the prestigious 2021 Food and Beverage or five-year award from the National Restaurant Association. You should expect to see more from us under this platform in the near future as we seek to offer a broad assortment of product offerings that grow our chicken portfolio. Turning to U.S. food service, we've maintained our number 1 brand position in terms of dollar share according to NPD data for the 3 months ended September 2021, despite the intense variability from Q2 to Q3. Net revenues decreased 7% year-over-year and were as noted, well, below our Q2 total. As I shared a good portion of our U.S. food service business, about 2/3 historically. But even higher now, is composed of outlets that were disproportionately impacted by COVID-19 and the emergence of the Delta variant. These include small independent restaurants, bars, and pubs, corporate catering services, hotels, movie theaters, shopping arenas and amusement parks, among others. Internationally, our business again generated strong results with retail sales up a 168% year-over-year and food service sales up a 117% year-over-year, collectively, reflecting gains in both distribution and average sales per outlet. I will now provide a brief update on some recent product highlights in key strategic initiatives. McDonald's initiated limited time offerings of the McPlant Burger made with Beyond Meat patties in 3 European markets, including Austria, The Netherlands, and the U.K. In addition, as you've likely noted last week, McDonald's initiated a small limited time operations test in 8 restaurants here in the U.S. We are excited to work with such an iconic global brand as McDonald's, and we're equally excited to see the overwhelmingly positive media response generated by the early tests in Europe. At the end of October, I was visiting our facilities in the Netherlands and have the opportunity to buy the new plant burger. It was as expected, outstanding. On returning to the U.S. the following week, I was able to do the same in Los Angeles. In both instances, I watched and interacted with other consumers, as they enjoyed the McPlant. Encouragingly, these consumers fit the mold of the flexitarian, and while not vegan or vegetarian, were enjoying the McPlant Burger. In Canada, we introduced Beyond Meat Nuggets nationwide at A&W on a limited time basis, marking another great milestone within our earliest QSR partners. This exciting product offers 18 grams of plant-based protein for 6 pieces serving, and as always, is made from simple, plant-based ingredients, with no GMOs, antibiotics, hormones, or cholesterol. Also in food service, Pizza Hut launched a limited rollout of our latest product innovation Beyond Pepperoni at roughly 70 locations across 5 U.S. markets. This new product, co-developed with Pizza Hut culinary team's, truly showcases the strength of our innovation capabilities, as we overcame numerous technical challenges to ensure that beyond pepperoni is nearly indistinguishable from Pizza Hut 's iconic original pepperoni, even down to its crispness properties. This limited offering at Pizza Hut in the U.S. comes on the heels the permanent menu launch will beyond me products at Pizza Hut U.K. and July. Given Pepperoni 's consistent ranking as the number 1 selling pizza topping in the U.S. and elsewhere. We are excited about the potential of this product line and are eager to expand its availability over the coming quarters. Last but certainly not least, in the food service space, we recently announced the expansion of our test with Panda Express to 10 major markets across the U.S. at 70 locations. This follows the initial success of Beyond the Original Orange Chicken at select Panda Express locations in Southern California and New York City, which garnered raised consumer and media reviews and sold out in less than 2 weeks at all, SoCal stores, making one of Panda's most successful regional launches to date. We are proud to be Panda's partner of choice to recreate their iconic and most popular menu item. But let me now provide a brief update on our progress in growing our operations in the EU and China. We're now capable of performing each aspect for production process in-country, in the Netherlands and China, from production of our dry blends to extrusion, to finished goods assembly. Moreover, in the Netherlands and China, we're operating our highest throughput extruders yet. For some time now, we've been building towards full end-to-end production to both geographies. And reaching this milestone is a major accomplishment for our team. I'm extremely proud of them and their work. As you can imagine, scaling complex processes in different economies around the world can be challenging. Doing so during the last 18 months under COVID-19 conditions, complicated the work of our employees considerably. And just one example, due to travel restrictions to our Jiaxing, China facility, we're required to conduct a significant amount of scaling activities with new staff over video conferencing equipment. We continue to pursue our global cost-down program with the end goal of price parity with animal protein in at least to 1 category: beef, pork, or poultry, within the next 2.5 years. Today, we are working through a robust pipeline of cost-reduction opportunities, including in the areas of raw ingredient procurement savings, waste reduction, throughput improvement, network optimization, including potential in-sourcing opportunities, warehousing and transportation efficiencies, before mentioned local production in our global markets and packaging optimization. With these efforts already underway and those still to come, I feel very confident about reaching our cost parity goal within the committed timeline. In closing, it remains our objective and focus to insulate our long-term strategy from short-term conditions. Just as we did not adjust our focus and strategy as a result of record revenues in Q2 of this year, continue to execute against our plan, despite a difficult third quarter. As such, this remains a period of intense investments in our future. And abroad, we will continue to make the innovation, commercialization, marketing, and global production investments necessary for long-term growth. These investments are not founded on hopeful thinking, but rather are the result of planning against key partnerships, market development initiatives, and other opportunities, many of which have been delayed due to COVID-19 and the Delta variant, labor shortages and supply chain challenges, including our own and those of customers. One of the benefits of being a relatively new public Company, whose early experience in the public markets has been forged for the last 18 months, is enduring multiple stress tests that reveal both strengths and weaknesses, and generate accelerated learning. We are emerging from the pandemic and its attendant challenges, far stronger as a result, and are continually making progress on our long-term growth pillars of taste, nutrition, and cost, as we prepare for 2022 and beyond. With that, I will now turn it over to Phil to walk us through our third quarter financial results and outlook for the balance