BEYOND MEAT INC

Previous wording

The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A, “Risk Factors,” of our 2023 10-K and Part II, Item 1A, “Risk Factors” and “Note Regarding Forward-Looking Statements” included elsewhere in this report and those discussed in other documents we file from time to time with the SEC. The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes and other financial information included in this quarterly report and our audited consolidated financial statements and related notes included in our 2023 10-K. Our historical results are not necessarily indicative of the results to be expected for any future periods and our operating results for the three and six months ended June 29, 2024 are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2024 or for any other interim period or for any other future year or period.

Current wording

The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A, “Risk Factors,” of our 2023 10-K and Part II, Item 1A, “Risk Factors” and “Note Regarding Forward-Looking Statements” included elsewhere in this report and those discussed in other documents we file from time to time with the SEC. The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes and other financial information included in this quarterly report and our audited consolidated financial statements and related notes included in our 2023 10-K. Our historical results are not necessarily indicative of the results to be expected for any future periods and our operating results for the three and nine months ended September 28, 2024 are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2024 or for any other interim period or for any other future year or period.

Previous wording

We sell a range of plant-based meat products across our three core platforms of beef, pork and poultry. As of June 2024, Beyond Meat branded products were available at approximately 130,000 retail and foodservice outlets in more than 60 countries worldwide, across mainstream grocery, mass merchandiser, club store and natural retailer channels, and various food-away-from-home channels, including restaurants, foodservice outlets and schools. The number of retail and foodservice outlets where Beyond Meat branded products are available was derived from rolling 52-week data as of June 2024 and excludes retail outlets unique to Beyond Meat Jerky. In 2023, as part of our Global Operations Review, we made the decision to discontinue the Beyond Meat Jerky product line.

Current wording

We sell a range of plant-based meat products across our three core platforms of beef, pork and poultry. As of September 2024, Beyond Meat branded products were available at approximately 129,000 retail and foodservice outlets in more than 60 countries worldwide, across mainstream grocery, mass merchandiser, club store and natural retailer channels, and various food-away-from-home channels, including restaurants, foodservice outlets and schools. The number of retail and foodservice outlets where Beyond Meat branded products are available was derived from rolling 52-week data as of September 2024 and excludes retail outlets unique to Beyond Meat Jerky. In 2023, as part of our Global Operations Review, we made the decision to discontinue the Beyond Meat Jerky product line.

Previous wording

In response to the current difficult environment and the negative impact of certain factors on our business and the overall plant-based meat category, beginning in 2022 we pivoted our focus toward sustainable long-term growth supported by three pillars: (1) driving margin recovery and operating expense reduction through the implementation of lean value streams across our beef, pork and poultry platforms; (2) inventory reduction and cash flow generation through more efficient inventory management; and (3) focusing on near-term retail and foodservice growth drivers while supporting strategic key long-term partners and opportunities.

Current wording

In response to the current difficult environment and the negative impact of certain factors on our business and the overall plant-based meat category, beginning in 2022 we pivoted our focus toward sustainable long-term growth supported by three pillars: (1) driving margin recovery and operating expense reduction through the implementation of lean value streams across our beef, pork and poultry platforms; (2) inventory reduction and cash flow generation through more efficient inventory management; and (3) focusing on near-term retail and foodservice growth drivers while supporting key strategic long-term partners and opportunities.

Previous wording

To further reduce operating expenses, in November 2023, we initiated our Global Operations Review, which involves narrowing our commercial focus to certain growth opportunities, and accelerating activities that prioritize gross margin expansion and cash generation. These efforts have to date included, and may in the future include, the exit or discontinuation of select product lines such as Beyond Meat Jerky; changes to our pricing architecture within certain channels including the recent price increases of certain of our products in our U.S. retail and foodservice channels; accelerated, cash-accretive inventory reduction initiatives; further optimization of our manufacturing capacity and real estate footprint; and the review of our operations in China. As a result of this review, on November 1, 2023, our board of directors approved a plan to reduce our workforce by approximately 65 employees, representing approximately 19% of our global non-production workforce (or approximately 8% of our total global workforce). We may not be able to fully realize the cost savings and benefits initially anticipated from our cost reduction initiatives and Global Operations Review, and the realized costs may be greater than expected.

Current wording

To further reduce operating expenses, in November 2023, we initiated our Global Operations Review, which involves narrowing our commercial focus to certain anticipated growth opportunities, and accelerating activities that prioritize gross margin expansion and cash generation. These efforts have to date included, and may in the future include, the exit or discontinuation of select product lines such as Beyond Meat Jerky; changes to our pricing architecture within certain channels including price increases of certain of our products in our U.S. retail and foodservice channels; accelerated, cash-accretive inventory reduction initiatives; further optimization of our manufacturing capacity and real estate footprint; reductions in our workforce; and the continued review of our operations in China, which may include scaling back or discontinuing some or all of our operations in China. As a result of this review, on November 1, 2023, our board of directors approved a plan to reduce our workforce by approximately 65 employees, representing approximately 19% of our global non-production workforce (or approximately 8% of our total global workforce). We may not be able to fully realize the cost savings and benefits initially anticipated from our cost reduction initiatives and Global Operations Review, and the realized costs may be greater than expected.

