Beyond Meat's CEO Says It's 75% of the Way Towards Matching Animal Meat
It could be a while before Beyond Meat lives up to its name. The maker of plant-based burgers and sausages estimates it's three-quarters of the way towards matching the look, smell, taste and other attributes of animal meat.
The Beyond Burger 2.0, launched in June, represents its best effort so far. "I think it's quite a bit further in the direction of our true north, which is animal protein," CEO Ethan Brown said on the second-quarter earnings call this week. "I'd say it's maybe 75% of the way there."
The company's shares are set to tank on Tuesday after reporting earnings, spending more than expected.
Brown acknowledged his team "have miles to travel" and the final 25% "will be more difficult." However, their tools, expertise, and capabilities are giving them "a lot of enthusiasm for closing that final stretch."
Strong demand for Beyond Burger nearly quadrupled Beyond Meat's net revenue to about $67 million last quarter, swinging it to an operating profit of $2.2 million from a $7.3 million loss a year earlier. Yet the company has plans beyond perfecting its signature product. For example, it's rolling out other kinds of "meat" -- it partnered with Dunkin' to launch a Beyond Sausage breakfast sandwich in New York last week -- and exploring alternatives to pea protein.
"If you think about the way Mom shops or Dad shops on a weekend for the family, they're not buying a particular protein in six or seven different form factors," Brown said on the call. "They're buying beef. They're buying turkey, chicken, et cetera. So for us to credibly take a very, very long run and broad run at the meat case, we'd offer the consumer that same diversity."
"I think if you look ahead 5 years from now, you'll see sausage from us that has different proteins," he added. "Maybe one sausage will be offered with lentil protein, the other with lupin or camelina. You can kind of name your source."
Brown also downplayed the threat of rival Impossible Foods venturing into grocery stores and supermarkets.
"It's a $1.4 trillion industry, getting more players in that are willing to market and tell the story is really important," he said. "We like competition. We particularly like it when we're winning. But I think, overall, competition keeps everybody sharp."