Beyond Meat stock tumbles 14% after lowering third-quarter revenue outlook
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Beyond Meat “Beyond Burger”, patties made with plant-based replacements for meat are on display in New York City, November 15, 2019,
Angela Weiss | AFP | Getty Images
The shares of Beyond MeatThe stock plummeted more than 14% on Friday premarket trades after the company stated that it anticipates reporting lower revenue in the third quarter than originally forecast.
Beyond stated that it anticipates net sales to be $106 million. This is lower than its previous outlook of $120million to $140million. Refinitiv surveyed Wall Street analysts and they expected revenue to be $133.1 Million for the third quarter. Although the company didn’t release a outlook on its quarterly earnings, analysts expected a loss in revenue of 29 cents per share before Friday’s announcement.
According to the company, multiple factors contributed to the slowdown in sales including the Covid-19 Delta variant. Beyond claimed that Canadian distributors had reduced retail orders longer than they expected. They also anticipated incremental orders which didn’t materialize due to one large customer switching distributors. The company stated that labor shortages may have delayed shelf resets and distribution expansion.
The company’s performance was also affected by its operational problems. Beyond stated that a Pennsylvania plant lost its potable water for 2 weeks, while another sustained water damage from severe weather.
Beyond had one positive spot during the quarter. An international customer placed accelerated orders. The customer’s identity was withheld by the company.
Beyond’s first forecast for third quarter revenue disappointed investorsThe company published it in August. Demand has dropped after last year’s record-breaking grocery sales during lockdowns. Despite restaurants operating at maximum capacity, demand for food services hasn’t recovered completely. According to executives, last quarter saw a decline in food service orders. many eateries were being more conservative with their ordersBecause they weren’t sure of the effect of the Delta variant on businesses.
Beyond will report full results for the third quarter after the bell Nov. 10
This stock fell 13% in the past year giving it an estimated market value of $6.87billion.
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