Beyond Meat Q2 2026 Earnings Call Transcript

Quartr
Provided by Quartr
August 5, 2026

Key Takeaways

  • Positive Sentiment: Second-quarter revenue of $68.8 million exceeded the company’s guidance range, while the year-over-year decline improved to 8.2% from 15.3% in Q1 and 19.7% in Q4 2025.
  • Positive Sentiment: Gross margin improved sequentially to 8.5%, operating expenses fell 19% year over year, and cash use excluding financing activities declined 44% to approximately $18 million. Management cited production consolidation, lower material and logistics costs, and ongoing SG&A reductions as drivers.
  • Negative Sentiment: Core U.S. and food-service operations remain under pressure: U.S. retail revenue fell 9.9%, U.S. food service declined 27.6%, and international food service dropped 16% year over year. Lower volumes also continue to hurt fixed-cost absorption and adjusted EBITDA remained negative at $27.7 million.
  • Positive Sentiment: Europe and Canada were identified as near-term growth engines, with international retail revenue up 16.5%; the company plans additional investment in those markets while launching products such as Beyond Steak Filet, Beyond Breakfast Sausage, and the new Beyond Immerse functional beverage.
  • Neutral Sentiment: Management is broadening Beyond Meat beyond plant-based meat into functional nutrition and beverages, but provided limited visibility and guided third-quarter revenue to approximately $60 million–$65 million, reflecting continued uncertainty and volatility.
AI Generated. May Contain Errors.
Earnings Conference Call
Beyond Meat Q2 2026
00:00 / 00:00

Transcript Sections

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Operator

Good day, everyone. Once again, thank you for your patience, and we would like to welcome everyone to Beyond Meat's Second Quarter 2026 Conference Call. At this time, all participants are in a listen-only mode. Later, you'll have the opportunity to ask questions during the question-and-answer session. To ask a question, you may press star and then one on your touch-tone phones. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. It is now my pleasure to turn the conference call over to Paul Sheppard, Vice President of FP&A and Investor Relations. Please go ahead.

Paul Sheppard
Paul Sheppard
VP of Financial Planning and Analysis and Investor Relations at Beyond Meat

Thank you. Hello, everyone, and thank you for participating in today's call. Joining me are Ethan Brown, Founder, President, and Chief Executive Officer, and Lubi Kutua, Chief Financial Officer and Treasurer. By now, everyone should have access to our second quarter 2026 earnings press release, filed today after market close. This document is available in the investor relations section of Beyond Meat's website at www.beyondmeat.com. Before we begin, please note that during the course of this call, management may make forward-looking statements within the meaning of the federal securities laws. These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Forward-looking statements in our earnings release, along with the comments on this call, are made only as of today and will not be updated as actual events unfold.

Paul Sheppard
Paul Sheppard
VP of Financial Planning and Analysis and Investor Relations at Beyond Meat

We refer you to today's press release, our quarterly report on Form 10-Q for the quarter ended June 27th, 2026, to be filed with the SEC, our annual report on Form 10-K for the fiscal year ended December 31st, 2025, filed with the SEC, along with other filings with the SEC for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Please note that on today's call, management may reference adjusted EBITDA, adjusted loss from operations, and adjusted net loss, which are non-GAAP financial measures. While we believe these non-GAAP financial measures provide useful information for investors, any reference to this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

Paul Sheppard
Paul Sheppard
VP of Financial Planning and Analysis and Investor Relations at Beyond Meat