Previous wording

•unfavorable changes in our product sales mix, including the launch of new products, which may carry lower margin profiles relative to existing products, increased sales generally carrying a lower selling price per pound as a percentage of our total sales to strategic QSR customers, and changing demand for our core products;

Current wording

•unfavorable changes in our product sales mix, including the launch of new products, which may carry lower margin profiles relative to existing products, increased sales generally carrying a lower selling price per pound as a percentage of our total sales to strategic QSR customers, and lower demand for our core products;

Previous wording

•negative impacts on capacity utilization as a result of lower than anticipated revenues, which have in the past and could in the future give rise to increased costs per unit, underutilization fees, termination fees and other costs to exit certain supply chain arrangements and product lines, and/or the write-down or write-off of certain equipment and other fixed assets, driving less leverage on fixed costs and delaying the speed at which cost savings initiatives positively impact our financial results;

Current wording

•negative impacts on capacity utilization as a result of lower than anticipated revenues, which have in the past and could in the future give rise to increased costs per unit, underutilization fees, termination fees and other costs to exit certain supply chain arrangements and product lines, and/or the write-down or write-off of certain equipment and other fixed assets and impairment charges, driving less leverage on fixed costs and delaying the speed at which cost savings initiatives positively impact our financial results;

Previous wording

•changes in our pricing strategy, including actions intended to improve our price competitiveness relative to competing products or to improve profitability, such as the recent price increases of certain of our products in our U.S. retail and foodservice channels;

Current wording

•changes in our pricing strategy, including actions intended to improve our price competitiveness relative to competing products or to improve profitability, such as price increases of certain of our products in our U.S. retail and foodservice channels;

Previous wording

We generate net revenues primarily from sales of our products to our customers across mainstream grocery, mass merchandiser, club store and natural retailer channels, and various food-away-from-home channels, including restaurants, foodservice outlets and schools, mainly in the United States, the EU and Canada. Following our Global Operations Review, in recent periods, as part of our effort to reduce excess or obsolete inventory and generate incremental cash, we have also generated net revenues from sales of ingredients.

Current wording

We generate net revenues primarily from sales of our products to our customers across mainstream grocery, mass merchandiser, club store and natural retailer channels, and various food-away-from-home channels, including restaurants, foodservice outlets and schools, mainly in the United States, the EU and Canada. Following our Global Operations Review, in recent periods, as part of our effort to reduce excess or obsolete inventory and generate incremental cash, we have also generated net revenues from ingredient sales.

Previous wording

(1)Net revenues associated with Beyond Meat Jerky sold to the Planet Partnership, LLC (“TPP”) in the three months ended June 29, 2024 and July 1, 2023 were $0. Net revenues associated with Beyond Meat Jerky sold to TPP in the six months ended June 29, 2024 and July 1, 2023 were $0 and $5.3 million, respectively. In 2023, as part of our Global Operations Review, we made the decision to discontinue the Beyond Meat Jerky product line.

Current wording

(1)Net revenues associated with Beyond Meat Jerky sold to the Planet Partnership, LLC (“TPP”) in the three months ended September 28, 2024 and September 30, 2023 were $0. Net revenues associated with Beyond Meat Jerky sold to TPP in the nine months ended September 28, 2024 and September 30, 2023 were $0 and $5.3 million, respectively. In 2023, as part of our Global Operations Review, we made the decision to discontinue the Beyond Meat Jerky product line.

Previous wording

The following factors and trends in our business have driven net revenue generation in prior periods and are expected to be key drivers of net revenue generation over time, subject to the challenges discussed above:

Current wording

The following factors and trends in our business have driven net revenue generation in prior periods and are expected to be key drivers of net revenue generation over time, subject to the challenges discussed herein:

Previous wording

We routinely offer sales discounts and promotions through various programs to customers and consumers. These programs include rebates, temporary on-shelf price reductions, off-invoice discounts, retailer advertisements, product coupons and other trade activities. The expense associated with these discounts and promotions is estimated and recorded as a reduction in total gross revenues in order to arrive at reported net revenues. At the end of each accounting period, we recognize a contra asset to “Accounts receivable” for estimated sales discounts that have been incurred but not paid which totaled $6.3 million and $6.9 million as of June 29, 2024 and December 31, 2023, respectively. We continue to face increasing competition across all channels, and we expect that trend to continue, especially if consumers continue to trade down among proteins in the context of significant inflationary pressure. Moving forward we expect to continue to invest in promotional discounting to address the current consumer trend with more targeted key selling period activations that we expect will allow us to scale back overall trade spending and continue to build brand awareness and increase consumer trials of our products.

Current wording

We routinely offer sales discounts and promotions through various programs to customers and consumers. These programs include rebates, temporary on-shelf price reductions, off-invoice discounts, retailer advertisements, product coupons and other trade activities. The expense associated with these discounts and promotions is estimated and recorded as a reduction in total gross revenues in order to arrive at reported net revenues. At the end of each accounting period, we recognize a contra asset to “Accounts receivable” for estimated sales discounts that have been incurred but not paid which totaled $5.2 million and $6.9 million as of September 28, 2024 and December 31, 2023, respectively. We continue to face increasing competition across all channels, and we expect that trend to continue, especially if consumers continue to trade down among proteins in the context of significant inflationary pressure. Moving forward we expect to continue to invest in promotional discounting to address the current consumer trend with more targeted key selling period activations that we expect will allow us to scale back overall trade spending and continue to build brand awareness and increase consumer trials of our products.

Previous wording

Generally, we expect to experience greater demand for certain of our products during the U.S. summer grilling season. In 2024, 2023 and 2022, U.S. retail channel net revenues during the second quarter were 21%, 10% and 16% higher than the first quarter, respectively. While we expected to continue to see additional seasonality effects in 2023, as compared to 2022, we saw more muted effects from seasonality in the third and fourth quarters of 2023 as compared to the prior-year periods and the second quarter of 2023, primarily reflecting weak category demand and pricing actions. In general, any historical effects of seasonality have been more pronounced within our U.S. retail channel, with revenue contribution from this channel generally tending to be greater in the second and third quarters of the year, driven by increased levels of grilling activity, higher levels of purchasing by customers ahead of holidays, the impact of customer shelf reset activity and the timing of product restocking by our retail customers. In an environment of heightened uncertainty from recessionary and inflationary pressures, prolonged weakness in the plant-based meat category, competition and other factors impacting our business, we are unable to assess the ultimate impact on the demand for our products as a result of seasonality.

