TTCF - Tattooed Chef stock sinks 23% after hours on slashed outlook amid inflationary pressures

Tattooed Chef ( NASDAQ: TTCF ) stock sank ~23% after hours on Thursday as the plant-based food company slashed its FY outlook as consumers continue to cut back on spending amid high inflation.

The firm expects 2022 revenue of $235M-$245M, well below consensus estimate of $281.20M. Its prior guidance was $280M-$285M.

2022 gross margin is projected to be 0-3% vs. earlier forecast of 8-10%, driven by continued cost inflationary pressures and impacts from the multi-vendor mailer reclassification from operating costs to contra revenue as well as lower revenue.

Tattooed Chef ( TTCF ) reported preliminary Q3 net revenue of $54.1M (-6.7% Y/Y), widely missing consensus estimate of $72.96M. Preliminary net loss was $38.3M vs. $8.3M in Q3 2021.

The company also announced new initiatives to reduce cost of goods sold and operating expenses. Through these initiatives, the firm expects to realize ~$30M of cost savings over the next 12 months.

The initiatives include lower marketing expenses, automation-derived savings of ~$6M through reduction in direct labor, ~$2M savings associated with in-house cold storage facilities, and fewer promotional programs.

"We believe the initiatives will position us to achieve positive EBITDA and cash flow by or around mid-year 2024," said CEO Sam Galletti.

Tattooed Chef ( TTCF ) also said it filed with the U.S. SEC to extend the deadline for form 10-Q for Q3. It expects to file the report no later than Nov. 14.

Shares of Tattooed Chef ( TTCF ) declined ~72% YTD.

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