Beyond Meat shares soared Tuesday as investors cheered better-than-expected fourth quarter revenue and a new, healthier burger that could help revive U.S. sales.
The plant-based meat maker's stock jumped more than 78% in after-market trading.
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The El Segundo, California-based company said its revenue for the October-December period fell 8% to $73.7 million. But that was better than the $66.7 million Wall Street was expecting, according to analysts polled by FactSet.
The company also forecast improving margins this year as a result of significant restructuring. The company trimmed staff and products last year — including its slow-selling plant-based jerky — and also narrowed its sprawling production. Beyond Meat President and CEO Ethan Brown said the company used to rely on 13 outside manufacturing locations in North America; now it uses just one.
“I think we really right-sized the business for the size of the current opportunity and the growth that we want to create ahead,” Brown said Tuesday during a conference call with investors.
Beyond Meat said its U.S. sales fell 23.5% during the quarter. Grocery sales were down despite lower prices, the company said, and restaurant demand also fell.
The company hopes to reverse its U.S. losses with a new version of its signature Beyond Burger that has less sodium and saturated fat and more protein. The new burger and Beyond Beef grounds start rolling out to U.S. stores next month.
Brown said the new option should help blunt criticisms that previous versions were unhealthy and overly processed. The new burger uses avocado oil instead of canola and coconut oils and contains added protein from lentils and fava beans.
“What we have to do is reengage the consumer into this entire category with products that are really delivering value to them in a way that they understand,” Brown said. “That's really about continuing to improve the taste, which I think we’ve done, but also addressing this fundamental issue around health.”
Beyond Meat said its international sales jumped 28.5% during the fourth quarter on both stronger grocery and restaurant sales. Sales in Europe were a particular bright spot, boosted by the sale of Beyond's McPlant burger at McDonald's. McDonald's doesn't sell Beyond products in the U.S.
It said its net loss more than doubled to $155.1 million for the fourth quarter, or $2.40 per share. Adjusted for one-time items, including restructuring costs, the company lost 92 cents per share, according to Zacks Investment Research. That was steeper than the 89-cent loss analysts forecast, according to FactSet.
The company expects full-year revenue in the range of $315 million to $345 million in 2024. Analysts are forecasting $344.4 million, according to FactSet. Its full-year revenue fell 18% to $343 million in 2023.
Gross margin is expected to be in the mid- to high-teens range for the full year 2024, the company said. Its gross margin was in the negatives in 2023.