Please refer to today's press release for a reconciliation of these non-GAAP financial measures to their most comparable GAAP measures. With that, I'd now like to turn the call over to Ethan Brown.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Thank you, Paul, and good afternoon, everyone. I'll start with our second quarter results, then turn to how we are executing our turnaround across three pillars. Beginning with net revenues, we came in at $68.8 million, roughly $4 million above the high end of our $60 million-$65 million guidance range. This figure headlines a quarter of sequential progress, even if it is slower than we would like. Specifically, net revenues were down 8.2% year-over-year, an improvement from year-over-year declines of 15.3% in Q1 2026 and 19.7% in Q4 2025. Gross margin tells a similar story at 8.5%, roughly five and six points better than Q1 2026 and Q4 2025 respectively. Importantly, this is the last quarter to carry the drag of accelerated depreciation tied to cessation of our China operations, a weight equal to more than two points of margin this quarter.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Operating expenses of $36.7 million represented a 15% sequential decline and a 19% decline year-over-year, while EBITDA of negative $27.7 million is a slight improvement over the first quarter of 2026. Reduced cash use was a more pronounced improvement, which excluding financing activities, fell to approximately $18 million, a 44% reduction or $14 million less than cash used in the year-ago period. All in a quarter of positive momentum with substantial ground still to cover. Before diving into our forward path, I'll now give some additional detail around select components of our results, starting with net revenues. Our core plant-based meat business continues to face pressure in U.S. retail and food service and in global food service consistent with category trends. However, this pressure was partially offset by strong growth in Europe and Canada, where retail was up by double digits in both markets year-over-year respectively.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

In the U.S., we are seeing some signs of stabilization in certain pockets of U.S. retail with our core burger, ground beef, and dinner sausage products demonstrating resiliency in specific, though certainly not all accounts. We are hopeful that these positive signs endure and strengthen, but are also acutely aware that misinformation regarding the health of our products continues to impact our retail and food service businesses in the United States. As I've often shared over the years, we've responded to this misinformation by further leaning into the health of our portfolio, raising the bar on its nutritional profile while working extensively with health institutions, physicians, nutritionists, and universities. That work has earned recognition from the American Heart Association and American Diabetes Association, among others, and is buttressed by clinical trials by leading researchers as well as consumer case studies.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

These efforts notwithstanding, we still operate in a world where clean protein from faba beans grown by farmers in the rich soils of North Dakota and Montana, blended with heart healthy avocado oil, has been in the main tarnished by incumbent industry funded campaigns. To this end, we are increasingly addressing the source of this information in our efforts to educate consumers. Most recently, our Don't Believe the Cropaganda campaign was named by Ad Age as one of the top five creative ads to know about right now and voted a top five campaign in the publication's best campaign of the month reader poll. This upper funnel education work is being done simultaneously with targeted lower funnel activities, including shopper marketing programs at leading retailers that clearly emphasize what our products actually offer. Strong macronutrient content and ratios, clean ingredient decks, and compelling taste.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Turning now to operations, as we move past many of the drags of elevated operating expenses and higher cost inventory, the underlying strength of our operations is beginning to emerge as we see strong execution across our global production network and a notable sequential reduction in cost of goods sold. The quarter's margin reflects early returns from some of this execution. First, we consolidated a production network and are finishing trials on our new continuous line at our Columbia, Missouri facility, absorbing volume that had previously been outsourced and improving conversion costs year-over-year. Second, we reduced certain material costs through contract renegotiation with further savings in progress through RFPs, secondary sourcing, and formulation adjustments. Third, we consolidated warehouses, lowered logistics expense, and exited less profitable product lines.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

