Plant-based meat maker Beyond Meat urged investors to look past its mixed first quarter results Wednesday, saying a new, healthier burger hitting U.S. shelves now will help reignite weak sales.
“We really do believe we are at the early stages of a pivotal and terrific year for Beyond Meat,” President and CEO Ethan Brown said during a conference call with investors. “We’re doing the things you need to do to get through a period that’s challenging and return to growth.”
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The comments came after a bumpy first quarter that saw lower demand for Beyond Meat's burgers, steak and chicken in the U.S. and abroad.
The El Segundo, California-based company said its revenue fell 18% to $75.6 million in the January-March period. That was slightly higher than the $75.2 million Wall Street expected, according to analysts polled by FactSet.
It was the company's eighth straight quarter of year-over-year revenue declines.
Beyond Meat said U.S. retail demand was soft despite discounts on its products. The company said sales also fell compared to last year because it discontinued its Beyond Meat Jerky. U.S. retail and food service sales were both down 16%.
International retail sales fell 12%, reflecting lower demand for plant-based chicken, Beyond Meat said. International food service sales fell 29%. Beyond Meat said it was a tough comparison to the first quarter of 2023, when Beyond Meat filled a big order for McDonald's as its plant-based McNuggets went on sale in Europe.
Brown said inflationary concerns seemed to dampen demand for its products in some markets, including the United Kingdom and Canada. But he said Beyond Meat remains bullish about Europe, and noted that McDonald's recently expanded sales of its McPlant burger — co-developed with Beyond Meat — to Latvia, Lithuania and Estonia.
Brown said the fourth iteration of the Beyond Burger, which is rolling out to U.S. stores now, addresses consumers' concerns about the health of the company's products. It has 60% less saturated fat and more protein than its predecessor, for example. Beyond Meat plans a marketing campaign to spread the word about the new burger.
“We wanted to tackle that directly and try to make our products as unassailable on the health side as they are on the climate and environment and animal welfare side of things,” Brown said.
The burger will also be priced higher than the outgoing burger, reflecting its premium positioning, he said.
Beyond Meat signaled its confidence by reiterating its outlook. Beyond Meat expects net revenue in the range of $315 million to $345 million for the full year. The company reported full-year revenue of $343 million in 2023.
But investors appeared skeptical. Beyond Meat's shares plunged 15% in after-hours trading.
Beyond Meat’s first quarter net loss narrowed to $54.4 million from $59 million in the same quarter a year ago. Adjusted for one-time items, the company lost 72 cents per share. That was higher than the 67-cent loss analysts were expecting, according to FactSet.