of the year. Phil Hardin: Thank you, Ethan. And good afternoon, everyone. Let me provide a broad overview of our third quarter financial results before commenting on our outlook for Q4. We achieved net revenues of $106 million in the third quarter of 2021, representing an increase of 13% compared to the third quarter of 2020. Q3 2021 net revenue fell short of our initial guidance and we provided a press release on October 22nd outlining the factors we believe led to our revised revenue guidance of approximately $106 million. So, I will not repeat those factors here. Growth in net revenues was primarily driven by a 143% year-over-year increase in sales to international customers. Partially offsetting the increase in international U.S. net revenues declined 14% in the third quarter of 2021, compared to the third quarter of 2020 with U.S. retail down 16% year-over-year, and U.S. food service down 7% year-over-year. Taking a closer look at our distribution channels in retail across the U.S. and international, our volume of products sold increased 8% year-over-year with international up a 123% and the U.S. down 9%. Net revenue per pound for total retail was lower by approximately 2% on a year-over-year basis, primarily reflecting increased trade discounts in the U.S. In food service, total volume of products sold increased 24% year-over-year, with international up 55%, and the U.S. down 3%. Net revenue per pound for total food service was up 8% year-over-year, driven by reduced trade discounts in international compared to the year-ago period. Moving down the P&L to gross profit. Gross profit in the third quarter of 2021 was $23 million or 21.6% of net revenues, as compared to $25.5 million or 27% of net revenues in Q3 of 2020. In Q3 2020, adjusted gross profit which excludes $1.8 million of expenses related to inventory write-offs, and reserves and product repacking costs, attributable to COVID-19, was $27.3 million or 28.9% of net revenues. We incurred no such costs in Q3 2021, so our gross margin and adjusted gross margin for Q3 2021 are the same at 21.6%. The year-over-year decrease in adjusted gross margin was primarily driven by increased transportation costs, inventory write-offs, warehousing fees, depreciation, and amortization, partially offset by improved co-manufacturer fees. On a sequential basis, decrease in gross profit was driven by increased sale discounts, increased inventory write-offs, increased warehousing, transportation costs, and depreciation in amortization. Turning to OpEx, total operating expenses were approximately $77 million in the third quarter of 2021, as compared to $44 million in the year-ago period. A year-over-year increase in operating expenses primarily reflects growth in overall headcount levels, mainly to support the Company's operations, innovation, and marketing capabilities. Increased spending in marketing activities, higher professional services fees related to recently established consulting agreements, higher restructuring expenses, primarily reflecting increased legal expenses, increased production in trial activities, and higher outbound freight costs included in the Company's selling expenses. On a sequential basis, the increase in operating expenses primarily reflects higher professional services fees, increased marketing activities, higher restructuring fees, and increased outbound freight costs. Net loss in the third quarter of 2021 was $54.8 million or $0.87 per common share as compared to net loss of $19.3 million or $0.31 per common share, and adjusted net loss of $17.5 million or $0.28 per common share in the third quarter of 2020. Adjusted EBITDA was a loss of $36.8 million or -34.5% of net revenues in the third quarter of 2021 compared to adjusted EBITDA of $4.3 million or -4.5% of net revenues in Q3 2020. Turning to our balance sheet and cash flow highlights, our cash and cash equivalents balance was approximately $886 million and total debt outstanding was approximately 1.1 billion as of October 2nd, 2021. For the 9 months ended October 2nd, 2021, net cash used in operating activities was $191 million compared to $42.7 million in the year-ago period. Capital expenditures totaled $104.3 million for the 9 months ended October 2nd, 2021, compared to $38 million for the year-ago period. The increase in capital expenditures was primarily driven by continued investments in production equipment, facilities related to capacity expansions, and initiatives. Let me now provide some commentary about our near-term outlook. Overall, we continue to operate in a challenging and variable macro environment, affected in part by ongoing uncertainty related to COVID-19, labor issue at both retail and food service customers, significantly increased transportation costs, raw ingredients and packaging inflation, and global supply chain challenges which have had a minimal impact on our business thus far, but could represent potential headwinds nonetheless. Combined is the dynamic nature of our category which remains nascent. This backdrop adds significant variability to our realized end customer demand, thereby increasing forecasting complexity. As such, although our outlook does not assume a significant deterioration in the operating environment as it stands today, it does reflect some conservatism, which we believe is appropriate, given the challenges I just highlighted. For the fourth quarter of 2021, we expect net revenues to be in the range of $85 million to $110 million. The following factors worth highlighting are embedded in this guidance. First, we anticipate a moderation in year-over-year growth across all channels due to the fact that this year, our fourth-quarter contains 5 fewer shipping days compared to the fourth quarter of 2020. Second, we expect our fourth quarter results to be impacted by knock-on effects from the operational challenges in Q3. Although we expect to be fully recovered by the end of this month, these issues presented some headwinds early in the quarter. Third, in both U.S. and International food service channels, ongoing labor challenges, as well as general caution based and COVID -related uncertainty are also expected to have a dampening effect on the . Finally, we expect a moderation in sequential growth due to accelerated orders in the third quarter of 2021, that would otherwise have been expected to materialize in the fourth quarter. In terms of profitability as Ethan described, we continue to invest in support of our long-term growth strategy, which includes investment in people and infrastructure. Moreover, with our expectation of accelerating food service activity next year, including in the QSR space, we are maintaining a robust schedule of product deduction trial activities to prepare for the commercial launch of due product innovation. We're investing in marketing activities to drive awareness in trial. We expect to see a steady increase in the pace of cost-down initiative implementations, some of which require upfront investments. These activities will continue to exert pressure on our profitability in near-term. However, given the long runway we continue to see ahead of us in the global