Beyond Meat CEO Ethan Brown is taking a more muted near-term outlook on his business amid rising competition in plant-based meats and an inflation-zapped consumer trading down to cheaper proteins.
"A shakeout does appear to be underway, and we expect more brands to either retreat or consolidate," Brown told analysts on an earnings call late Wednesday. "A less cluttered playing field to [then] emerge in the mid-term."
Here is how Beyond Meat performed compared to Wall Street estimates:
Net Sales: $82.5 million vs. $82.2 million
Adjusted Diluted Loss per Share: $1.60 vs. $1.16
And here are a few key highlights from the financial statements:
U.S. sales -7.9% year over year.
Adjusted operating loss of $73.8 million vs. a loss of $36.8 million last year.
Cash $390 million vs. $733 million as of Dec. 31, 2021.
Beyond Meat stock rose 1% in pre-market trading on Thursday. The company's ticker page was among the most visited on Yahoo Finance through mid-morning.
Wall Street is staying mostly bearish on Beyond Meat given the increasingly volatile industry backdrop.
"We emerged from El Segundo, CA, based Beyond Meat’s 3Q22 earnings call with more questions than answers," JP Morgan analyst Ken Goldman wrote in a note to clients. "Although we respect the company’s newfound dedication to cash flow, we don’t see the path to FCF [free cash flow] positivity as clearly as management does, especially since it relies on the restoration of top line growth."
Goldman, who reiterated an Underweigh rating on Beyond Meat shares, added that "cash is down to $390MM (it was $1.1B a year ago) and likely will keep falling over the next three quarters. Management says it will be FCF positive a year or so from now, but we find it difficult to give them the benefit of the doubt, not until we see evidence that its forecasting has become more reliable."