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Economic Times
4 days ago
- Business
- Economic Times
Plant-based pioneer Beyond Meat struggles with cash crunch, considers bankruptcy
Synopsis Beyond Meat, a plant-based meat company, may face bankruptcy. Sales are declining, and debt is rising. Competition in the plant-based market is increasing. The company is trying to cut costs and restructure. The US market for plant-based meat is growing slowly. Beyond Meat is expanding its product line. The company hopes to overcome these challenges. Reuters FILE PHOTO: Vegetarian sausages from Beyond Meat Inc, the vegan burger maker, are shown for sale at a market in Encinitas, California, U.S., June 5, 2019. REUTERS//File Photo Plant-based meat pioneer Beyond Meat is facing a potential Chapter 11 bankruptcy after reporting falling sales, dwindling cash reserves, and mounting debt, according to which confirmed it on August 12. Once credited with creating the market for meat-like plant-based products, the company now struggles amid increased competition and a slow-growing niche in the second quarter of 2025 dropped nearly 20 per cent year-over-year, highlighting weakness in US retail channels and select international markets. Analysts say the proliferation of competitors offering similar plant-based products has eroded Beyond Meat's early advantage, leaving the company Meat currently holds $117.3 million in cash but $1.2 billion in debt. According to InvestingPro data, the company's overall financial health score is rated as WEAK, with a concerning debt-to-capital ratio of 86 per cent. To address these challenges, the company has appointed restructuring expert John Boken as interim Chief Transformation Officer and cut 44 North American jobs, representing 6 per cent of its workforce. Management is also pursuing cost reductions and operational efficiencies to stabilize the business. According to the Street, the US plant-based meat market has grown slowly, from roughly $939 million in 2019 to an estimated $3.4 billion in 2024, with projections reaching $6.1 billion by 2030. Beyond Meat has attempted limited product expansion beyond beef, pork, and poultry alternatives, but early consumer tests indicate these efforts appeal only to a narrow Meat, Inc. is an American company that produces plant-based meat substitutes designed to mimic the taste and texture of traditional animal-based meat. Founded in 2009, the company aimed to provide sustainable alternatives to beef, pork, and poultry using ingredients such as peas, beans, lentils, faba beans, and brown Meat products are marketed as non-GMO and free from animal products, appealing to vegetarians, vegans, and flexitarians. Its product line includes Beyond Burger, Beyond Sausage, Beyond Beef, and other plant-based protein items available in grocery stores and restaurants globally. The company became a public entity in 2019, attracting attention for its innovative approach to sustainable food. Despite early success, Beyond Meat faces challenges from rising competition, slow market growth, and operational costs, which have recently put the company at financial risk.
Miami Herald
10-08-2025
- Business
- Miami Herald
Beyond Meat is headed to Chapter 11 bankruptcy
The end was always inevitable for Beyond Meat, because being an innovator does not mean having a moat to protect your business. The pioneering company arguably created the category of plant-based meat that acts like actual meat. That's clever, but it's not a defensible business. Once Beyond Meat BYND created the category, it was inevitable that the product would become commoditized. Related: McDonald's CEO raises alarm bells about customer losses Beyond Meat owns no real intellectual property (IP) and every company in the meat and grocery business (more or less) now sells a take-off of a product that already had limited appeal. The people who like plant-based meat really like it, but that's a niche audience that won't grow all that much. That has created the frozen yogurt store effect for Beyond Meat. When one self-serve frozen yogurt chain opens in your town, it has lines out the door. The addition of a second store puts both in peril, and further openings split the market so much that nobody succeeds. That has happened with Beyond Meat and no amount of clever talk from founder and CEO Ethan Brown can change that. Beyond Meat has admitted its in trouble by hiring corporate restructuring expert John Boken from consultancy AlixPartners as interim chief transformation officer, It has also let go of 44 employees in North America (6% of its global workforce) as it seeks to cut operating expenses amid disappointing sales. Sales in the second quarter dropped by nearly 20% year-over-year. Brown opened the Q2 earnings call by stating the obvious. "We are disappointed with our second quarter results, which reflect ongoing softness in the plant-based meat category, particularly in the U.S. retail channel and certain international foodservice segments," he shared. More Restaurants After closing restaurants, Papa John's puts focus on pizzaBeloved sandwich chain franchisee closes in Chapter 11 bankruptcyTop-10 burgers list deals blow to McDonald's, Burger King The founder, however, was very blunt in his assessment. Before diving into details on the quarter, this level of disruption to a recovery requires broader commentary," he shared. "...To stabilize our business and with a goal to achieve EBITDA positive operations within the second half of 2026 and to realize our much longer-term objective of reshaping global protein markets in support of a healthier and more sustainable future, we are taking significant and immediate actions." Those actions include: Welcoming Boken as interim Chief Transformation Officer to lead and support our enterprise-wide transformation activities with a focus on operating expense reduction, gross margin expansion and broader operational expense reduction globally to fit our operating base into the existing near-term opportunity. These measures include a reduction in force that we performed each of our gross margin expansion activities, additional investments in our facilities around core production lines and select others where we see opportunities to significantly reduce pursuing expanded distribution of our core products and expect to bring on new U.S. retail distribution, including in the balance of this year. You can only remove so much water from a sinking ship. At some point, the amount becomes too much and everyone drowns. Beyond may serve as the gateway to the plant-based meat market, but that market has been growing slowly while more competitors enter the space. Plant-based meat sales by year: 2019: Sales of plant-based meat reached approximately $939 million in the U.S.2023: Sales reach between $2 billion and $2.25 billio, according to varying reports. 