plant-based meat category, and in order to maintain and expand our leadership position within the sector, we believe these early levels of investment are necessary and will ultimately maximize value for our shareholders over the long term. With that. I will turn the call back over to the operator to open it up for your questions. Thank you. Operator: Thank you. At this time, we will be conducting a question-and-answer session. One moment, please, while we poll for questions. Our first question is from Bryan Spillane with Bank of America. Bryan Spillane : Hey. Good afternoon, guys. Ethan Brown: Hey, Bryan. Bryan Spillane : I just had 2 -- I guess, 2 related questions just on how we should be thinking about expenditures going forward. I think there's still about $800 million of cash on the Balance Sheet related to the convert you did earlier this year, and so just trying to get a sense of how quickly that money is going to be deployed. And again, assuming some of that is infrastructure, some of that is going to be hiring people. Just trying to get a sense of the cadence of that, I guess as we begin to look over, maybe the next year or 2? And then maybe just a second related on expenses. I think Ethan, we might have talked about this on the last earnings call, but some of the commentary you made about just what you are observing with consumers, especially in U.S. retail, seem to suggest that maybe consumers are not getting the message for lack of a better way to describe it. So, do you see a need maybe to not just increase marketing spend, but to really maybe sharpen the message a bit so consumers understand the health proposition, the taste proposition of the products? Ethan Brown: Great, both good questions and so let me begin with a more general view on the first around kind of pace of spend and I want to even take a step further back than I did in the comments to give my perspective on what this quarter was about. A lot of different disruptions that occurred throughout the quarter. But if you look at where we've been in the second and third quarter of this year. I think we had 149 last quarter and 106 this quarter. If you take the average of those 2 each, 127.5. That were our results this quarter, right? You'd be -- we'd be up 30% year-over-year. So, I'm not excited either way on these results other than to say that there's a lot of lumpiness in timing issues in them. And so, the stand that you see is not stand against the current activities, right? It's really about the future of that is I think around the corner for us, and that relates to all these deals that you've heard about over the last 12 months, whether it's the joint venture with Pepsi and the planet partnership and I think they were public about putting a product into the market next year in 2022. With that, you look at the McPlant tests here in the U.S. and then the larger activities in the Netherlands and Austria and the UK, for example, which from everything I've seen in the media with you guys are seeing, so not speaking for McDonald's, but just characterizing what you see in the press, those have been successful. And then you look at the activities across our Yum! partnership, whether it's KFC in China or Pizza Hut here in the U.S. for the Pepperoni test or Pizza Hut with ongoing distribution in the UK of three different Beyond toppings. And then of course you heard Taco Bell or this year talked about plans with us. All of these things are accumulating within our system and requiring us to, in a good way, to make investments to be able to serve these future opportunities. You go into whether it's Canada and A&W or the Panda Express here in the U.S., you look at continued roll out of new products in retail. Of course, internationally we're making significant investments and as I mentioned in my comments, just got back from the EU, both in the EU and China. And so, all of those are not about this year and these results during this period of what we would characterize as stability, but rather for 2022 and beyond. And so, I think it's an opportunity for us to continue to lay the core foundation of our future growth. And so, if you were to look in the years ahead and start to think about what type of revenue would come in from those opportunities, I think this level of spend in OpEx is entirely appropriate for those. So, I don't know if you guys want to add any further details of that. Phil Hardin: But I guess the only thing I would add, this is Phil. One thing that we talked about is make sure we maintain flexibility and use a mix of co-manufacturers and our own manufacturing. And so, as we look forward, we'll continue to look for what best allows us to serve our customers will realize the best economics and give us flexibility there. So that'll be a factor in this as well. And we know potentially with doing some of our own manufacturing versus commands, there's potential cost implications that are favorable. And so, we're going to weigh all those things in addition to supporting our customers and looking at new products. Ethan Brown: Just to circle back on my comment, if you -- I wouldn't expect continued acceleration of OpEx mending sort of per year-upon-year, right? What we're doing is building to a particular loss point that we see in the pretty near future versus this setting the trend for percentage of revenue OpEx for many years forward. Bryan Spillane : Okay. So fair to say the environment hasn't discouraged you, like you're spending what you need to spend to get where you want to get from a revenue perspective over the next year or two? Ethan Brown: Yeah, absolutely. No, it has not discouraged at all. I think the work we're doing is foundational relaying, I think is quite strong. Bryan Spillane : Then Ethan, just on the marketing message, anything that needs to be there? Ethan Brown: Yeah. No, I think it's a great question. I think we need to continue to -- the reason we did the Stamford work and we had great results from that clinical trial, was to create more data around the points of the health benefits of our products. And we have a 5-year program that we're doing with the Stamford to continue to do studies in that regard until coming out stronger in '22 with our health message, I think is important. And then of course, I think more and more consumers now are really focused on climate, right? And so, you've heard me say in the past that that's something that we market best directly around, but to the extent we can empower consumers who are feeling pretty helpless about what to do in their on individual lives about this. We're going to talk about that as well in 2022. So, I think you'll see our most aggressive marketing to date in terms of focusing spend on those broader attended benefits of our products. Bryan Spillane : All right. Thank you. Ethan Brown: Yes. Operator: Our next question is from Alexia Howard with Bernstein. Alexia Howard : Good evening, everyone. Ethan Brown: Hey there. Alexia Howard : Can you hear me, okay? 2 questions. Ethan Brown: Yes. Alexia Howard : The first one is around key prices. We've obviously seen those surge on the yellow tea price by over 100% over the last