Beyond Meat flags material weakness as financial strain deepens
Leadership changes and falling sales add pressure to an already difficult year
USA – Beyond Meat has disclosed that it expects to report a material weakness in its internal controls after notifying regulators in early November that it would delay the release of its third-quarter financial results.
The plant-based meat producer said in a Nov. 3 notice of late filing with the US Securities and Exchange Commission that it was postponing the earnings report by about one week in order to complete work related to an anticipated non-cash impairment charge for the three months ended Sept. 27.
The impairment is linked to certain long-term assets, and the company said additional time was required to properly measure the charge before finalizing its quarterly results.
Following that disclosure, Beyond Meat confirmed it has begun a review of its internal control framework and is preparing a remediation plan to address the identified material weakness.
In a Nov. 12 regulatory filing, the company outlined several steps under consideration, starting with increased investment in its accounting function through the recruitment of additional staff with technical accounting and public company reporting experience.
Beyond Meat also said it plans to introduce targeted training programs for key finance and accounting employees, while relying more heavily on external accounting advisers for added oversight and technical support.
Additional measures include tighter review and approval procedures for financial statements, along with a structured review process for significant and non-routine transactions.
Pressure from declining performance
These accounting and leadership developments come during a turbulent period for the company, which has seen its share price fall by roughly 70% year to date amid weaker demand for plant-based foods and ongoing legal and governance challenges.
In August, Food Dive reported that Beyond Meat was taking longer to settle supplier payments as revenue continued to slide, citing CreditSafe data showing its average payment delay had doubled from a year earlier to 19 days.
Around the same time, media reports raised concerns about the company’s cash position, though a Beyond Meat spokesperson said the business had no intention of filing for bankruptcy in a statement also shared on its official X account.
Operational performance has continued to deteriorate, with the company reporting a 19% year-on-year decline in second-quarter sales before further revenue erosion in the third quarter.
During the third quarter, gross profit dropped to US$7.2 million (US$7.2m) from US$14.3 million (US$14.3m) in the same period last year, reflecting both lower sales and ongoing cost pressures.
Operating expenses for the quarter included US$77.4 million (US$77.4m) in non-cash impairment charges tied to long-lived assets, according to a Nov. 10 press release.
Leadership changes
Against this backdrop, corporate controller Luo is exiting the company after slightly more than a year in the role, having joined Beyond Meat in May 2024 from Herbalife.
Chief Financial Officer Lenny Kutua, who joined the company in 2019 and assumed the CFO position in October 2022 after prior roles at Jefferies, KeyBanc Capital Markets and Goldman Sachs, remains in place as Beyond Meat works through its financial and operational challenges.
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