Shares of Beyond Meat surged as much as 33% Friday after the plant-based protein maker reported a smaller loss in the fourth quarter compared to a year earlier, indicating the company's cost-cutting efforts are working.
The faux-meat firm, which slashed 200 jobs last quarter as part of a plan to reach positive cash flow within the second half of 2023, showed Thursday it is making progress toward that aim.
Beyond Meat posted a $66.9 million net loss for the last three months of 2022, or $1.05 per share, down from $80.4 million the same quarter a year prior. Analysts had expected a steeper loss of $1.18 per share.
The company expects to trim operating expenses by 22% this year, following a 9% rise in 2022.
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"We are making solid progress in our transition to a sustainable growth model, one that emphasizes the achievement of cash flow positive operations within the second half of 2023," Beyond Meat president and CEO Ethan Brown said in a statement accompanying the results.
He added, "Our fourth quarter results clearly demonstrate delivery against our strategy and plan, including solid sequential progress on margin recovery and operating expense reduction, and continued inventory drawdown."
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Still, Beyond Meat has been hammered by rising costs and waning demand for vegan meat alternatives. The company's net revenue tumbled 21% to $79.9 million in the fourth quarter from a year earlier, but was able to beat Wall Street's expectations for the first time since June 2021. Analysts had expected revenue of $75.7 million.
The company also offered an upbeat full-year revenue forecast of $375 million to $415 million for this year.
"While the outlook for 2023 is encouraging, it is worth noting the company has had to lower its guidance several times over the past few years," said Arun Sundaram, senior equity analyst at CFRA Research.
Sundaram added, "Nonetheless, investors may be optimistic that 2022 marked the low point for the company."
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Reuters contributed to this report.