year. And then recent months, it's really jumped up. How much do you already have contracted out in contracts that are already captured fiscal '22, given your demand expectations and what could that do to margin? That's the first question, and then the second one is more around the demand side here in North America, particularly in the retail channel. I think you showed in the presentation that the repeat rates were improving sequentially, do you have numbers around that having helpful penetration? You also mentioned was up sequentially and yet the retail sales were down sequentially quite a bit even as velocity trends and total distribution point seem to be up sequentially on a year-over-year basis, if that makes any sense. I'm just trying to wrap all that up together and try and figure out what's going on with the demand and whether it has stalled somehow in the U.S. or well, at a category level, or whether it's really more somehow supplier-related and all the other challenges you've been facing. Thank you. Ethan Brown: Very good question, thank you. So, I'll take the second one first, and then turn it to Phil for the question on pea protein, which I think we've a nice answer for. On -- it is an interesting thing, right? So, you're seeing household penetration increase, I think were up at 6.4%. That's about 28 points -- basis points sequentially in about 90 basis points year-over-year. And then repeat rates, so more households buying it and then people enjoying the products and buying it again, I think up around 2.6%. So, feel good about those. Then you look at broader brand awareness and we had the number 1 spot now in total brand awareness, displacing MorningStar for the first time. And then the alternative that number 61% brand awareness, which is compared to an average of less than 30% for other leading plant-based brands. So, we're really still doing what we sit out to do, which is to lead this movement. And we're still the number 1 product in retailer as I mentioned for the top 6, now more than food service according to NPD data. So, all these things would suggest that a quarter like this wouldn't happen. And I think that's what's so unusual about this quarter is I think in the absence of complete information, people try as hard as they can to come up with various theories, and I'm resisting doing that, other than to say that there's just unusual consumer behavior to things that I outlined in my comments, whether to people, because of the Delta variant, spending less time in the retail markets. being less open to trial and the absence of sampling programs that have been so important to us in the past, I think all of these factors are coming together. Some of the trends around what type of food, to what people are making to create an unusual quarter for us. But there's no indication in my view that coming off of a record quarter of revenue. In the second quarter to this quarter there's some fundamental change in the consumer mind set toward our products and I think that the, all the activities that I just mentioned going forward with our partnerships suggest in fact the opposite that things are strengthening. So, my view on the year, is to get through the year with these unusual conditions, and get to back to a strong resumption of growth, which I feel very confident about for 2022. I think on the supply side, yeah, they were considerable issues on the supply side. We had ongoing issue throughout the year around labor tightness, which everybody felt. And then we had this severe weather in Pennsylvania which took out production in our facilities for up to 2 weeks and then ruined packaging. So, we had a long tail on that one. So, these -- all these different factors came into play, and the reason that we brought the fourth quarter into the type of range that we did was we just didn't want to go into this fire drill again. The only -- the most immediate predictor of the future is what just happened. And so, we want to guard against having to run through another set of challenges. So, I feel really good about 2022. I feel cautiously optimistic about the balance of the year relative to what we got -- we gave you guys. And I think it's good to have this quarter behind us. Phil Hardin: I'll take that pea protein question. So, we have fixed price agreements in place for most of our pea protein supply, so we don't expect to see impacts from PPI in the near-term. Alexia Howard : Great. Thank you very much. Phil Hardin: PPI is pea protein isolate. Operator: Our next question is from Adam Samuelson with Goldman Sachs. Adam Samuelson: Yes. Thank you. Good evening, everyone. Ethan Brown: Hey, Adam. How're you doing? Adam Samuelson: Hi. Ethan, I was hoping to maybe think a bit longer-term, because obviously a lot of noise in the short-term. And as we think about a potential pathway to return to growth, clearly, international expansion and some of your bigger QSR kind of food service launches or some of the big increments. They could be coming over the course of the next 12 to 18 months. And I guess, as we think about the revenue mix, pre -COVID 2019, your business was basically 50-50 retail and food service. You were much more U.S.- centric because you started international. But now you've got manufacturing in Europe, you have manufacturing in China, some local production in Canada. How do we think about maybe 23, 24, what you would think is a good revenue mix between retail and food service in domestic and international? Ethan Brown: Yeah. And good question. Ethan Brown: I think currently we are about in the U.S. 78% retail, about 22% food service, which is a pretty big departure from where we were pre -pandemic. And I'm certainly running the business in a way that is investing very heavily in food service, and particularly in strategics open. So wouldn't be doing it if I thought 22% was going to hold. I do think you're going to see an increase in the food service business within Beyond and a significant increase as we get into more and more of the strategic accounts that we've been working with over the years. And if you look at just our performance even in this last quarter, something interesting is in that information which is at our largest, one of our largest QSR s that has a drive through that we're currently in as a permanent item. Our sales went up quite a bit in this past quarter year-over-year. So, I think that phenomenon that we talked about where consumers may be pulled back in retail due to some of the issues I mentioned and then as you would expect, a bump in food service to occur because of the challenges that mom-and-pop operations and venues, like sporting goods and concert calls, universities and that we're having. We didn't get the same pickup that you would have seen otherwise and I think that has to do with the distribution mix in food service that we've talked about a lot where we're I think now about 81% in independent operators and venues and things of that nature versus about 19% in these larger strategic accounts. And so, we're just not getting that. If you look at the trends, what's consumers today in food service, they're using fast