Current wording

Generally, we expect to experience greater demand for certain of our products during the U.S. summer grilling season. In 2024, 2023 and 2022, U.S. retail channel net revenues during the second quarter were 21%, 10% and 16% higher than the first quarter, respectively. While we expected to continue to see additional seasonality effects in 2024, as compared to 2023, we saw more muted effects from seasonality in the third quarter of 2024 as compared to the prior-year periods and the second quarter of 2024, reflecting, in part, pricing actions in our U.S. retail and foodservice channels. In general, any historical effects of seasonality have been more pronounced within our U.S. retail channel, with revenue contribution from this channel generally tending to be greater in the second and third quarters of the year, driven by increased levels of grilling activity, higher levels of purchasing by customers ahead of holidays, the impact of customer shelf reset activity and the timing of product restocking by our retail customers. In an environment of heightened uncertainty from recessionary and inflationary pressures, prolonged weakness in the plant-based meat category, competition and other factors impacting our business, we are unable to assess the ultimate impact on the demand for our products as a result of seasonality.

Previous wording

Gross profit consists of our net revenues less cost of goods sold. Gross margin is gross profit expressed as a percentage of our net revenues. Our cost of goods sold primarily consists of the cost of raw materials including ingredients and packaging, co-manufacturing fees, direct and indirect labor and certain supply costs, inbound and internal shipping and handling costs incurred in manufacturing our products, warehouse storage fees, plant and equipment overhead, depreciation and amortization expense, provision for excess and obsolete inventory, and accelerated depreciation on write-offs and disposals of certain fixed assets. Under certain circumstances, our cost of goods sold may also include underutilization and/or termination fees associated with our co-manufacturing agreements.

Current wording

Gross profit consists of our net revenues less cost of goods sold. Gross margin is gross profit expressed as a percentage of our net revenues. Our cost of goods sold primarily consists of the cost of raw materials including ingredients and packaging, co-manufacturing fees, direct and indirect labor and certain supply costs, inbound and internal shipping and handling costs incurred in manufacturing our products, warehouse storage fees, plant and equipment overhead, depreciation and amortization expense, provision for excess and obsolete inventory, accelerated depreciation on write-offs and disposals of certain fixed assets, and losses on sale and write-down of certain fixed assets. Under certain circumstances, our cost of goods sold may also include underutilization and/or termination fees associated with our co-manufacturing agreements.

Previous wording

•reviewing and adjusting our pricing architecture within certain channels including the recent price increases of certain of our products in our U.S. retail and foodservice channels;

Current wording

•reviewing and adjusting our pricing architecture within certain channels including price increases of certain of our products in our U.S. retail and foodservice channels;

Previous wording

Gross margin improvement may, however, continue to be negatively impacted by reduced capacity utilization if demand for our products continues to decline, investments in our production infrastructure across the U.S., EU and China in advance of anticipated demand, which may not materialize within the expected timeframe, investment in production personnel, partnerships and product pipeline, aggressive pricing strategies and increased discounting, increases in inventory provision, write-down or write-off of obsolete inventory and potentially increased sales to liquidation channels at lower prices, changes in our product and customer sales mix, expansion into new geographies and markets where cost and pricing structures may differ from our existing markets, and underutilization fees, termination fees and other costs to exit certain supply chain arrangements and product lines. Gross margin improvement may also be negatively impacted by the impact of inflation, and increasing labor costs, materials costs and transportation costs.

Current wording

Gross margin improvement may, however, continue to be negatively impacted by reduced capacity utilization if demand for our products continues to decline, investments in our production infrastructure across the U.S., EU and China in advance of anticipated demand, which may not materialize within the expected timeframe, investment in production personnel, partnerships and product pipeline, aggressive pricing strategies and increased discounting, increases in inventory provision, write-down or write-off of obsolete inventory and potentially increased sales to liquidation channels at lower prices, changes in our product and customer sales mix, expansion into new geographies and markets where cost and pricing structures may differ from our existing markets, and underutilization fees, termination fees and other costs to exit certain supply chain arrangements and product lines. Gross margin improvement is also expected to continue to be negatively impacted by the impact of inflation, and increasing labor costs, materials costs and transportation costs.

Previous wording

Three and Six Months Ended June 29, 2024 Compared to Three and Six Months Ended July 1, 2023 (unaudited)

Current wording

Three and Nine Months Ended September 28, 2024 Compared to Three and Nine Months Ended September 30, 2023 (unaudited)

Previous wording

Net revenues from U.S. retail sales in the three months ended June 29, 2024 decreased $3.6 million, or 7.5%, as compared to the prior-year period, primarily due to a 23.2% decrease in volume of products sold, primarily reflecting weak category demand and the lapping of substantial promotional sales to a club channel customer in the year-ago period, partially offset by a 20.5% increase in net revenue per pound, primarily driven by lower trade discounts, changes in product sales mix and price increases of certain of our products. U.S. retail channel net revenues in the three months ended June 29, 2024 included $0.8 million in ingredient sales. By product, the decrease in U.S. retail channel net revenues was primarily due to decreased sales of Beyond Burger, Beyond Beef, Beyond Breakfast Sausage and chicken products including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken, partially offset by increased sales of Beyond Steak and higher ingredient sales. Beyond Meat branded products were available at approximately 29,000 U.S. retail outlets as of June 2024.