As in prior quarters, the benefit of these programs was muted by lower volume and the resulting under absorption of overhead, a persistent overhang we are aiming to address through a combination of growth programs and facilities planning. Finally, as noted at the onset, operating expenses continue to fall, and while benefiting from certain non-routine items, mainly reflect the impact of ongoing focus on SG&A and transformation work required to position the business for sustainable operations. Moving from the quarter's results to our path forward, I'll now focus my comments around three pillars intended to deliver the enterprise to sustainable growth. These are, one, invest in growth in Europe and Canada, while continuing to work to stabilize our core U.S. business. Two, complete our evolution from a narrow focus on plant-based meat to a broader focus on nutrition as Beyond the plant protein company.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Three, drive operational efficiency and unit economic improvement. I'll now turn to the first pillar. Europe and Canada present our clearest near term growth engines for our core product lines, and we are investing behind them accordingly. In Europe, we are cautiously encouraged by markets such as Germany and the U.K. As well as performance therein, while in Canada, continue to enjoy strong retail distribution. In both markets, we plan to invest behind this growth, as well as bring innovation to the consumer. Here in the U.S., in addition to the upper and lower funnel marketing campaigns that I discussed earlier, we continue to bring new center-of-the-plate protein to market as we seek to stabilize U.S. net revenues. Beyond Steak Filet made its retail debut this quarter.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Since launching on a direct-to-consumer platform, Beyond Test Kitchen, in late 2025, it's become one of our best-selling items online, with strong consumer reviews for taste, texture, and nutrition. It delivers 28 grams of plant protein, three grams of fiber, and one gram of saturated fat per serving from avocado oil, and is one of more than 20 products in our portfolio to earn Clean Label Project certification. We believe it is one of our most compelling center-of-the-plate innovations since the Beyond Burger. It launched at Wegmans and H-E-B in July, followed by Meijer, and we expect additional retailers to come. We are also building stronger brand blocks in frozen retail with existing products. Beyond Chicken Pieces Spicy Buffalo rolled out to more than 2,000 Kroger stores nationwide. 21 grams of plant protein, half a gram of saturated fat, no cholesterol, and 130 calories.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Like the original variety, it meets non-GMO project standards. Together, they are the first plant-based chicken products certified by the Clean Label Project. We launched our new Beyond Breakfast Sausage lineup, links and patties, original and spicy, at Kroger, Sprouts, and Whole Foods Market nationwide, strengthening our position in the breakfast category. With that, I'll now cover our second pillar, the broadening of our company aperture and entry into faster-growing adjacent markets. For nearly two decades, we have innovated with plants under intense scrutiny, and we've made a habit of turning attacks into strengths. As noted when misinformation campaigns falsely painted our product as unhealthy, we made them even healthier. When those campaigns disingenuously sought to seed doubt about our ingredients, we pushed the envelope on clean and simple formulations, and as mentioned previously, now hold more than 20 Clean Label Project certifications.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Throughout this journey, we've become exceptionally good at making simple plant-based ingredients perform as delicious center-of-the-plate proteins, leveraging significant investments across plant biology, chemistry, and functionality. These capabilities travel, and coupled with the extraordinary nutrient power of plants, form the basis of our second strategic pillar. As we enter adjacent categories, we are not looking to repeat what has already been done. Instead, we apply a different lens. We seek to deliver powerful phytonutrients that are often under-consumed in modern diets, but can be so essential to optimized health. Today, many products make claims that deliver a light dusting of phytonutrients, when in fact, clinically meaningful amounts are required to create useful signals in the body. Our system is intended to avoid that trap. You can see early signs of this strategy in the greater inclusion of fiber across our lines, from beverage, to ground, to steak.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

The first product to launch under this expanded aperture targets the large and growing functional drink market. Beyond Immerse is a clear, lightly carbonated beverage built around four plant superpowers: protein, fiber, antioxidants, and electrolytes. In doing so, it addresses four distinct functional beverage categories, protein, fiber, vitamin, and electrolyte drinks, in a single refreshing format. Each can delivers 20 grams of clean plant protein for muscle health, five to seven grams of fiber for gut health, antioxidants for immunity and recovery, and electrolytes for hydration, all at 100 to 110 calories. As with Beyond Steak Filet, we introduced Immerse through Beyond Test Kitchen allowing us to engage consumers directly, gather feedback, and bring our community into the innovation process. In keeping with our rapid and relentless innovation program, we turned iterations quickly.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

After launching online what was then our latest iteration in a sleek green can, Immerse has averaged 4.7 out of 5 stars on submitted reviews on our direct-to-consumer platform. I call this version the then latest iteration, as we have just launched our newest version, leveraging the natural sweetness of agave as part of our rollout with Big Geyser, the New York distributor. This sequence, access our community through our direct-to-consumer platform, engage and learn from early adopters who become part of our innovation process, then move at a deliberate pace into a focused geography, innovating along the way, is at the center of our adjacent market strategy. Over time, we intend to build a portfolio across relevant adjacencies unified by a single product strategy, delivering powerful, delicious, and convenient plant-based nutrition across consumer need states.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