foods, restaurants, primarily with drive throughs and things of that nature. Eating more fast food during the course of the pandemic and we weren't picking up on that because of the nature of our distribution. So, as we get into more and more food service accounts that are some of these larger TDPs. I think you'll see that grow. I don't know that we'll get to 50-50 and stay there, but I think you could expect it to approximate that kind of range, 60-40, 50-50, depending on the quarter. Adam Samuelson: And then U.S. versus international. Ethan Brown: Yes, U.S. and international. So yes, so U.S. and international, I think the mix now over about 63% U.S. 37% international. And I was really happy with the international growth. And I'll tell you something, when I was in Europe, so I'm the most critical of our products by far in terms of someone who is informed about all the different products in the market. There's a lot of activity going on in the EU and they did a nice store tour with our sales team and we went back to 1 of our production facilities and cooked up all the different samples from all the competitors, compared that against our products. And if I had found 1 that I thought was really good, the innovation team here would hear about it. The products are good, but ours are better. And that gives me great hope for Europe and you're seeing some really early results coming out of international work. In terms of the growth rates, I think we're up in 168% internationally. And so really, really bullish on the EU, we're taking a lot of investment there. We've got two facilities that are now also bullish on China, both with service and retail. I think we're up 100% in food service internationally so I would expect international going forward to be a very meaningful part of our business, particularly as we bring along these QSRs, not just in the U.S. And so, one other way to look at it is the activities we've had with McDonald's. So, as I mentioned in my comments, looks in the Netherlands had a terrific new plant there. But if you look at whether it's the test in the U.K., in Austria or in the Netherlands. All reports of those from external sources, they've been positive and well received. Pizza Hut in the U.K. continues to be -- to do quite well as well. So as those type of test pick up and launches pick up, you'll see more and more international mix. Adam Samuelson: Also, since you're looking at international growth, we mentioned an accelerated order which would be an order that would be a little unusual versus what we typically see. We estimate that at approximately $3.6 million in international this quarter. Phil Hardin: That's helpful. That's a lot of color. I'll pass it on. Thank you. Operator: Our next question is from Rupesh Parikh with Oppenheimer. Rupesh Parikh: Good evening. Thanks for taking my questions. I just wanted to touch on the gross margin line. First, a housekeeping on Q3. Is there any way to quantify the inventory write-off in your adjusted gross margins for Q3? And then I've a follow-up. Phil Hardin: So, in Q3, 2021, the unusual item we mentioned it a couple of times was water damage in one of our warehouses that was predominantly packaging, that was about $1.9 million. Rupesh Parikh: And that was that's doing your adjusted gross margin number. Okay. And then secondly Phil Hardin: It's still in the GAAP gross margin number as well. Rupesh Parikh: For Q4, is there any -- is there any granularity you can give us in terms of how to think about gross margins is what we saw in Q3, maybe a good reflection on how to think about Q4? Phil Hardin: Well, I think there were some things that we're probably a little unusual in Q4. First, we mentioned trade discounts. We don't anticipate trade discounts quite as dramatically as we did this quarter. The inventory write-off, we already saw that was unusual. And then the only other thing to say, so we would expect improvements from both of those lines barring some other issue. We did capitalize some of the costs this quarter when we were running less than optimum as we struggled through some of this stuff. So, there is some costs on the balance sheet that will play out. So that would offset some of these other factors I just mentioned. Rupesh Parikh: Okay, great. And then I guess my -- just my last question. So, Ethan, we've heard from other players these challenges in -- growth challenges within the plant-based protein category. Just curious, your take on what's really happening out there. Is there -- is there incremental pressures did you see overall within the categories? I'd just love your thoughts on what's happening out there. Ethan Brown: Thank you. I think the thing that we're trying to kind of make sense of and the reason that I sum and then split the 2 quarters, and we just had a record quarter, right? So, we just posted 149 and got a just tremendous amount of excitement as foodservice came back on and then stopped. And so, there's so much unusual behavior going on with whether it's labor and stimulus checks, supply chain issues we've had, some of this, I think slowing introduction of innovation into the category just with all the different distractions going on. The fact that we've invested a lot of renovation monies into these large QSRs that are forthcoming and we typically lead the category in retail in that type of way. All of that I think is combined to just have a more dormant Q3 than I think people want it. So, I don't think there's any sector issue or any segment issue. We continue to see strong year-over-year growth in terms of overall annual revenue. And if you look at 2022 and the work we're doing there, I think it's tremendous excitement in our Company about what's coming. And so, there's a bit of a pause and have that pandemic and labor issues and supply chain stuff not interfere, I think this quarter would have been quite different. Rupesh Parikh: Okay. Great. Thank you. Operator: Our next question is from Peter Saleh with BTIG. Peter Saleh: Great. Thank you. Thanks for taking my question. I want to ask about the McPlant and the tests you guys are doing with Arizona when it's now available in the U.K. and couple of other markets. And that it recently -- is there anything you can share on initial performance that you're seeing there? And then Secondly, as it is being marketed there, can you give us a sense on how much of the marketing expense McDonald is picking up and how much maybe you guys maybe contributing. Thank you. Ethan Brown: Yeah. I can't share anything and I really want McDonald's to obviously take the lead on us not to take one, with good reason. So, all I can give you is the media reports that are out there, which have all been very positive, as well as my own experience as a consumer which anybody could do, asking people at the register and drive-through how's -- how it's going. And the results in Los Angeles, as you'd expect, had been amazing, from the information I'm getting just from talking to people at the register. But -- and then of course, the media coverage has been very positive. So, in terms of marketing, we wouldn't be able to disclose that. But the other consideration is