Current wording

Net revenues from U.S. retail sales in the three months ended September 28, 2024 increased $4.5 million, or 14.6%, as compared to the prior-year period, primarily due to a 22.6% increase in net revenue per pound, partially offset by a 6.6% decrease in volume of products sold, primarily reflecting weak category demand and price elasticity effects. The increase in net revenue per pound was primarily driven by lower trade discounts and price increases of certain of our products, partially offset by changes in product sales mix. U.S. retail channel net revenues in the three months ended September 28, 2024 included $1,000 in ingredient sales. By product, the increase in U.S. retail channel net revenues was primarily due to increased sales of Beyond Burger, partially offset by decreased sales of Beyond Beef, Beyond Sausage and chicken products including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken. Beyond Meat branded products were available at approximately 28,000 U.S. retail outlets as of September 2024.

Previous wording

Net revenues from U.S. foodservice sales in the six months ended June 29, 2024 decreased $4.8 million, or 17.4%, as compared to the prior-year period, primarily driven by a 20.4% decrease in volume of products sold, primarily reflecting weak category demand and, to a lesser extent, distribution losses, partially offset by a 3.8% increase in net revenue per pound, primarily driven by changes in product sales mix and price increases of certain of our products, partially offset by higher trade discounts. By product, the decrease in U.S. foodservice channel net revenues was primarily due to decreased sales of Beyond Burger and Beyond Beef.

Current wording

Net revenues from U.S. foodservice sales in the three months ended September 28, 2024 increased $1.9 million, or 15.5%, as compared to the prior-year period, primarily due to a 7.9% increase in volume of products sold, primarily reflecting sales of chicken products to a U.S. QSR customer that did not occur in the year-ago period, and a 7.0% increase in net revenue per pound, primarily driven by price increases of certain of our products and changes in product sales mix, partially offset by higher trade discounts. By product, the increase in U.S. foodservice channel net revenues was primarily due to the increase in sales of chicken products including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken. Beyond Meat branded products were available at approximately 38,000 U.S. foodservice outlets as of September 2024.

Previous wording

Net revenues from international retail sales in the three months ended June 29, 2024 decreased $2.4 million, or 12.1%, as compared to the prior-year period, primarily due to a 6.9% decrease in net revenue per pound and a 5.5% decrease in volume of products sold, primarily reflecting reduced sales of chicken products in the EU and, to a lesser extent, demand softness in certain geographic regions. The decrease in net revenue per pound was primarily due to unfavorable changes in foreign currency exchange rates, increased trade discounts and pricing changes, partially offset by changes in product sales mix. By product, the decrease in international retail channel net revenues was primarily due to decreased sales of chicken products including Beyond Chicken Tenders and decreased sales of Beyond Beef. Beyond Meat branded products were available at approximately 37,000 international retail outlets as of June 2024.

Current wording

Net revenues from international retail sales in the three months ended September 28, 2024 increased $2.4 million, or 17.0%, as compared to the prior-year period, primarily due to a 10.5% increase in net revenue per pound and a 6.0% increase in volume of products sold, primarily reflecting distribution gains and increased demand in certain geographic regions. The increase in net revenue per pound primarily reflected lower trade discounts and changes in product sales mix, partially offset by price decreases of certain of our products and unfavorable changes in foreign currency exchange rates. By product, the increase in international retail channel net revenues was primarily due to increased sales of Beyond Burger, partially offset by decreased sales of Beyond Beef and chicken products including Beyond Chicken Tenders. Beyond Meat branded products were available at approximately 38,000 international retail outlets as of September 2024.

Previous wording

Net revenues from international foodservice sales in the three months ended June 29, 2024 decreased $0.5 million, or 2.5%, as compared to the prior-year period, primarily due to a 1.4% decrease in volume of products sold and a 0.9% decrease in net revenue per pound. The decrease in net revenue per pound was primarily due to unfavorable changes in foreign currency exchange rates and changes in product sales mix, partially offset by lower trade discounts and pricing changes. By product, the decrease in international foodservice channel net revenues was primarily due to decreased sales of Beyond Beef Crumbles. Beyond Meat branded products were available at approximately 25,000 international foodservice outlets as of June 2024.

Current wording

Net revenues from international foodservice sales in the three months ended September 28, 2024 decreased $3.1 million, or 17.2%, as compared to the prior-year period, primarily due to a 22.1% decrease in volume of products sold, primarily reflecting decreased sales of burger and chicken products to a large QSR customer in the EU, partially offset by a 6.2% increase in net revenue per pound. The increase in net revenue per pound primarily reflected lower trade discounts and price increases of certain of our products, partially offset by changes in product sales mix and unfavorable changes in foreign currency exchange rates. By product, the decrease in international foodservice channel net revenues was primarily due to decreased sales of burger and chicken products, particularly to a large QSR customer in the EU. Beyond Meat branded products were available at approximately 25,000 international foodservice outlets as of September 2024.

Previous wording

The following table presents our net revenues by channel in the six months ended June 29, 2024 as compared to the prior-year period:

Current wording

The following table presents our net revenues by channel in the nine months ended September 28, 2024 as compared to the prior-year period:

Previous wording

Net revenues in the six months ended June 29, 2024 decreased $25.6 million, or 13.2%, as compared to the prior-year period, primarily driven by a 15.0% decrease in volume of products sold, partially offset by a 2.0% increase in net revenue per pound. The decrease in volume of products sold primarily reflected weak category demand and reduced sales of Beyond Meat Jerky which has been discontinued. Net revenues from sales of Beyond Meat Jerky to TPP were $0 in the six months ended June 29, 2024, as compared to $5.3 million in the prior-year period, including the recognition of a $2.0 million non-refundable up-front fee in the six months ended July 1, 2023. The increase in net revenue per pound was primarily driven by price increases of certain of our products in our U.S. retail and foodservice channels, lower trade discounts and changes in product sales mix, partially offset by unfavorable changes in foreign currency exchange rates.