As we do so, you will also see us return to a playbook that we used extensively while building our business. Athletes who understand the superpowers of plants and what they can do to build, fuel, and restore the body. I'd encourage you to check out our latest work with Josh Hart of the world champion New York Knicks. Finally, to our third pillar. We'll remain focused on operating expenses, unit economics, fixed cost absorption, and cash use. Despite recent progress, we have a great deal of work ahead. We plan to keep downward pressure on operating expenses and intend to further pursue margin gains by optimizing our production system, including the new continuous line that I referenced in Columbia, and through RFPs across ingredients and materials.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

We plan to better calibrate our facilities to volume, even as we seek to execute the above articulated two-track return to growth and bring higher throughput to our production facilities and lines. We will continue to take steps, large and small, with the goal of reaching cash flow positive operations as quickly as possible. In closing, we've done a lot of spade work toward what I believe will be an exciting turnaround. We continue to be focused on simultaneously stabilizing our core business, improving our cost structure, and expanding into faster-growing functional food and beverage categories. With a more efficient operating model, a disciplined and cutting-edge approach to innovation, and a focused go-to-market strategy, we believe we can deliver improved financial performance and the extraordinary powers of plant-based nutrition to an ever-broadening base of consumers.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

With that, I'll turn the call over to Lubi to review our second quarter financials in greater detail.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Thank you, Ethan, and hello, everyone. I'll begin my remarks today by reviewing our second quarter financial results in a bit more detail, and will then provide some brief comments on our third quarter outlook before opening up the call for your questions. Net revenues decreased 8.2% to $68.8 million in the second quarter of 2026, compared to $75 million in the year-ago period. The decrease in net revenues was primarily driven by a 9.5% decrease in volume of products sold, partially offset by a 1.4% increase in net revenue per pound. Broadly speaking, on a year-over-year basis, we continue to experience greatest pressure in our food service channels, both in the U.S. and abroad, while our retail channels are showing more encouraging signs of improvement, most notably in international.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Overall, the decrease in volume of products sold for the second quarter of 2026 was primarily driven by lower sales of burger and chicken products to certain QSR customers in the international food service channel and by weak category demand and reduced points of distribution in our U.S. retail and food service channels. Net revenue per pound increased on a year-over-year basis, primarily driven by changes in product sales mix and favorable changes in foreign currency exchange rates, partially offset by higher trade discounts. Taking a closer look by channel, in our U.S. retail channel, net revenues decreased 9.9% to $29.6 million in the second quarter of 2026, compared to $32.9 million in the year-ago period. Total volume of products sold in U.S. retail declined 5.7% on a year-over-year basis, primarily reflecting persistent category softness and reduced points of distribution within certain channels.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

With respect to the latter, some of the distribution losses that impacted our Q2 results were associated with packaging transitions on certain items and are therefore expected to be transitory. However, challenges related to general category softness remain. In terms of price realization, net revenue per pound in U.S. retail was down 4.5% year-over-year, primarily driven by higher trade discounts and lower price realization on certain items, partially offset by changes in product sales mix. Turning to U.S. food service, net revenues in our U.S. food service channel decreased 27.6% to $8 million in the second quarter of 2026, compared to $11.1 million in the year-ago period. The decrease was primarily driven by a 27.4% decrease in volume of products sold, with net revenue per pound declining slightly year-over-year.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Volume of products sold in our U.S. food service channel continued to be negatively impacted by distribution losses, primarily among smaller independent operators and general category softness. Net price realization in U.S. food service was slightly unfavorable on a year-over-year basis, as higher trade discounts and lower price realization on certain items more than offset favorable changes in product sales mix. Moving on to international. Our international retail channel net revenues increased 16.5% to $18.5 million in the second quarter of 2026, compared to $15.9 million in the year-ago period. The increase in international retail channel net revenues was primarily driven by an 8.2% increase in volume of products sold and a 7.7% increase in net revenue per pound.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Volume of products sold in this channel continues to benefit from higher sales of burger and chicken products in European markets, as well as increased sales of ground beef products in Canada. The increase in net revenue per pound in international retail primarily reflects price increases in certain geographies and favorable changes in foreign currency exchange rates, partially offset by higher trade discounts. Finally, in our international food service channel, net revenues decreased 16% to $12.7 million in the second quarter of 2026, compared to $15.1 million in the year-ago period. The decrease in international food service channel net revenues was primarily driven by a 20.4% decrease in volume of products sold, partially offset by a 5.5% increase in net revenue per pound.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