Caesar operations tests. So, there's not a lot of, and I'm not sure all the European ones can be characterized this way, but generally there's distinction between operations test and then an advertise test. And so, in the U.S. for example, there's really no advertising. They want to see just how the back-of-the-house operates with these products. And so, I think one of the opportunities to get back to your earlier question for 2022 for us and a real mandate to our marketing team is it will be the biggest marketing year-over had. And part of it will be in supporting not only McDonald's, but other QSRs as we make the case to the American consumer and consumers globally that they can eat what they love by going into the stores they love and enjoying products that are from Beyond Meat benefits to them above and beyond what they get otherwise. Peter Saleh: Thank you for that. Very helpful. Just one last question on McPlant. Is there any reason to believe that they -- that McPlant with Beyond Meat would have any operational challenges? Is the product any different at all than a traditional beef patty, in terms of cook times, or the ability to get it made in that amount of time? Just wondering where the operational challenges may land? Ethan Brown: I haven't heard that there's any operational challenges within the back-of-the-house. And certainly, what I've seen from the stores that I've toured, they seem to be doing really well with it. It's a great product. I don't know if anyone following this had an opportunity to have it, but it just -- if you want some reassurance about where we're headed, go get a McPlant. Absolutely delicious, and we're excited about it. Peter Saleh: Thank you very much. Operator: Our next question is from Benjamin Theurer with Barclays. Benjamin Theurer: Perfect. Thank you, so much and good evening. Actually, along the lines on the roll out, etc., Ethan, can you share a little bit the cadence, how you expect this to further roll out? And if within the guidance for the fourth quarter, the rollout as it's happening in the UK, is that contemplated like a step-up change? I think there was an addition to you, so much and good evening it just a few weeks ago for more stores in the UK, it obviously started with low level, but it's adding up. Is that part of your guidance? That would be my first question. Ethan Brown: Yeah. I appreciate that. First of all, I appreciate the fact that you guys are asking questions on McDonald's because we've been talking about it for years and now, I can actually reference stuff going into stores. And all I can say again is it's been -- really need to see this. All the media reports are very positive, and the anecdotal information I have from going to different stores has been very positive, but they have to control everything about sharing the results to the cadence of the expanse. What I will say is that the investment levels you're seeing this year, not just specific to McDonald's, but specific to our entire foodservice platform have been significant because of what we expect in 2022. And in fact, some of the -- the addition that I mentioned to our management team is also -- can be revealing in terms of what we're looking for in 2022. Benjamin Theurer: Okay. Perfect. And then just to wrap my head around it. If we take a look at the performance in the most recent quarter, it really feels like a story of 2 worlds with the U.S. being very much impacted in both sides, retail and food service, but then on the other side, having the international business, that actually performed very well back on track. I mean, you've recovered some good stuff here. So, what would -- I mean, what is it in your hands would you can do. Putting a lot of the commentary and explanation outside, but what would you say in your hands would you can do to get the U.S. somewhat back on track and get this out of this declining growth rates because it was weaker on a sequential basis, was weaker on a year-over-year basis in the U.S. What is it -- what you can do, what are you focusing on, what do you need to do in order to make that work again on the U.S. piece, because international piece I'm not worried? Ethan Brown: No, thanks. A lot of the international, again, adding, I think we added 7,000 customers across the quarter internationally. I think one is just time, right? It is all of this noise again, like having a facility knocked out, having labor issues, all these, the Delta variant coming back and as I mentioned in my comments on they think were swimming. We were really excited about where we're headed for the summer, and then this news starts to creep out about the culprit returning and all these other issues. So much is time. Let's get some distance from that. That's the first thing. Second is our core items. They're terrific items and we're continuing to cost down those platforms. We're continuing to look at everything from packaging to how we market those in 2022. I think you'll see a rekindling of energy around our core items. And we're also laying renewed innovation, right? So, where there's a chicken that's rolling out, we'll get fuller distribution there. Or these things that you've heard about in the last year, that have been in the making, that we expect to come into fruition In the U.S., whether it's again the PLANeT Partnership, expansion across these QSRs that I've mentioned. And then it has an effect of giving us the opportunity to really spend the most we've ever spent on marketing, to educate the consumer about all these different places and get it, and the benefits, whether health or environment, etc. that come from it. So, I think let's get some distance from the kind of operational challenges of this environment. Let's continue to invest in our core because of the terrific products and we have great production there. Let's get the innovation out into the market, and let's go tell our story, right? And let the fog clear of the events of the last year. Go out there and tell a story. So, I feel enormously confident about where we're headed. The only reason we gave more tepid guidance on what quarter is just because we don't want to go through this again. And when you have the floods, and this pandemic, and the labor issues, you want to be a little more cautious. That's why we did what we did. Benjamin Theurer: Okay. As you always say, you're the biggest critics of your own product. The Beyond 3.0 it was -- you talked a lot about it last call to roll out going into summer season and obviously it seems like there was weakness in there. Have you -- can you share any direct feedback, customer feedback on the perception of the Beyond 3.0, and what it might need for you to do on innovation as you've just talked about innovation going forward? Ethan Brown: Yeah. I think there's so much noise in retail behavior of this past quarter. It'd be hard to draw conclusions from that, but if you look at, for example, the awards we've been winning, I think we referenced this last time on People Magazine and just got another award yesterday on the Burger call, nourish group. Anyway, so a lot of I think recognition around a continual march we have