Current wording

Net revenues in the nine months ended September 28, 2024 decreased $19.9 million, or 7.4%, as compared to the prior-year period, primarily driven by a 12.6% decrease in volume of products sold, partially offset by a 5.8% increase in net revenue per pound. The decrease in volume of products sold primarily reflected weak category demand. Net revenues from sales of Beyond Meat Jerky to TPP were $0 in the nine months ended September 28, 2024, as compared to $5.3 million in the prior-year period, including the recognition of a $2.0 million non-refundable up-front fee in the nine months ended September 30, 2023. The increase in net revenue per pound was primarily driven by lower trade discounts, price increases of certain of our products and changes in product sales mix, partially offset by unfavorable changes in foreign currency exchange rates.

Previous wording

Net revenues from U.S. retail sales in the six months ended June 29, 2024 decreased $10.7 million, or 11.5%, as compared to the prior-year period, primarily due to a 17.5% decrease in volume of products sold, partially offset by a 7.1% increase in net revenue per pound. The decrease in volume of products sold primarily reflected weak category demand and reduced sales of Beyond Meat Jerky which has been discontinued, and lapping of substantial promotional sales to a club channel customer in the prior-year period. The increase in net revenue per pound was primarily driven by lower trade discounts, price increases of certain of our products and changes in product sales mix. U.S. retail channel net revenues in the six months ended June 29, 2024 included $2.4 million in ingredient sales. By product, the decrease in U.S. retail channel net revenues was primarily due to decreased sales of Beyond Burger, Beyond Meat Jerky, Beyond Beef, chicken products, including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken, Beyond Sausage, Beyond Meatballs and Beyond Breakfast Sausage, partially offset by increased sales of Beyond

Current wording

Net revenues from U.S. retail sales in the nine months ended September 28, 2024 decreased $6.2 million, or 5.1%, as compared to the prior-year period, primarily due to a 14.5% decrease in volume of products sold, partially offset by a 10.8% increase in net revenue per pound. The decrease in volume of products sold primarily reflected weak category demand. The increase in net revenue per pound was primarily driven by lower trade discounts, price increases of certain of our products and changes in product sales mix. U.S. retail channel net revenues in the nine months ended September 28, 2024 included $2.4 million in ingredient sales. By product, the decrease in U.S. retail channel net revenues was primarily due to decreased sales of Beyond Beef, Beyond Meat Jerky, chicken products, including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken, Beyond Sausage, Beyond Burger, Beyond Meatballs and Beyond Breakfast Sausage, partially offset by increased ingredient sales and increased sales of Beyond Steak. Net revenues from sales of Beyond Meat Jerky to TPP were $0 in the nine months ended September 28, 2024, as compared to $5.3 million for the nine months ended September 30, 2023, including the recognition of a $2.0 million non-refundable up-front fee.

Previous wording

Net revenues from U.S. foodservice sales in the three months ended June 29, 2024 decreased $2.4 million, or 18.9%, as compared to the prior-year period, primarily due to a 20.0% decrease in volume of products sold, primarily reflecting weak category demand and, to a lesser extent, distribution losses, partially offset by a 1.4% increase in net revenue per pound, primarily driven by price increases of certain of our products and changes in product sales mix, partially offset by increased trade discounts. By product, the decrease in U.S. foodservice channel net revenues was primarily due to decreased sales of Beyond Burger and Beyond Beef, partially offset by increased sales of chicken products including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken. Beyond Meat branded products were available at approximately 39,000 U.S. foodservice outlets as of June 2024.

Current wording

Net revenues from U.S. foodservice sales in the nine months ended September 28, 2024 decreased $2.8 million, or 7.1%, as compared to the prior-year period, primarily driven by a 11.7% decrease in volume of products sold, primarily reflecting weak category demand and, to a lesser extent, distribution losses, partially offset by a 5.3% increase in net revenue per pound, primarily driven by price increases of certain of our products and changes in product sales mix, partially offset by higher trade discounts. By product, the decrease in U.S. foodservice channel net revenues was primarily due to decreased sales of Beyond Burger, Beyond Beef and Beyond Beef Crumble, partially offset by increased sales of chicken products, including Beyond Chicken Tenders, Beyond Chicken Nuggets and Beyond Popcorn Chicken.

Previous wording

Net revenues from international retail sales in the six months ended June 29, 2024 decreased $4.1 million, or 12.0%, as compared to the prior-year period, primarily driven by an 8.7% decrease in volume of products sold, primarily reflecting reduced sales of chicken products in the EU and softer demand for certain products in Canada, and a 3.7% decrease in net revenue per pound. The decrease in net revenue per pound was primarily due to unfavorable changes in foreign currency exchange rates, higher trade discounts and reduced pricing of certain products, partially offset by changes in product sales mix. By product, the decrease in international retail channel net revenues was primarily due to decreased sales of chicken products, Beyond Beef and Beyond Sausage, partially offset by increased sales of Beyond Steak.

Current wording

Net revenues from international retail sales in the nine months ended September 28, 2024 decreased $1.7 million, or 3.5%, as compared to the prior-year period, primarily driven by a 4.2% decrease in volume of products sold, primarily reflecting reduced sales of chicken products in the EU and softer demand for certain products in Canada, partially offset by a 0.7% increase in net revenue per pound. The increase in net revenue per pound was primarily due to changes in product sales mix and lower trade discounts, partially offset by unfavorable changes in foreign currency exchange rates and price decreases in certain of our products. By product, the decrease in international retail channel net revenues was primarily due to decreased sales of chicken products, Beyond Beef and Beyond Sausage, partially offset by increased sales of Beyond Burger and Beyond Steak.