The decrease in volume of products sold in our international food service channel mainly reflects lower sales of burger and chicken products to certain QSR customers in Europe and Canada, while the increase in net revenue per pound was mainly attributable to favorable changes in foreign currency exchange rates and lower trade discounts. Now turning to gross profit. Gross profit in the second quarter of 2026 was $5.9 million, or gross margin of 8.5%, compared to gross profit of $7.9 million, or gross margin of 10.6%, in the year-ago period. Gross profit and gross margin in the second quarter of 2026 included $1.6 million in expenses related to the cessation of our operational activities in China, compared to $1.7 million in the year-ago period.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Additionally, gross profit and gross margin in the second quarter of 2026 were negatively impacted by higher materials costs and higher manufacturing expenses, including depreciation, partially offset by lower inventory provision. The increase in manufacturing expenses in part reflected the impact from year-over-year volume declines, which has a negative impact on fixed cost absorption. Operating expenses were $36.7 million in the second quarter of 2026, compared to $45.4 million in the year-ago period.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Operating expenses in the second quarter of 2026 included $4.7 million in incremental share-based compensation expense related to our convertible debt exchange, $0.5 million in certain non-routine SG&A expenses, $0.4 million in amortization of costs related to a partial lease termination of a portion of our campus headquarters, and a credit of $11 million reflecting the settlement of arbitration proceedings related to a previously disclosed contractual dispute with a former co-manufacturer, compared to an expense of $2.5 million in the year-ago period. Loss from operations was therefore $30.8 million in the second quarter of 2026 compared to $37.5 million in the year-ago period.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Below the line, total other income net was $47.2 million in the second quarter of 2026 compared to $5.7 million in the year-ago period, with a significant increase primarily reflecting a non-cash gain on debt extinguishment of $57.7 million, partially offset by a reduction in other income net, increased interest expense related to our delayed draw term loan facility, and remeasurement loss of derivative liability stemming from the 2030 Notes' embedded derivatives. Net income was therefore $16.4 million in the second quarter of 2026, or $0.03 per common basic share, compared to net loss of $31.8 million in the year-ago period, or -$0.42 per common share in the year-ago period. Adjusted EBITDA was a loss of $27.7 million or -40.2% of net revenues in the second quarter of 2026, compared to an adjusted EBITDA loss of $24.7 million or -33% of net revenues in the year-ago period.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Turning briefly to our balance sheet and cash flow highlights. Our cash and cash equivalents balance, including restricted cash, was $186.1 million, and total outstanding carrying value of debt, net of debt discount, was $323.8 million as of June 27th, 2026, which included the total undiscounted future cash flows of the new 2030 Notes recorded at the completion of our convertible debt exchange. Net cash used in operating activities was $23.2 million in the six months ended June 27th, 2026, compared to $58 million in the year-ago period. Capital expenditures totaled $4 million in the six months ended June 27th, 2026, compared to $6.4 million in the year-ago period.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Net cash used in financing activities was $6.6 million in the six months ended June 27th, 2026, compared to net cash provided by financing activities of $32.3 million in the year-ago period, which included a partial draw on our delayed draw term loan. As Ethan mentioned, we were pleased that our quarterly cash consumption, excluding financing activities, continues to show meaningful improvement versus year-ago levels, which reflects in part savings related to our transformation program as well as effective inventory management. Finally, I'll touch briefly on our outlook. As in recent periods, we are continuing to provide only limited net revenue guidance given ongoing levels of uncertainty and volatility within our operating environment, which we believe may continue to have unforeseen impacts on our actual realized results.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

To this end, in the third quarter of 2026, we expect net revenues to be in the range of approximately $60 million to $65 million. With that, I'll turn the call over to the operator to open it up for your questions.