toward product improve -- around product improvement. So, I wouldn't take any one thing that we're looking to change on the Burger, it gets back to that acronym I was talking about FGAT; So, flavor, Gruma, appearance and texture. We're making improvements across all four of those and expect to release even better Burger in 2022. So -- but no particular element that we're focused on more than others. Benjamin Theurer: Okay. Perfect. Thank you very much. I'll leave it here. Operator: Our next question is from Jon Andersen with William Blair. Jon Andersen: Thank you. Good afternoon. Just a couple of quick ones. I was wondering if you've -- with the foodservice difficulties largely COVID -induced and the push-out of some of the roll out in foodservice, is it possible that that is having a second derivative effect on retail demand for your products? I've always thought of foodservice as maybe a great trial vehicle in addition, obviously, to a source of sales itself. And then a way to generate retail sales for at-home consumption. Is that something you thought about or think could be having an impact on retail demand as well? Ethan Brown: Yeah. Absolutely in the sense that -- in a lot of different ways actually, but the one in particular is, as we brought on some, I think significant talent, our marketing department in the last quarter, both on the shopper marketing side and in general marketing. And we have a terrific brand -- head of brand here, has been with us for a long time. This year would not have been the year to launch our national marketing campaign, just because we're going to get so much more out of it as we're in these large QSRs. And so, waiting until that moment to do it is a prudent use of resources. And so, we've held off from that. But as you get into 2022, when you start to see some of these protests and such come to fruition and longer-term deals, you'll see us make that investment to make sure the consumer knows that they can grab it at this fast-food place, in this convenience store, and in this grocery. And so yes, there is a synergy that we're looking to take advantage of as we're in both outlets, both channels and having a more dominant way. I also think there's this trend around consumer's is being fatigued. It seems that they're just going to their usual, they're going to -- they're getting a lot faster food than they were in the past that -- and because we're not in those locations right now. That has hurt our trial. And then, of course, you go into the retail environment where we're not allowed to sample, where samples are very awkward and limited and everything else, it's -- again it's a dismal operating environment and the more time we can get between where we were in the third quarter with all the challenges going on and where we expect to be in the near future, the better. Jon Andersen: Okay. And then you talked about the objective of getting to price parity again within 2.5 years, in 1 of your categories. I'm just wondering, what's the most -- what has to happen for you to do that? And are you committed to that at all costs or are there margin objectives or cost-out objectives that you're going to have to achieve in order to kind of reach that level of price relative to where you sit today. Ethan Brown: Yeah, I think the margin is not the already that we're expecting to pull this from. And I think seeing us kind of mid-to-late margin in various ways to be more geared toward that you want to make sure that this particular launch is as successful as it can be. And if we have line of sight to an operating model when production model where we can restore that 30% plus margin down the road, then you'll see us play around margin. But over the long run, it's the things that we talked about. It's continuing to drive down cost of raw materials, which there's an inflationary pressure across the board. But because of the new industry we're also getting the benefit of new entrants and people scaling and be able to offer cost reductions over time. We have a very big program here; Phil is leading it with an outside consulting group and we're making really good progress. So, I'm not backing away from that. I guess 2 and 1/2 years to meet it. I think it will be in beef. And we're getting a lot of help too because of the commodity pricing on pizza's going up. Pick their 20-year average like $2.07. But of course, right now and in the future, we expect it to be considerably higher. So, I think we're well on our way. I have to be, exciting moment. When you can -- in fact, some of the products we're launching next year, you'll see us into that price parity. So, it's going to be interesting. Jon Andersen: Great. Thank you. Operator: Our next question is from Ken Goldman with JPMorgan. Ken Goldman: Hi, thank you. I know this is a tough question to answer, but do you have any best guess as to maybe what your annual sales number might have been, excluding the supply issues? Just trying to get a sense for sort of what it would have been if shipments have matched demand, so to speak. And again, I know -- more asking in a general sense because I know it's so hard to be precise there. Phil Hardin: This is Phil. I can give you what color is available. So, when we launched -- when we sent out the release on the 22nd of October, there were really three buckets in there: 1. was demand. That was the biggest, when you're looking at what happened versus forecast; 2. was the operational stuff with weather, it's the key driver. While it's definitely been a lot of headaches, I think that part is smaller than that initial bucket of demand, but that's about as much as we've saet at this point; and then 3. into this quarter, we're largely working through the last of the -- what we feel are the last of the knock-on effects. And so things definitely are getting kind of back on track at this point. So not enormous impacts, but certainly disruptive. Ken Goldman: Understood. I'll let it go there Thanks very much. Operator: Ladies and gentlemen, we have reached the end of the question-and-answer session. I would like to turn the call back to Ethan Brown for closing remarks. Ethan Brown: Thank you. So as I said, we really are looking to 2022 with a lot of optimism and that the investments we're making today continue to be focused on that future and not on sort of more difficult operating period that we're all experiencing. So I'm every bit as confident as I have been, and really look forward to getting back on the line with you guys in a few months here and sharing I think it will be good results and good commentary on where we're headed. So appreciate it. Everyone stay safe and I'll be in touch soon. Operator: Thank you. This concludes today's conference. Beyond Meat thanks you for your participation. You may disconnect your lines at this time.BYND Ratings Summary
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Beyond Meat Plunges 13% Following Q1 Results
Beyond Meat (NASDAQ:BYND) experienced a significant drop in its shares, falling more than 13% in pre-market today after the company reported a quarterly loss that was wider than expected, alongside a decline in annual revenue.
