Beyond Meat said grocery sales volume in the US during Q4 lost 19.5% to $49.98 million. The company tied the sales slump to low demand, high discounts, market share loss, and five fewer shipping days than the previous year.
Shares of Los Angeles-based producer of plant-based meat substitutes Beyond Meat (NASDAQ: BYND) declined on the 24th of February after the company reported losses for its Q4.
The company announced that losses for the quarter were wider-than-expected, and quarterly revenue also shrank. This came as the plant-based meat substitutes manufacturer transitioned from sinking grocery sales to large-scale production for fast-food. In reaction to the Q4 announcement, Beyond Meat shed 11% in after-hours trading.
BYND has been recording steady declines over the past year, including a 24.80% dip in its year-to-date record.
While January was about the unveiling of KFC Beyond Fried Chicken, February came with McDonald’s McPlant burger, made with Beyond’s beef patty substitute. In addition to the new business, the company also intends to cut back on expenses. Despite these, BYND dropped in extended trading as the company predicted a disappointing revenue for 2022.
Beyond Meat said Q4 net loss was $80.37 million or $1.27 per share. This is a huge loss compared to the net loss of the previous year, which was $25.08 million, or 40 cents per share. The net loss for the quarter also exceeded analysts’ expectations of 7 cents per share. Additionally, revenue dropped 1% from $101.9 million a year ago to $100.7 million. Meanwhile, analysts had predicted a loss of 70 cents a share on revenue of $1010 million.
Beyond Meat Record Losses in 2021 Q4 amid Softer Demand
Furthermore, Beyond Meat said grocery sales volume in the US during Q4 lost 19.5% to $49.98 million. The company tied the sales slump to low demand, high discounts, market share loss, and five fewer shipping days than the previous year. The last quarter’s result marks the second consecutive quarter that Beyond Meat would disappoint investors. In Q3, the company attributed its losses to the delta variant of the coronavirus and distribution challenges. The manufacturer also said that an expense of $1.9 million due to water damage at one of its plants also caused the Q3 losses.
According to Beyond Meat executives, the company’s decision to depend on more costly co-manufacturing facilities resulted in higher costs. Also, the shift led to spending more on transportation and logistics. However, CEO Ethan Brown said the company hopes to “substantially moderate” its operating expenses this year. As such, moderation could aid its return to profits. Speaking further on its operating costs, Brown said:
“The investments we made in our team, infrastructure, and capabilities across the U.S., E.U., and China, as well as extensive product scaling activities for key strategic partners, weighed heavily on operating expenses and gross margin during a fourth quarter and year that were already impacted by lower than expected volumes.”
Beyond Meat’s revenue outlook for 2022 slightly falls below Wall Street’s expectations. Beyond is forecasting revenue of $560 million to $620 million. Despite the forecast being up 21% to 33% compared to the previous year’s forecast, the outlook is below Wall Street’s net sales prediction of $637.3 million.