Beyond Meat has lowered its annual revenue forecast following a marked decrease in retail demand and growing challenges from competitors.
The plant-based meat brand stated it now projects revenue of $560M to $620M for 2022, down from estimates of $637.3 million, according to Refinitiv IBES data.
Due to widespread supply chain issues, as well as high marketing expenses, the brand reportedly lost $1.27 per share in the fourth quarter, compared to estimates of 71 cents per share. Its sales to U.S. grocers and other retailers also fell 19.5% in the quarter ending December 31.
A tighter market
Beyond Meat CEO Ethan Brown has noted the downshift in sales is a broader category trend, with U.S. retail purchases of plant-based meat falling 0.4% last year, following a huge surge in 2020. Beyond is also facing stiff pricing competition as Tyson, JBS and other conglomerates have introduced similar plant-based products at reduced price points.
“We experienced intense increased competition during the period when the size of the prize did not expand,” Brown stated during a Thursday earnings call.
Despite the setbacks, Beyond remains strongly optimistic for the year ahead. Brown believes the brand will fully recover its growth trajectory in 2022, pointing to stronger international market and foodservice performance. Beyond Meat’s historic partnerships with fast food giants such as KFC and McDonald’s will robustly support sales and product innovation going forward, Brown said.
Confident yet cautious
He also enthusiastically hinted at an “exciting” new product launch with PepsiCo, and says the company plans to resume in-store sampling following an unusual two years of pandemic-driven shopping.
Still, the lowered revenue forecast means Beyond Meat will be taking a more cautious approach.
“Though we will continue to invest during 2022, we expect to substantially moderate the growth of our operating expenses as we leverage the building blocks we now have in place to serve our customers, consumers, and markets — bringing forward our exciting and expansive future one delicious serving at a time,” said Brown.