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Beyond Mear sun sausage-cajun-scramble Image credit Beyond Meat
Beyond Meat’s latest innovation—Beyond Sun Sausage—features spinach, bell peppers, yellow peas, brown rice, red lentils and faba beans, and is “not intended to replicate beef, pork or poultry,” says the firm. Image credit: Beyond Meat

Beyond Meat returns to growth, plans to boost the balance sheet before year end

November 6, 2024

Beyond Meat returned to growth in the third quarter, posting a 7.6% year-over-year rise in net sales to $81 million driven by lower trade discounts and targeted price increases.

While volumes were down 7.1% year-over-year, they have been on an improving trajectory in three out of four of Beyond Meat’s sales channels, CEO Ethan Brown told analysts Wednesday afternoon.

“We returned to growth, continued our gross margin expansion and reduced operating expenses to our lowest level in four years,” added Brown, who predicted full-year sales of $320-$330 million, at the low end of previous forecasts.

“We did a 22% increase in US retail pricing, which precipitated only a 6.6% decline in volume; that’s a pretty good trade off,” said Brown, who noted that any price increases were highly targeted. “But this is not a case of Beyond Meat deciding to become a niche brand going after affluent customers. We’re much more diverse than that, much more nuanced than that, in our pricing.”

We were surprised to see such strong U.S. Retail sales given the 14% decline in our consumption data. Management explained that the disparity was caused by new distribution wins and retailers changing their assortments that has not shown up in consumption yet, and to a lesser extent non-measured channels. The company announced a $200 million at-the-market equity program to support its cash balance. If fully utilized at $6/share, by our math, it would increase shares outstanding by 50%, thus presenting major dilution risk.TD Cowen 

$1.1bn debt

The firm, which posted a net loss of $26.6 million in the quarter, had a cash and cash equivalents balance of $134.9 million as of September 28 and a total outstanding debt of $1.1 billion thanks to a $1 billion+ offering of convertible notes made in March 2021 (when sales at the firm peaked) that will mature in early 2027.

The plan is to add additional liquidity to the balance sheet through an ‘at the market’ program (selling shares on the open market over time, instead of all at once) before the end of the year, while the firm will “pursue further balance sheet restructuring in 2025,” said Brown.

As for profitability, he said, “We were able to reduce our net loss by two thirds [vs Q3, 2023] as well as [reduce] adjusted EBITDA loss by two thirds. And so both the trajectory of that as well as the pace, I think is important… you can see a very steep curve moving in the right direction.

“And that’s why we feel so confident about our plan to bring the business into profitability. I can’t say when, and don’t imply it’s going to be anytime soon. But that is where we’re headed.”


Q3 2024 by the numbers:

  • Net revenue: +7.6% year over year (YoY) to $81 million, volumes -7.1%
  • Net loss: $26.6 million
  • Margins: Gross profit was $14.3 million with a gross profit margin of 17.7% vs -9.6% in the year-ago period and 14.7% in the previous quarter (Q2).
  • US retail revenues: +14.6% YoY to $35 million; volumes -6.6%
  • US foodservice revenues: +15.5% YoY to $14.5 million; volumes +7.9%
  • International retail: +17% YoY to $16.6 million; volumes +6%
  • International foodservice: -17.2% YoY to $15 million; volumes -22.1%
  • Full year 2024 outlook: Net revenues of $320-330 million
  • Balance sheet: As of Sept 28, 2024, Beyond Meat’s cash and cash equivalents balance was $134.9 million and total outstanding debt was $1.1 billion.
Source: Chart created by AgFunderNews using Beyond Meat financial reports
Source: Chart created by AgFunderNews using Beyond Meat financial reports

Beyond Burger v4 from Beyond Meat
Version 4 of the Beyond Burger features avocado oil (cutting the sat fat content to 2g) and 21g protein from peas, brown rice, red lentils and faba beans. Image credit: Beyond Meat

‘Increases in base velocity in certain large retailers’

Gross margins should continue to improve, said Brown, who has been reducing headcount and inventory and exiting co-manufacturing contracts over the past year. The company has also instituted price increases in the US to coincide with the rollout of its ‘Beyond IV’ platform and its new veggie-forward Beyond ‘sun’ sausages.

“We believe that Beyond IV’s clear health messaging and premium ingredients are contributing to a return to growth, where, for example, we are seeing year over year, increases in base velocity in certain large retailers on our flagship two-pack burger products.”

In international markets, Beyond Meat remains particularly bullish about Germany, “one of the strongest… plant-based markets in the world,” said Brown.

“Having worked several years to meet shelf-life requirements, we are thrilled to now be in [the refrigerated plant-based meat case in selected] German retailers. With a clear caution that it is very early days, we are seeing encouraging initial sell through in this important market.” In France, meanwhile, McDonald’s has recently launched Beyond Meat’s McPlant nuggets in 1,500+ restaurants, he said.

In the US, where Panda Express has just expanded distribution of Beyond Orange Chicken to nearly 600 locations, Beyond Meat continues to combat consumer perceptions of alt meat as highly processed, said Brown, who railed against attempts to “weaponize” the word “processed” to “undermine plant-based meat and preserve the status quo.”

He added: “The biggest thing that’s dissuading the consumer from our product and plant-based meat is a misperception around the health benefits and around the ingredients, full stop.”

His comments followed an appearance from Republican VP candidate JD Vance on the Joe Rogan show in which he urged listeners to “skip the nasty fake meat, which he blasted as “highly processed garbage.”

Plant-based meat by the numbers in US retail

While US retail sales of refrigerated plant-based meat alternatives have continued to decline, sales of frozen alt meat have started to stabilize, according to data from Circana.

In the 52 weeks to Sept 29, 2024, sales of refrigerated and frozen alt meat combined fell 9% year-over-year to $1.1 billion, while volumes dropped 9.9%.

However, there is a clear difference between the two temperature states. Sales of refrigerated alt meat (accounting for 29% of the category) fell 22.8% year-over-year to $22.6 million in September 2024 with volumes down 31.7%. However, sales of frozen products (accounting for 71% of the category), dipped only slightly by 1.3% to $54.3 million with volumes down 1.4% over the same period.

To place this in context, dollar sales of conventional refrigerated meat rose 5.5% year-over-year to $7.9 billion in the four weeks ending Sept 29, 2024, with volumes up 3.3%. Dollar sales of frozen meat & poultry, meanwhile, rose 8.3% year-over-year with volumes up 6%.

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