Today, the shares of Beyond Meat encountered a downward trend.
Shares of Beyond Meat (BYND 6.53%) faced challenges in the third quarter, as the plant-based meat manufacturer delivered disappointing financial results in the profit section, yet managed to record a resurgence in revenue growth.
At 11:51 a.m. ET, the stock plummeted 10.6% due to this news.
Beyond Meat sees improvements, but losses persist
Marking the first revenue increase in three years, the company reported a 7.6% rise in revenue to $81 million, surpassing expectations of $80.7 million. The U.S. market saw notable growth, rising 14.9%, but a decline in international food service revenue affected overall performance.
The company also experienced a positive shift in gross profit, rising to $14.3 million from a gross loss of $7.3 million, resulting from improved top-line figures due to higher pricing.
The income statement saw a reduction in losses with an operating loss of $30.9 million, down from a loss of $69.6 million in the previous year's quarter. The bottom line posted a loss of $0.41 per share, compared to a loss of $1.09 per share in the prior year's quarter. This slightly surpassed expectations of a loss of $0.44 per share.
CEO Ethan Brown expressed satisfaction, stating, "We're pleased to have returned to growth, increasing net revenues year-over-year in the third quarter" and mentioned, "We anticipate boosting our cash reserves by year-end and pursuing further balance sheet restructuring in 2025."
Future outlook for Beyond Meat
The stock's decrease appeared to be due to the company cutting its full-year revenue forecast from $320 million-$340 million down to $320 million-$330 million, and anticipating a mid-teens gross margin, following the third-quarter's performance.
This is less than the consensus estimate of $328.6 million. While the quarter indicates progress in the company's recovery, Beyond Meat remains a considerable distance from achieving profitability. As long as it fails to demonstrate its ability to reach this milestone, investors are likely to remain skeptical.
In light of the company's financial report, investors may need to consider their strategy for financing or reinvesting in Beyond Meat, considering the persisting losses and the challenge to achieve profitability. The company's reduced full-year revenue forecast and anticipation of mid-teens gross margin highlight the need for careful consideration when investing in the stock market, focusing on potential areas of growth.