Operator

Ladies and gentlemen, at this time, we'll begin the question-and-answer session. To ask a question, you may press star and then one using your touchtone telephones. If you are using a speakerphone, we do ask that you please pick up the handset before pressing the keys to ensure the best sound quality. To withdraw your questions, you may press star and two. Again, that is star and then one to join the question queue. We'll pause momentarily to assemble the roster. Our first question today comes from Ben Theurer from Barclays. Please go ahead with your question.

Ben Theurer
Ben Theurer
Analyst at Barclays

Hey, good afternoon Ethan, Lubi. Thanks for taking my question and all the details so far on the call. A couple of things I just wanted to get through real quick. As you look at the performance in the different regions, you've clearly highlighted Europe and Canada as good opportunities, but still drag in others. First of all, as you look at the different consumer dynamics or demand dynamics in these regions, can you help us maybe understand a little bit better why there is such a difference in terms of just acceptance or just consumer willingness to engage with the products in, for example, Europe versus the U.S.? That would be my first question.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Great. Thank you, it's good to hear from you. I think what we're seeing, we're beginning to see this in a sustained level, in Europe, we do not face the same very significant campaigns and misinformation that we do here in the U.S. from the incumbent industry. They are organized there, they do have some activities going on, but it did not gather the same momentum. That's one backdrop. The second is that the consumer there, I think, links much more readily their food consumption choices to climate. Climate there is obviously being taken more seriously than it is here in the U.S. from a policy and consumer behavior perspective. Of course, they're experiencing some of the most difficult summers they've had in a long time. I think those types of things are working in our favor in the markets.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

You look at different pockets. Germany is very strong. U.K. is pretty good. Netherlands, where we are, also has some strength to it. We've also just appointed, I think, a long-time partner of mine, and of ours, to run Europe for us in Adriaan, and we're very excited about that. You'll see us continue to invest in Europe. The dynamics there are such that the kind of negative narrative that was framed here by the meat industry is just not present there in the same strength. I think that's the overall reason.

Ben Theurer
Ben Theurer
Analyst at Barclays

Okay. More like of a corporate actions. Just a couple of days ago, you made a couple of changes, hiring or bringing on a COO with Brijesh Krishnaswamy. You're returning to the board. Could you talk a little bit more about what the thought process behind that is, behind those changes?

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Yeah. I think John Boken has done a fantastic job for us as an Interim Transformation Officer and serving in that capacity. The goal always was to bring on someone full time. He's been very patient working with us and allowing us the time to pick the right candidate. One of the things that I love about Brijesh is his background. If you look closely at his career, is both in the U.S. and in Europe, specifically in the Netherlands. As you think about what I'm trying to accomplish in terms of growing both in Europe and stabilizing here in the U.S., he's a really good fit for that, as well as just having broad commercial experience and operating experience. We're happy that we got the right candidate in the door and looking forward to him starting.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Myself going back to the board, I'm happy to do it. It's really more about the operating work that I'm doing and making sure we get through this turnaround, which I feel quite good about, and particularly as we go into some of these adjacent categories. I tried to frame on introductory comments. I really do think about this in terms of three pillars. The first being let's stabilize the core business, and we've got a lot of work to do in the U.S. We're getting a lot of help from Canada and from Europe. Second, let's take this technology, the science, the brand into adjacent categories that are not as challenged as the core categories we're in. When we do that, we have the ability to go into those markets with a lot of experience and with a lot of expertise.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

I believe great products that differentiate quickly and raise the bar in each of the categories we're in. From an innovation perspective, we have a lot of dry powder left, and I think you'll see us use that to create some momentum in each of the categories we go into. Immerse was just the first, there'll be others to follow.

