Beyond Meat’s Q4 2023 Earnings Exceed Analyst Estimates, Prompting Stock Surge – vegconomist
Plant-based meat industry leader Beyond Meat has disclosed its financial results for the fourth quarter and full year ending December 31, 2023, triggering a surge in its stock value.
Beyond Meat’s Q4 2023 net revenues were reported at $73.7 million, reflecting a 7.8% decrease compared to the previous year. Despite this decline, the figures exceeded the average analyst estimate of $66.8 million, as compiled by Bloomberg, propelling the company’s stock to a notable upswing.
“Our 2024 plan includes taking steps to steeply reduce operating expense and cash use”
The gross profit for Q4 2023 saw a loss of $83.9 million, mainly due to non-cash charges related to a Global Operations Review report in November, and changes in accounting estimates. The net loss for Q4 2023 amounted to $155.1 million, compared to $66.9 million in the corresponding period last year. That said, sales in both domestic and international channels still surpassed expectations.
Changes for profitable growth
Throughout 2023, the company focused on making changes for sustainable and profitable growth, with initiatives including reducing expenses, adjusting pricing, and optimizing production. To enhance profitability amidst challenging global economic conditions, Beyond Meat implemented discounts on its products in both the US and international markets. However, president and CEO of Beyond Meat, Ethan Brown, noted in the Q4 earnings call that “I think there’s so much noise in the category [and] agitation outside the category with people saying negative things about [it], scaring consumers away that pricing just wasn’t as effective a tool.”
Brown also acknowledged the challenges faced in 2023 and outlined measures taken to reset the business for sustainable and profitable growth. Brown stated in a press release, “Our 2024 plan includes taking steps to steeply reduce operating expense and cash use; pricing actions and the right-sizing of our production footprint.”
As part of the strategic steps, Beyond Meat introduced a revamped recipe last week, Beyond IV, for its Beyond Burger and Beyond Beef, featuring 60% less fat, 20% less sodium, and increased protein content to 21g per serving. The company has also announced the discontinuation of its Beyond Meat Jerky line to focus operations on Beyond IV and improve efficiency.
Strengthening near-term operations
Beyond Meat’s cost-cutting initiatives over the past year, including a 19% reduction in the non-production workforce, contributed to substantial operational spending reductions. The company reported operational spending of $107.8 million for 2023, down significantly from $320.2 million the previous year. Brown expressed confidence that these strategic changes, coupled with further measures planned for the year, will fortify near-term operations for the company.
“We believe these sweeping changes, together with measures we plan to pursue this year to bolster our balance sheet, will strengthen our near-term operations as we pursue our vision of being the global protein company of the future,” concluded Brown.