2024: Estimated at $3.4 billion according to IMARC Group. 2030 (projected) Grand View Research projects $6.14 billion in sales. To survive, Beyond Meat has to expand well beyond its core franchise, a real challenge for a company which has built all its equity around being a meat-like plant-based meat. Even Brown admits that brand expansion, a stated goal, will be an uphill battle. "Our limited test offering of Beyond Ground on our social channels last week represents an early foray beyond beef, pork and poultry replication and has been met with considerable enthusiasm, albeit with a very narrow consumer set," he said. Beyond Meat also has a significant cash problem. As of June 28, 2025, Beyond Meat's cash and cash equivalents balance was $117.3 million and total outstanding debt was $1.2 billion The company does have time to fend off a Chapter 11 bankruptcy filing, but it also has limited, if any, prospects to meet its impending cash needs. "Although we continue to have no near-term debt maturities in line with our strategic priorities for the year, we continue to focus on strengthening our balance sheet, including evaluating potential transactions to address our existing convertible notes prior to maturity in 2027," CFO Lubi Kutua said. Beyond Meat is a bankruptcy risk: Limited cash, heavy debtSlow growth, niche marketLimited expansion optionsIncreased competition forcing prices lower. Related: McDonald's CEO promises massive restaurant changes, improvements The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
07-08-2025
- Business
- Yahoo
Beyond Meat hires external adviser in turnaround effort but job cuts ensue
Beyond Meat has brought in an external adviser in an effort to turn around the loss-making alt-meat business as it reported another decline in sales, plus job cuts. Following a recent report that the California-based alternative-protein supplier plans to drop meat from its corporate name in a move away from mimicking animal-derived proteins, the company announced the appointment of a chief transformation officer on an interim basis. John Boken at consultancy AlixPartners was assigned to the job yesterday (6 August), an executive with 'corporate turnaround and restructuring experience', Beyond Meat said in its second-quarter results filing. Those results showed revenue deteriorated further in the three months to 28 June across Beyond Meat's sales channels, with the exception of foodservice in the US. Sales were down in both US and international retail, and the out-of-home segment in the latter. Group sales revenue for the quarter for all divisions slid 19.6% to just shy of $75m, while volumes dropped 18.9%, led by US retail and international foodservice. Net revenues are also expected to decline in the third quarter, with Beyond Meat estimating an end value of $68-73m. Otherwise, founder, president and CEO Ethan Brown reiterated previous comments that he would not be providing guidance as 48 job cuts were announced in the US, 6% of the company's total workforce. 'The company continues to experience an elevated level of uncertainty within its operating environment, which has, and management believes could continue to have, unforeseen impacts on the company's actual realised results,' Beyond Meat explained for the absence of an outlook. Beyond Meat has not reported a net profit since the business went public in 2019. The loss for the second quarter of fiscal 2025 narrowed slightly to $33.2m from a $34.5m loss a year earlier. The year-to-date loss was reported at $86.1m, compared to a corresponding loss of $88.4m. There was a lack of positives elsewhere. Gross profit for the quarter shrank to $8.6m from $13.7m, with $1.7m of expenses incurred from the previously reported exit from China. Operating losses widened to $38.8m from $33.9m. Adjusted EBITDA also remained in the red - $26m versus a $23m loss. And the associated margin blew out to a negative 34.7% from minus 24.7%. 'Q2 reinforces complexity of fundamentals,' John Baumgartner, a managing director at Mizuho Securities, headed up a follow-up research note. 'Combined with economic headwinds and stronger demand for animal meat, we are increasingly cautious about category growth prospects into 2026,' he said. 'We view the appointment of an interim chief transformation officer via AlixPartners as a positive, but Beyond Meat remains engaged in a formidable bind between needing to drive revenue growth while expenses are reduced.' US revenue amounted to $43.9m in the second quarter, down 20.4%. Retail dropped 26.7% to $32.9m, while out-of-home rose 6.8% to $11.1m. For international, sales revenue decreased 18.4% to $30.9m. Retail fell 9.8% to $15.9m and foodservice retreated 25.8% to $15.1m. Brown said: 'We are disappointed with our second-quarter results, which primarily reflect ongoing softness in the plant-based meat category, particularly in the US retail channel and certain international foodservice markets.' He added that Boken has been assigned to 'more rapidly and aggressively reducing our operating expenses to fit anticipated near-term revenues; prioritising increased distribution of our core product lines; and investing in margin expansion initiatives across these core products'. Mizuho's Baumgartner suggested 'it's (still) tough out there' for Beyond Meat, with the 'category lacking appeal and retailers making adjustments'. Referring to Boken's appointment and job cuts, he added: 'We view the moves positively for the benefits to profit and cash burn, but it also serves as a reminder of the complexity of the situation; Beyond Meat needs revenue growth while resources are being whittled.' "Beyond Meat hires external adviser in turnaround effort but job cuts ensue" was originally created and published by Just Food, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
