Beyond Meat (NASDAQ:BYND) reported disappointing quarterly results on Wednesday, missing market expectations for revenue and posting a wider-than-expected loss, largely due to a sustained drop in demand for plant-based meat.
The company is known for supplying its plant-based patties to fast food chains like McDonald’s and Yum! Brands has been forced to offer significant discounts as consumer sentiment regarding plant-based meat and its perceived health benefits has waned. In August, Beyond Meat referenced data from the Food Marketing Institute, indicating that the percentage of U.S. consumers who consider plant-based meats as healthy had declined from 50% to 38% between 2020 and 2022.
In the third quarter, net revenue fell by 8.7% to $75.3 million, a figure below the analysts’ average estimate of $85.4 million, according to data from LSEG. The company’s shares, which have witnessed a nearly 45% decline so far this year, saw a marginal dip in extended trading.
Rachel Wolff, a senior analyst at Insider Intelligence, noted, “Consumers in the U.S. haven’t fully embraced plant-based protein alternatives like Beyond Meat… because the products currently available on the market don’t meet shoppers’ expectations for taste and flavor.”
With rising inflation squeezing household budgets, consumers have leaned toward more affordable animal proteins rather than pricier plant-based options. Earlier this month, Beyond Meat revised its annual revenue forecast and reduced its gross margin expectations. The company also announced additional job cuts as part of a cost-reduction plan.
For the period ending on September 30, Beyond Meat reported a loss of $1.09 per share, falling short of market expectations, which had projected a loss of 89 cents per share.
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