Previous wording

Net revenues from international foodservice sales in the six months ended June 29, 2024 decreased $6.0 million, or 15.0%, as compared to the prior-year period, primarily due to a 12.7% decrease in volume of products sold, primarily reflecting weak category demand, and a 2.6% decrease in net revenue per pound, primarily due to higher trade discounts and unfavorable changes in foreign currency exchange rates, partially offset by pricing changes. By product, the decrease in international foodservice channel net revenues was primarily due to decreased sales of Beyond Burger, chicken products and Beyond Beef Crumbles.

Current wording

Net revenues from international foodservice sales in the nine months ended September 28, 2024 decreased $9.1 million, or 15.7%, as compared to the prior-year period, primarily due to a 15.7% decrease in volume of products sold, primarily reflecting decreased sales of burger and chicken products to a large QSR customer in the EU, and weak category demand. Net revenue per pound remained flat as compared to the prior year-period primarily due to price increases in certain of our products and lower trade discounts, fully offset by changes in product sales mix and unfavorable changes in foreign currency exchange rates. By product, the decrease in international foodservice channel net revenues was primarily due to decreased sales of Beyond Burger, chicken products and Beyond Beef Crumble.

Previous wording

Cost of goods sold decreased $20.4 million, or 20.4%, to $79.5 million, in the three months ended June 29, 2024 as compared to the prior-year period. As a percentage of net revenues, cost of goods sold decreased to 85.3% of net revenues in the three months ended June 29, 2024, from 97.8% of net revenues in the prior-year period. The decrease in cost of goods sold was primarily due to lower volume of products sold, and, to a lesser extent, decreased cost per pound. On a per pound basis, cost of goods sold decreased primarily due to lower inventory provision, lower manufacturing costs including depreciation, and lower logistics costs, partially offset by higher materials costs.

Current wording

Cost of goods sold decreased $15.9 million, or 19.2%, to $66.7 million, in the three months ended September 28, 2024 as compared to the prior-year period. As a percentage of net revenues, cost of goods sold decreased to 82.3% of net revenues in the three months ended September 28, 2024, from 109.6% of net revenues in the prior-year period. The decrease in cost of goods sold was primarily due to decreased cost per pound, and, to a lesser extent, lower volume of products sold. On a per pound basis, cost of goods sold decreased primarily due to lower inventory provision, lower logistics costs and lower materials costs .

Previous wording

Cost of goods sold decreased $34.5 million, or 18.6%, to $151.4 million, in the six months ended June 29, 2024 as compared to the prior-year period. As a percentage of net revenues, cost of goods sold decreased to 89.7% of net revenues in the six months ended June 29, 2024 from 95.6% of net revenues in the prior-year period primarily due to lower volume of products sold, and, to a lesser extent, decreased cost per pound. On a per pound basis, cost of goods sold decreased primarily due to lower inventory provision and lower logistics costs, partially offset by higher materials costs.

Current wording

Cost of goods sold decreased $50.4 million, or 18.8%, to $218.1 million, in the nine months ended September 28, 2024 as compared to the prior-year period. As a percentage of net revenues, cost of goods sold decreased to 87.3% of net revenues in the nine months ended September 28, 2024 from 99.6% of net revenues in the prior-year period primarily due to lower volume of products sold, and, to a lesser extent, decreased cost per pound. On a per pound basis, cost of goods sold decreased primarily due to lower inventory provision and lower logistics costs, partially offset by higher materials costs.

Previous wording

Gross profit in the three months ended June 29, 2024 was $13.7 million as compared to $2.3 million in the prior-year period, an increase of $11.4 million, or 503.5%. Gross margin in the three months ended June 29, 2024 increased to 14.7% from 2.2% in the prior-year period. Gross profit and gross margin in the three months ended June 29, 2024 as compared to the prior-year period were positively impacted by lower cost of goods sold per pound and higher net revenue per pound, partially offset by decreased volume of products sold.

Current wording

Gross profit in the three months ended September 28, 2024 was $14.3 million as compared to loss of $7.3 million in the prior-year period, an increase of $21.6 million, or 297.2%. Gross margin in the three months ended September 28, 2024 increased to 17.7% from a negative gross margin of (9.6)% in the prior-year period. Gross profit and gross margin in the three months ended September 28, 2024 were positively impacted by increased net revenue per pound and decreased cost of goods sold per pound, partially offset by decreased volume of products sold.

Previous wording

Gross profit in the six months ended June 29, 2024 was $17.4 million as compared to $8.5 million in the prior-year period, an increase of $8.9 million, or 105.5%. Gross margin in the six months ended June 29, 2024 increased to 10.3% from 4.4% in the prior-year period. Gross profit and gross margin in the six months ended June 29, 2024 as compared to the prior-year period were positively impacted by lower cost of goods sold per pound and higher net revenue per pound.

Current wording

Gross profit in the nine months ended September 28, 2024 was $31.7 million as compared to $1.2 million in the prior-year period, an increase of $30.5 million, or 2,532.3%. Gross margin in the nine months ended September 28, 2024 increased to 12.7% from 0.4% in the prior-year period. Gross profit and gross margin in the nine months ended September 28, 2024 were positively impacted by decreased cost of goods sold per pound and higher net revenue per pound, partially offset by decreased volume of products sold. Improvements in gross profit and gross margin in the U.S. retail and U.S. foodservice channels were, in part, due to the pricing strategy implemented at the beginning of 2024.

