Soured
HelloFresh was looking a little past its “sell-by” date this week: after the company cut its profit guidance for the year, investors dumped shares, which saw the stock price fall ~14% on Thursday. The move leaves the company’s stock down 52% since mid-September, wiping some $3.4 billion from the meal maker's value.
While it’s unknown exactly what moved HelloFresh to issue the profit warning — just 3 weeks after it had restated financial targets on a quarterly earnings call in October — the German company pointed to weaker-than-expected sales growth and rising costs in North America, where 56% of its active customers are based.
Founded in Berlin in 2011, when co-founders personally hand-packed the early pre-prepped meals, HelloFresh was one of the first leaders in the “meal-kit delivery” industry, quickly expanding into the US and eventually becoming the most popular meal-kit service in the world.
On a list of “businesses that boomed during the pandemic”, HelloFresh wasn’t quite on Zoom's level... but it wasn’t far off. Although millions turned to the convenience of regular food deliveries during lockdown, holding onto subscribers has proved difficult in 2023, with its customer count falling in each of the last 4 quarters — shedding 440,000 HelloFreshers in Q3.
