In an October 22nd release, Beyond Meat Inc. announced a downward revision of third quarter revenue from a previous value of $130 million to $106 million. The Company attributes the projected decline to "ongoing macro and microeconomic factors" including the Delta strain COVID-19 variant, a drop in retail orders and cancellation of sales associated with a major distributor. The company also cites "operational challenges" including severe weather resulting in the loss of potable water in a Pennsylvania plant.
Earnings for the third quarter will be released on November 10th. For the second quarter of FY 2021, Beyond Meat posted a loss of $19.7 million on revenue of $149.4 million. For the comparative quarter of fiscal 2020 the company lost $10.2 million on revenue of $113.3 million.
Reviewing past results for Beyond Meat and other manufacturers of plant-based alternatives to real meat, it is noted that the trajectory in gross margins are now proportional to increases in sales. For the second quarter of fiscal 2021 gross margin was 29.7 percent increasing to 31.7 percent in the third quarter of FY 2021. For the two consecutive quarters, revenue increased by 31.9 percent.
The announcement of the decline in revenue resulted in a sharp drop in share price. On October 21st BYND closed at $108.51 but opened the following morning at $91.99. Over fifty-two weeks, BYND has traded in a range of $91.55 to $221.00 with a fifty-day moving average of $108.00. On a trailing twelve-month basis, operating margin was -15.8 percent and profit margin -20.1 percent. Over the same period the company generated returns of -4.5 percent on assets and -28.3 percent on equity.