Previous wording

Research and development expenses decreased $3.3 million, or 37.5%, in the three months ended June 29, 2024, as compared to the prior-year period. Research and development expenses decreased to 5.9% of net revenues in the three months ended June 29, 2024 from 8.6% of net revenues in the prior-year period. The decrease in research and development expenses was primarily due to lower expenses from in-sourcing trial production work, lower salaries and related expenses resulting from the reduction in headcount implemented in 2023, and lower scale-up expenses compared to the prior-year period.

Current wording

Research and development expenses decreased $3.0 million, or 32.7%, in the three months ended September 28, 2024, as compared to the prior-year period. Research and development expenses decreased to 7.6% of net revenues in the three months ended September 28, 2024 from 12.1% of net revenues in the prior-year period. The decrease in research and development expenses was primarily due to lower salaries and related expenses resulting from the reduction in headcount implemented in 2023 and lower expenses from in-sourcing trial production work compared to the prior-year period.

Previous wording

Research and development expenses decreased $5.9 million, or 27.6%, in the six months ended June 29, 2024, as compared to the prior-year period. Research and development expenses decreased to 9.1% of net revenues in the six months ended June 29, 2024 from 10.9% of net revenues in the prior-year period. The decrease in research and development expenses was primarily due to lower expenses from in-sourcing trial production work, lower salaries and related expenses resulting from the reduction in headcount and lower scale-up expenses compared to the prior-year period.

Current wording

Research and development expenses decreased $8.8 million, or 29.2%, in the nine months ended September 28, 2024, as compared to the prior-year period. Research and development expenses decreased to 8.6% of net revenues in the nine months ended September 28, 2024 from 11.2% of net revenues in the prior-year period. The decrease in research and development expenses was primarily due to lower salaries and related expenses resulting from the reduction in headcount and lower expenses from in-sourcing trial production work compared to the prior-year period.

Previous wording

SG&A expenses decreased $5.3 million, or 11.2%, to $42.2 million, or 45.2% of net revenues in the three months ended June 29, 2024, from $47.5 million, or 46.5% of net revenues in the prior-year period. The decrease in SG&A expenses was primarily due to $2.1 million in lower product donation expenses, $1.8 million in lower share-based compensation expense, $1.3 million in lower advertising expenses, $0.9 million in lower outbound freight expenses, and $0.6 million in lower salaries and related expenses, partially offset by $0.7 million in higher supply chain expenses and $0.5 million in higher commissions.

Current wording

SG&A expenses decreased $14.2 million, or 26.6%, to $39.1 million, or 48.2% of net revenues in the three months ended September 28, 2024, from $53.3 million, or 70.7% of net revenues in the prior-year period. The decrease in SG&A expenses was primarily due to $3.8 million in lower bad debt expense, $3.3 million in lower salaries and related expenses, $3.2 million in lower consulting expenses, $2.1 million in lower general insurance expenses that included $2.0 million in business interruption insurance recovery associated with a cybersecurity incident at a supplier in 2023, $1.8 million in lower advertising expenses, $1.5 million in lower samples expenses and $1.1 million in lower outbound freight expenses, partially offset by $2.4 million in higher product donation expenses resulting from the donation of unsaleable finished goods.

Previous wording

SG&A expenses decreased $9.9 million, or 10.0%, to $89.4 million, or 53.0% of net revenues in the six months ended June 29, 2024, from $99.4 million, or 51.1% of net revenues in the prior-year period. The decrease in SG&A expenses was primarily due to $5.6 million in lower share-based compensation expense, $4.8 million in lower advertising expenses, $3.4 million in lower loss on sale of fixed assets, $3.3 million in lower salaries and related expenses, $3.2 million in lower product donation expenses and $2.1 million in lower outbound freight expenses, partially offset by $1.9 million in higher supply chain expenses, $1.7 million in higher consulting and professional services expenses, and $0.6 million in higher commissions. SG&A expenses in the six months ended June 29, 2024 included $7.5 million related to a class action settlement agreement, which is subject to preliminary and final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.

Current wording

SG&A expenses decreased $24.1 million, or 15.8%, to $128.5 million, or 51.5% of net revenues in the nine months ended September 28, 2024, from $152.6 million, or 56.6% of net revenues in the prior-year period. The decrease in SG&A expenses was primarily due to $6.6 million in lower advertising expenses, $6.6 million in lower salaries and related expenses, $6.1 million in lower share-based compensation expense, $3.6 million in lower bad debt expense, $3.4 million in lower loss on sale of fixed assets, $3.2 million in lower outbound freight expenses, $3.1 million in lower general insurance expenses that included $2.0 million in business interruption insurance recovery associated with a cybersecurity incident at a supplier in 2023, $2.3 million in lower samples expense and $2.0 million in lower consulting expenses, partially offset by $1.8 million in higher supply chain related expenses. SG&A expenses in the nine months ended September 28, 2024 included $7.5 million related to a class action settlement agreement, which is subject to final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.

Previous wording

Loss from operations in the three months ended June 29, 2024 was $33.9 million compared to $53.8 million in the prior-year period. The decrease in loss from operations was primarily driven by higher gross profit and the reduction in operating expenses.

Current wording

Loss from operations in the three months ended September 28, 2024 was $30.9 million compared to $69.6 million in the prior-year period. The decrease in loss from operations was driven by increased gross profit and reduced operating expenses.

Previous wording

Loss from operations in the six months ended June 29, 2024 was $87.4 million compared to $111.5 million in the prior-year period. The decrease in loss from operations was primarily driven by higher gross profit and the reduction in operating expenses. Loss from operations in the six months ended June 29, 2024 was negatively impacted by $7.5 million in SG&A expenses related to a class action settlement agreement, which is subject to preliminary and final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.

