Beyond Meat plans cost cuts, price hikes in 2024

They’re selling like…faux-meat patties. And that could mean anything.

Beyond Meat, the company behind those amazing not-burgers you had at that backyard BBQ that one time, beat market expectations for revenue in its Q4 earnings report.

In recent years, demand for plant-based meats has slumped, making alternative meat companies like Beyond feel like other millennial-era, hyped-up, tech-ish companies with blockbuster IPOs and not much else to show for themselves. Beyond, for instance, is only worth around a third of its 2019 IPO value.

Amid rampant inflation, plant-based meats have struggled to reach parity with animal meat sales, and high prices have remained a challenge for budget-conscious consumers. Now, the plant-based meat maker is wagering its turnaround plan on cutting costs and raising prices.

“The shift to raising prices instead of cutting makes sense because Beyond probably needs to target a smaller set of consumers to succeed,” TD Cowen analysts shared in a note.

Beyond will implement “a steep reduction in…operating costs and cash use,” CEO Ethan Brown said in the company’s earnings call. The company also plans to modify its domestic trade and pricing programs, which will become “effective in early Q2,” Brown said. “Though varied across channels and product lines, we expect the overall impact of these pricing changes to meaningfully impact margin across the balance of the year.”

Brown noted that the “change in strategy does not reflect an abandonment of [Beyond’s] long-sought price parity goal, which we in fact achieved in certain very specific offerings.”

For now, the company looks like a burger without all the fixin’s: could be worse, but could be better. Net revenue for the quarter dropped 7.8% to $73.7 million, though analysts had only expected $66.7 million. The alternative meat maker’s full-year net revenue forecast fell to the $315 million to $345 million range, which was on the low end of the $344 million the market predicted.