The plant-based meat industry is in a bad place. U.S. sales fell last year as enthusiasm for pandemic-era vegan burgers and sausages continued to wane. Beyond Meat, once the darling of the plant-based boom and the first of its cohort to go public in 2019, has become a cautionary tale about the rocky road ahead for similar companies.
Beyond Meat reported mixed results for the second quarter of 2024. Revenue fell 8.8 percent and sales volume declined 14 percent compared to the second quarter of 2023, but the margin the company made on each of its products increased.
“We are encouraged by many of the results we see this quarter, results that demonstrate clear progress against our 2024 plan and our long-term goal of profitable operations,” Beyond Meat CEO Ethan Brown told investors on an earnings call Wednesday.
In 2023, Beyond’s revenue fell 18 percent to $343.4 million, above low market expectations, but the company also reported losses of $82.7 million. In the U.S., revenue fell 32.3 percent. So far, the company has not recovered, announcing a weak first quarter with revenue down another 18 percent to $75.6 million as it continues to be hit by disappointing U.S. demand.
Europe has been one of the bright spots for Beyond in recent years. The company’s international sales grew in 2023, while sales in the U.S. fell sharply. In the U.K., McDonald’s has been selling McPlant burgers made with Beyond Meat patties since fall 2021, while a similar partnership in the U.S. failed to progress beyond a pilot phase.
While Beyond also reported declining sales internationally, Chief Financial Officer Lubi Kutua said during the company’s most recent earnings call that the company is focused on broadening distribution in Europe. “We’re starting with a very small base in the EU,” Kutua said. “We just don’t have that big of a presence in Europe right now.”
Faced with tough decisions on the road to profitability, one investor predicted during a February earnings call that Beyond’s business would likely shift its “center of gravity” to international markets. Brown didn’t directly address that point in the February call, but admitted that, in his view, the conversation in the U.S. about plant-based meat had become “politicized” and “clouded by this misinformation.” Plant-based meat has been pitted against animal meat in America’s culture war.
The entire plant-based industry has been hit by a volatile customer base. Rival Impossible Foods, which is targeting a “liquidity event” to raise capital in a move that could lead to an IPO or a sale to another company, has decided to rebrand itself to broaden its appeal to meat eaters. Meanwhile, other vegan brands including Meanwhile, Meatless Farm and VBites have gone bankrupt.
Plant-based meat shouldn’t be written off entirely, says Chris DuBois, executive vice president at analyst firm Circana. “It’s still a billion-dollar category, and that’s a big deal.”