Current wording

Loss from operations in the nine months ended September 28, 2024 was $118.3 million compared to $181.1 million in the prior-year period. The decrease in loss from operations was driven by increased gross profit and reduced operating expenses. Loss from operations in the nine months ended September 28, 2024 was negatively impacted by $7.5 million in SG&A expenses related to a class action settlement agreement, which is subject to final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.

Previous wording

Total other (expense) income, net, in the three months ended June 29, 2024 of $(0.6) million consisted primarily of $(1.2) million in realized and unrealized foreign currency transaction losses due to unfavorable changes in foreign currency exchange rates of the Euro and the Chinese Yuan and $(1.0) million in interest expense from the amortization of convertible debt issuance costs, partially offset by $1.7 million in interest income. Total other (expense) income, net, in the three months ended July 1, 2023 of $0.8 million consisted primarily of $2.9 million in interest income, partially offset by $(1.0) million in realized and unrealized foreign currency transaction losses due to unfavorable changes in foreign currency exchange rates of the Euro and the Chinese Yuan and $(1.0) million in interest expense from the amortization of convertible debt issuance costs.

Current wording

Total other income, net, in the three months ended September 28, 2024 of $4.4 million consisted primarily of $4.1 million in net realized and unrealized foreign currency transaction gains due to favorable changes in foreign currency exchange rates of the Euro and the Chinese Yuan, and $1.4 million in interest income, partially offset by $1.0 million in interest expense from the amortization of convertible debt issuance costs. Total other expense, net, in the three months ended September 30, 2023 of $0.7 million consisted primarily of $2.5 million in net realized and unrealized foreign currency transaction losses and $1.0 million in interest expense from the amortization of convertible debt issuance costs, partially offset by $2.8 million in interest income.

Previous wording

Total other (expense) income, net, in the six months ended June 29, 2024 of $(1.4) million consisted primarily of $(3.5) million in realized and unrealized foreign currency transaction losses due to unfavorable changes in foreign exchange rates of the Euro and Chinese Yuan and $(2.0) million in interest expense from the amortization of convertible debt issuance costs, partially offset by $3.7 million in interest income and $0.5 million in subsidies received from the Jiaxing Economic Development Zone Finance Bureau related to our investment in our subsidiary, Beyond Meat (Jiaxing) Food Co., Ltd. Total other (expense) income, net, in the six months ended July 1, 2023 of $2.7 million consisted primarily of $5.7 million in interest income, partially offset by $(2.0) million in interest expense from the amortization of convertible debt issuance costs and $(0.7) million in realized and unrealized foreign currency transaction losses due to unfavorable changes in foreign currency exchange rates of the Euro and Chinese Yuan.

Current wording

Total other income, net, in the nine months ended September 28, 2024 of $2.9 million consisted primarily of $5.1 million in interest income, $0.6 million in net realized and unrealized foreign currency transaction gains due to favorable changes in foreign currency exchange rates of the Euro and Chinese Yuan and $0.5 million in subsidies received from the Jiaxing Economic Development Zone Finance Bureau related to our investment in our subsidiary, Beyond Meat (Jiaxing) Food Co., Ltd., partially offset by $3.0 million in interest expense from the amortization of convertible debt issuance costs. Total other income, net, in the nine months ended September 30, 2023 of $1.9 million consisted primarily of $8.4 million in interest income, partially offset by $3.0 million in interest expense from the amortization of convertible debt issuance costs and $3.3 million in net realized and unrealized foreign currency transaction losses due to unfavorable changes in foreign currency exchange rates of the Euro and Chinese Yuan.

Previous wording

Net loss in the three months ended June 29, 2024 was $34.5 million, as compared to $53.5 million in the prior-year period. Net loss per common share in the three months ended June 29, 2024 was $0.53, as compared to $0.83 in the prior-year period. The decrease in net loss was primarily driven by higher gross profit, lower operating expenses and a $0.5 million reduction in losses related to TPP, partially offset by the reduction in Total other (expense) income, net.

Current wording

Net loss in the three months ended September 28, 2024 was $26.6 million, as compared to $70.5 million in the prior-year period. Net loss per common share in the three months ended September 28, 2024 was $0.41, as compared to $1.09 in the prior-year period. The decrease in net loss was primarily driven by higher gross profit, lower operating expenses and higher Total other income (expense), net.

Previous wording

Net loss was $88.8 million in the six months ended June 29, 2024, as compared to $112.5 million in the prior-year period. Net loss per common share in the six months ended June 29, 2024 was $1.37, as compared to $1.76 in the prior-year period. The decrease in net loss was primarily due to higher gross profit, lower operating expenses and a $3.7 million reduction in losses related to TPP, partially offset by a reduction in Total other (expense) income, net. Net loss in the six months ended June 29, 2024 was negatively impacted by $7.5 million in SG&A expenses related to a class action settlement agreement, which is subject to preliminary and final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.

Current wording

Net loss in the nine months ended September 28, 2024 was $115.4 million, as compared to $183.0 million in the prior-year period. Net loss per common share in the nine months ended September 28, 2024 was $1.78, as compared to $2.85 in the prior-year period. The decrease in net loss was primarily due to higher gross profit, lower operating expenses, higher Total other income (expense), net and a $3.8 million reduction in losses related to TPP. Net loss in the nine months ended September 28, 2024 was negatively impacted by $7.5 million in SG&A expenses related to a class action settlement agreement, which is subject to final court approval, in connection with the settlement of certain consumer class action lawsuits that originated in 2022.