US company Beyond Meat experienced a significant slump in demand for its plant-based meat substitutes in the first three months of this year, with sales decreasing by 18% to end the quarter on $75.6 million.
The company’s net loss rose to $54.4 million. This was less than the $59-million loss registered in the first three months of the previous year, but still higher than what analysts had anticipated.
Underlying this decline was a change in purchasing behaviour from customers such as McDonald’s and Yum Brands, the owner of fast-food chains KFC, Taco Bell and Pizza Hut. To maintain sales, Beyond Meat was compelled to offer larger discounts on its vegetarian alternatives to burgers and sausages.
Based in El Segundo, California, Beyond Meat is grappling with increased production costs, higher raw material expenses and diminishing demand. The company cites “the persistent weakness in demand in the plant-based meats category, inflation, high interest rates and concerns over the likelihood of a recession” as ongoing challenges.
The manufacturer of meat substitutes was forced to lower its revenue forecasts multiple times last year due to disappointing demand and also announced job cuts. For this year, Beyond Meat anticipates revenue ranging between $315 million and $345 million.