The company reported a loss of $0.72 per share for the first quarter of 2024, which was worse than the anticipated $0.66 loss per share. Revenue for the quarter was $75.6 million, down 18% from the previous year, but slightly above the consensus estimate of $75.37 million.
In response to financial pressures, Beyond Meat increased its prices this quarter. However, volume decreased by 16.1%, indicating that consumers are reducing their spending. Additionally, despite these price hikes, the company's profit margins were impacted by increasing manufacturing and material costs. The gross margin for the quarter was 4.9%, a decrease from the 6.7% recorded the previous year.
Looking ahead to the full year 2024, Beyond Meat is projecting revenue in the range of $315 million to $345 million, which closely aligns with the midpoint consensus estimate of $329.8 million.
Beyond Meat Stock Drops 8% Following $250 Million Securities Sales Plan
Beyond Meat (NASDAQ:BYND) shares dropped over 8% intra-day today following the company's announcement about its potential plan to offer and sell securities worth up to $250 million through various transactions. The offering could include an array of securities, such as common and preferred stocks, debt securities, warrants, purchase contracts, and units.
This announcement comes on the heels of Beyond Meat's earnings report released in late February, which revealed the company had $205.9 million in cash and equivalents and $1.1 billion in debt as of December 31. However, the filing did not confirm the commencement or certainty of any sales. Despite this news, Beyond Meat's stock had seen an over 15% increase in the past month, largely buoyed by its earnings results, but remains down by 6.6% for the year.
Beyond Meat is an Underweight at Piper Sandler
Piper Sandler analysts lowered Beyond Meat (NASDAQ:BYND) price target from $6.00 to $3.00 while maintaining an Underweight rating. The analysts' bearish outlook is based on ongoing pressure on EBITDA margins and a lack of significant sales growth.
Recent data shows a 19% revenue decline in the past eight weeks. This, coupled with volume and price decreases since January 2022, raises concerns about distribution and shelf space. Piper Sandler expects further near-term downside and has adjusted 2023 estimated sales from $375 million to $370 million and 2024 sales from $400 million to $375 million.
Beyond Meat Started With Underperform at TD Cowen, Shares Drop 5%
TD Cowen analysts initiated coverage on Beyond Meat (NASDAQ:BYND) with an Underperform rating and a price target of $10. As a result, shares dropped nearly 5% yesterday.
The analysts expressed concerns about the company's product quality and its fragile financial position. They noted that Beyond Meat is losing market share in the declining category of refrigerated plant-based meat alternatives, and while the company is taking steps to preserve cash and stabilize sales, the analysts believe that the financial risks and weak consumption patterns in the meat alternatives sector are significant challenges for the company.
Beyond Meat Plunges 17% Following Q2 Revenue Miss & Disappointing Guidance
Following the release of its Q2 results, Beyond Meat (NASDAQ:BYND) witnessed a sharp decline of over 17% in pre-market today.
The reported revenue for the second quarter was $102.1 million, reflecting a significant 30.5% decline compared to the same period last year. This figure fell short of the expected consensus estimate of $108.74 million. Meanwhile, the Q2 EPS stood at ($0.83), which was slightly better than the anticipated consensus of ($0.84).
The drop in revenue was primarily caused by a decrease of 23.9% in the quantity of products sold and an 8.6% decline in revenue for each unit of weight. This decline in product volume was largely due to sluggish demand in the product category, particularly noticeable in the company's U.S. retail and U.S. food service channels.
Looking forward, Beyond Meat predicts its 2023 revenue to fall within the range of $360 million to $380 million, which is notably below the Street estimate of $388 million.
Beyond Meat Plunges 17% Following Q2 Revenue Miss & Disappointing Guidance
Following the release of its Q2 results, Beyond Meat (NASDAQ:BYND) witnessed a sharp decline of over 17% in pre-market today.
The reported revenue for the second quarter was $102.1 million, reflecting a significant 30.5% decline compared to the same period last year. This figure fell short of the expected consensus estimate of $108.74 million. Meanwhile, the Q2 EPS stood at ($0.83), which was slightly better than the anticipated consensus of ($0.84).
The drop in revenue was primarily caused by a decrease of 23.9% in the quantity of products sold and an 8.6% decline in revenue for each unit of weight. This decline in product volume was largely due to sluggish demand in the product category, particularly noticeable in the company's U.S. retail and U.S. food service channels.
Looking forward, Beyond Meat predicts its 2023 revenue to fall within the range of $360 million to $380 million, which is notably below the Street estimate of $388 million.
