The plant-based meat industry is in a bad place. Sales in the US fell last year as the pandemic-era enthusiasm for vegan burgers and sausages continued to wane. Beyond Meat, once the darling of the plant-based boom and the first one of its cohort to go public, in 2019, has become a cautionary tale about the tough road ahead for similar companies.
Beyond Meat announced mixed results for the second quarter of 2024. Revenue was down 8.8 percent, and sales volumes declined by 14 percent compared to the second quarter of 2023, but the margin the company made on each of its products was up.
“We are encouraged by many of the results we see this quarter, results that demonstrate clear progress against our 2024 plan and our longer-term goal of profitable operations,” Beyond Meat CEO Ethan Brown told investors in an earnings call Wednesday.
In 2023, Beyond’s revenue declined by 18 percent, to $343.4 million—which was above the low market expectations—but it also reported $82.7 million in losses. In the US, sales declined by 32.3 percent. So far, the company hasn’t rebounded, announcing a weak first quarter with revenue down by 18 percent again, to $75.6 million, as it continued to be hit by underwhelming demand from the US.
Europe has been one of the brighter spots for Beyond over the past couple of years. In 2023, the company’s international sales grew while sales in the US sharply declined. In the UK, McDonald’s has sold McPlant burgers with Beyond Meat patties since fall 2021, while a similar partnership in the US didn’t get beyond the trial stage.
Although Beyond reported declining sales internationally as well, on the most recent earnings call, chief financial officer Lubi Kutua said that the company was focused on widening its distribution in Europe. “We’re starting from a very small base in the EU,” Kutua said. “We just don’t have that large of a presence out in Europe at the moment.”
Faced with difficult decisions in its path toward profitability, one investor predicted during an earnings call in February that the “center of gravity” of Beyond’s business was likely to shift to international markets. Brown did not directly address that point in the February call but conceded that, in his opinion, the conversation in the US around plant-based meats had been “politicized” and “clouded with this misinformation.” Plant-based meat has been pitted against animal meat in the US’s culture war.
The entire plant-based industry has been affected by a fickle customer base. Rival Impossible Foods, which is targeting a “liquidity event” to raise capital in a move that could see it IPO or consider a sale to another company, has decided to rebrand itself to increase its appeal to meat eaters. Meanwhile, other vegan brands like Nowadays, Meatless Farm, and VBites have gone bust.
Plant-based meats shouldn’t be counted out altogether, says Chris DuBois, an executive vice president at the analyst firm Circana. “It’s still a billion-dollar category, and that’s a big deal.”