Beyond Meat to launch new steak alternative with focus on health

Beyond Meat The company plans to introduce a whole muscle steak alternative as part of a shift in its strategy to appeal to health-conscious consumers.

CEO Ethan Brown said Wednesday that the rollout will likely include partnerships with restaurant chains known for offering healthier meals, such as Dunkin’ Donuts and McDonald’s.

More than six months ago, Beyond announced a turnaround strategy that included cutting costs, raising prices and discontinuing production of the jerky products it made through a joint venture. PepsiCoTo revive sagging sales, the company has been emphasizing the health benefits of a plant-based diet in its marketing, through partnerships with organizations like the American Cancer Society and influencer deals with college athletes. Health has always been part of Beyond’s pitch to consumers, but the company also previously placed more emphasis on climate change.

Brown has argued in recent months that the plant-based meat industry’s woes are partly due to misinformation from the meat industry and animal farmers, including skepticism about processed plant-based meat.

Beyond already sells a plant-based steak, but its new product uses mycelium (the root-like part of a fungus) to replicate the texture of a filet, and Brown envisions the steak substitute as a chicken substitute and a protein source to top salads or fill burritos.

“The emphasis in this regard has been on very few ingredients, very high protein and very low saturated fat,” he said.

The company is also introducing revamped versions of its Beyond Burger and Beyond Chicken to grocery stores, with the new products featuring shorter ingredient lists, in an effort to appeal to customers who believe plant-based meat is too processed.

Beyond declined to provide details about when its newest steak and chicken dishes might be available.

Beyond’s market capitalization briefly topped $14 billion, spurring increased investment in the plant-based meat industry and a surge in competitors.

But the company’s market capitalization is now below $400 million, reflecting investor concerns about the health of the business and sluggish industry sales. The company’s shares have lost a third of their value in 2024.

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

Beyond’s stock price soared after it went public five years ago as more consumers bought the company’s plant-based meat from grocery stores and fast-food restaurants like Dunkin’ Donuts. Sales rose further during the coronavirus pandemic as lockdowns led to more people cooking at home, but the gains were short-lived.

McDonald’s and Yum Brand Beyond never made it onto the menu in the U.S., but it has had more success in Europe, where a single product, a now-discontinued jerky product, weighed on margins at its joint venture with PepsiCo for several quarters.

At the same time, the broader category began to struggle: Consumers lost interest in trying plant-based meat, complained about the taste or had concerns about how it was processed.

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

As consumer tastes changed, investors lost interest.

Kellogg considered splitting its plant-based business into three divisions and spinning it off or selling it, but ultimately opted to keep it as part of the company. KeranovaImpossible Foods, the snack-food division of the company that Mars is acquiring, has been rumored to be considering an IPO since 2021, but the company’s CEO said earlier this year that a sale or public offering could happen within the next three years, a much longer time frame.

But Beyond has no plans to sell, Brown told CNBC.