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The industry of meat alternatives is facing challenges. In the US, interest in vegan burgers and sausages has decreased as the effects of the pandemic fade. Once the frontrunner in the plant-based market and the first of its kind to become publicly traded in 2019, Beyond Meat now serves as a cautionary example for similar enterprises on the arduous journey that lies ahead.
During the most recent quarterly report for 2024, Beyond Meat announced a mixed bag of results. While revenue saw an 8.8% decline, sales volume dropped by 14% compared to the previous year. However, the company managed to improve its product margins.
In an earnings call on a Wednesday, CEO Ethan Brown appeared optimistic about some of the outcomes of this quarter. He noted visible progress in meeting the targets for 2024 and the broader objective of achieving profitability in the long run.
In 2023, Beyond Meat experienced an 18% decline in revenue, totaling $343.4 million—numbers that exceeded market expectations but were accompanied by losses of $82.7 million. Sales in the US plummeted by 32.3%. The company has not yet recovered, reflecting a weak first quarter with revenue down by another 18%, reaching $75.6 million, largely due to lackluster demand in the US.
Europe has emerged as a brighter region for Beyond Meat in recent years. While US sales took a hit in 2023, international sales for the company increased. Notably, in the UK, Beyond Meat’s partnership with McDonald’s in offering McPlant burgers featuring Beyond Meat patties since fall 2021 was deemed successful, unlike a similar initiative in the US that remained at the trial phase.
Despite a decline in international sales, during the most recent earnings call, CFO Lubi Kutua highlighted the company’s strategic focus on expanding its presence in Europe. Kutua acknowledged the starting point of their operations in the EU as relatively small, emphasizing the potential for growth in the region.
Contemplating the path to profitability amidst challenges, an investor foretold in a February earnings call that Beyond’s business focus might pivot toward international markets. While Brown did not directly address this in the call, he did acknowledge the perceived politicization and misinformation surrounding the plant-based meat discourse in the US market, where the product has been embroiled in cultural debates against traditional animal-based meats.
The industry at large has been impacted by shifting consumer preferences. Immediate competitor Impossible Foods is exploring avenues to generate capital, whether through an IPO or a sale, with efforts to reposition itself for broader appeal among meat consumers. Concurrently, other vegan brands like Nowadays, Meatless Farm, and VBites have faced financial challenges.
Chris DuBois, an executive VP at Circana, suggests that the plant-based market remains a substantial billion-dollar sector, indicating enduring significance amid fluctuating consumer interests.
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