Beyond Meat cuts its workforce and cuts 200 jobs
The company expects its annual revenue to fall by 18%, in part as consumers seek more cost-effective solutions in an inflationary context.
More traditional brands like Tyson Foods and Kellogg's are trying to compete with Beyond Meat in the plant-based meat market.
Beyond Meat lowered its revenue projections for the second time this year and announced the loss of 200 jobs, or 19% of its total workforce.
The company says it is facing a slowdown in demand for plant-based meat as consumers look for more economical solutions to deal with rising prices.
The company has also announced the departure of its Chief Financial Officer Philip Hardin by the end of October and appointed Chairman of the Board, Lubi Kutua, to replace him. Mr. Hardin had been in the position for just over a year.
Beyond Meat's stock fell 10% before markets opened, with the company citing increased competition as another factor in lowering its guidance.
More established brands like Tyson Foods and Kellogg's, as well as new entrants, have entered the plant-based meat niche, competing for market share at deep discounts.< /p>
Packaged food manufacturers everywhere are struggling with rising labor, ingredient and transportation costs.
Wall Street However, he has doubts about Beyond Meat's ability to raise prices to offset these increases, as other packaged food producers are doing. They believe that such a strategy is counterproductive for a company that is always looking to establish a lasting foothold with consumers.
The company, which had already slashed its full-year guidance in August, now expects annual revenue to hover between $400 million and $425 million, when it previously forecast rake in between $470 million and $520 million.
We are significantly reducing expenses and focusing on a set of key growth priorities, said Ethan Brown, CEO of Beyond Meat.
The job cuts will cause the company to incur a one-time charge of $4 million in the fourth quarter.
The layoffs, which are expected to generate savings of approximately $39 million over the next 12 months, will, among other changes, eliminate the position of president of the company's North America division .
Beyond Meat, which had approximately 1,100 employees at the end of the year latest, expects the downsizing to be completed by the end of the year.
With information from Reuters