Past Meat launches a brand new steak different with a concentrate on well being

Beyond Meat in El Segundo, California on May 30, 2024.

Christina House | Los Angeles Times |

More than meat will introduce an alternative to whole muscle steaks as part of its strategy to attract health-conscious consumers.

CEO Ethan Brown said Wednesday that the launch will likely involve a partnership with a restaurant chain known for its healthier food, a departure from his previous strategy of teaming up with fast-food chains like Dunkin' and McDonald's.

More than six months ago, Beyond announced a turnaround strategy that included cost cuts, price increases and the discontinuation of the jerky product it produced in a joint venture with PepsiCo. To revive sagging sales, the company's marketing has focused on the health benefits of a plant-based diet through partnerships with organizations like the American Cancer Society and influencer deals with college athletes. While health has always been a part of Beyond's messaging to consumers, the company also previously placed more emphasis on climate change.

In recent months, Brown has attributed some of the plant-based meat industry's problems to misinformation from the meat industry and ranchers, such as skepticism about plant-based meat processing.

Beyond already sells plant-based steak tips, but the new product mimics the texture of a fillet using mycelium, the root-like part of mushrooms. Brown sees the steak alternative as a substitute for chicken, as a topping for salads and as a filling for burritos as a source of protein.

“The focus was on a very small number of ingredients, a lot of protein and very little saturated fat,” he said.

The company is also bringing reformulated versions of its Beyond Burger and Beyond Chicken to grocery stores. The new products have short ingredient lists in hopes of winning over customers who previously thought plant-based meat was too processed.

Beyond declined to provide details on when its latest steak and chicken dishes will launch.

Loss of guests and investors

Beyond's market value once exceeded $14 billion, leading to major investments in plant-based meat and a flood of competitors.

But today the company has a market cap of less than $400 million, reflecting investor concerns about the company's health and the industry's faltering revenues. The stock has lost a third of its value by 2024.

In the second quarter, Beyond reported net sales of $93.2 million, down 8.8% from the same period last year and down 37% from the second quarter of 2021.

After Beyond went public five years ago, the company's stock rose sharply as more consumers bought the plant-based meat at grocery stores and fast-food restaurants like Dunkin'. The Covid-19 pandemic further boosted sales as lockdowns led to more cooking at home – but the rebound didn't last.

Popular partnerships with restaurant giants such as McDonald's and Yum Brands did not result in permanent menu items in the U.S., although Beyond had more success in the chains' European markets. The joint venture with PepsiCo resulted in a single product, now-discontinued jerky, which weighed on margins for several quarters.

At the same time, the broader category began to falter, with consumers losing interest in trying plant-based meats and often complaining about the taste or worrying about the processing.

Sales of plant-based foods, which include dairy, meat, egg and butter alternatives, rose just 1% to $8.1 billion last year, according to data from the Plant Based Foods Association. The dairy alternatives segment accounts for about a quarter of total retail sales in the category, followed by plant-based meat.

As consumer tastes changed, investors also lost interest.

Kellogg considered spinning off or selling its plant-based business as part of a broader three-part split of the company, but ultimately decided to keep it part of the Kellanovaits snack spinoff, which Mars is buying. Impossible Foods has been rumored to be considering an IPO since 2021, but the company's CEO said earlier this year that it could sell or go public in the next three years, a much longer time horizon.

However, Beyond has no plans to sell itself, Brown told CNBC.

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