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Shares of Beyond Meat (NASDAQ: BYND) continued to struggle in the third quarter, as the plant-based meat producer posted disappointing bottom-line results, though it did return to top-line growth.
As of 11:51 a.m. ET, the stock was down 10.6% on the news.
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Beyond Meat improves, but losses are still mounting
It was the first quarter of revenue growth for the plant-based meat company in three years, as the top line increased 7.6% to $81 million, which compared to estimates of $80.7 million. Revenue growth was solid in the U.S., up 14.9%, but a decline in international food service revenue weighed on overall results.
It also returned to a positive gross profit at $14.3 million, up from a gross loss of $7.3 million, as top-line numbers benefited from higher prices.
The company narrowed its losses further down the income statement with an operating loss of $30.9 million, compared to a loss of $69.6 million in the quarter a year ago. On the bottom line, it reported a loss of $0.41 per share, compared to a loss of $1.09 per share in the quarter a year ago. That was slightly better than expectations at a loss of $0.44.
CEO Ethan Brown said, "We are pleased in the third quarter we returned to growth, increasing net revenues on a year-over-year basis" and added, "Looking ahead, we expect to increase our cash reserves by year-end and pursue further balance sheet restructuring in 2025."
What's next for Beyond Meat?
What seemed to weigh on the stock was that it's lowered its full-year revenue guidance from $320 million-$340 million to $320 million-$330 million, and it sees gross margin in the mid-teens, in line with the third-quarter performance.
That compares to the consensus at $328.6 million. While the quarter shows the company making progress in its recovery, Beyond Meat is still a long way from profitability. Until it demonstrates it can get there, investors are likely to be skeptical.
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