Ben Theurer
Ben Theurer
Analyst at Barclays

Okay, perfect. Thank you very much. I'll pass it on.

Operator

Once again, if you would like to ask a question, please press star and one. Our next question comes from Thomas Palmer from JPMorgan. Please go ahead with your question.

Thomas Palmer
Thomas Palmer
Analyst at JPMorgan

Good afternoon. Thanks for the question, guys. Maybe just starting off on the cost environment. I appreciate how dynamic it is, maybe at a high level, anything that you're seeing, be it with freight or other areas that have been more volatile, just as we sit today, and kind of maybe actions to mitigate it if there are some.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Sure. No, that's a great question. Thanks. When I look at the unit economics, we're obviously focused on continuing to drive down good direct materials and direct labor and all these things. The main solve here is throughput, right? We continue to try to optimize our facilities, but the best and ultimate solve here is to just get more volume through those facilities. When you have a reduction in volume to the extent we did, about 9.5% or so, you're going to see downward pressure because of the lower cost absorption, overhead absorption. That I think is the main focus. We also have a lot of initiatives going on, whether they're RFPs. One of the ones that I'm most excited about is continuous line that we've stood up in Columbia, Missouri. We're still testing that. We're still spinning it up.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

As that comes into focus and starts to really contribute to our volume, that's going to pay, I think, a really nice dividend in terms of conversion. I'll turn it over to Lubi if he has any other comments.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Yeah. No, I think you largely covered it there, Ethan. We are seeing within our total basket of cost of goods sold, some pockets of inflation. There's other key inputs where we do expect to see some savings on a year-over-year basis. I would say, just from the general level of ingredients, cost inflation, we don't expect that to be necessarily overly excessive this year. What Ethan mentioned about where we're really looking for efficiencies, right, in terms of the throughput and investments in automation, et cetera, that's really where we would expect over time to continue to drive additional costs out of our production processes. In terms of logistics, obviously, the transportation has been a relatively volatile space the last several months. I think we've offset a lot of that with some really good work that we've done on the warehousing side.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

We've significantly consolidated our warehousing footprint. We're actually doing pretty well in terms of our logistics costs within cost of goods sold. I think clearly, still more work to be done from a cost of production perspective. I think, just given some of the volatility that we've seen in the broader environment, the team has done a pretty solid job.

Thomas Palmer
Thomas Palmer
Analyst at JPMorgan

Great. Thanks for such a thorough answer.

Lubi Kutua
Lubi Kutua
CFO and Treasurer at Beyond Meat

Sure.

Operator

With that, ladies and gentlemen, we'll be concluding today's question and answer session. I'd like to turn the floor back over to management for any closing remarks.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Just thanks for the time. Thanks for the continued interest. We're, I think, showing this quarter sequential progress across the metrics that matter at the top line, going from 19% to 15%, now down to 8%, and we hope to cross over that threshold as soon as we possibly can. Also just continuing to drive cash use down. If you look at the six months ending June 27th, we're less than half of the cash consumed vis-a-vis a year ago period. We've got work to do. We have a lot of margin work to do and things of that nature, and to get the top line back growing again.

Ethan Brown
Ethan Brown
Founder, President, and CEO at Beyond Meat

Overall, I was pleased with the direction that we saw this quarter, and I think we're excited to demonstrate what we can do in some of these adjacent categories, even as we continue to work to stabilize our core. We'll talk to you in a few months. Thanks.

Operator

With that, ladies and gentlemen, we'll be concluding today's conference call and presentation. We do thank you for joining. You may now disconnect your lines.

Executives
    • Paul Sheppard
      Paul Sheppard
      VP of Financial Planning and Analysis and Investor Relations
    • Ethan Brown
      Ethan Brown
      Founder, President, and CEO
    • Lubi Kutua
      Lubi Kutua
      CFO and Treasurer
Analysts
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