Meat company Tyson Foods (NYSE:TSN) missed Wall Street’s revenue expectations in Q3 CY2025 as sales rose 2.2% year on year to $13.86 billion. Its non-GAAP profit of $1.15 per share was 37.8% above analysts’ consensus estimates.
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Tyson Foods (TSN) Q3 CY2025 Highlights:
- Revenue: $13.86 billion vs analyst estimates of $14.01 billion (2.2% year-on-year growth, 1.1% miss)
- Adjusted EPS: $1.15 vs analyst estimates of $0.83 (37.8% beat)
- Adjusted EBITDA: -$42 million vs analyst estimates of $829.1 million (-0.3% margin, significant miss)
- Operating Margin: -1%, down from 3.9% in the same quarter last year
- Sales Volumes fell 1.6% year on year (0.5% in the same quarter last year)
- Market Capitalization: $19.03 billion
StockStory’s Take
Tyson Foods’ third quarter results were met with a positive market reaction, despite missing Wall Street’s revenue expectations. Management attributed outperformance in non-GAAP earnings to continued momentum in the Chicken segment and disciplined cost management across operations. CEO Donnie King emphasized improved operational execution and innovation in value-added chicken products, while also acknowledging challenges in the Beef segment due to tight cattle supplies and higher input costs. The company’s Prepared Foods unit also contributed to growth, with performance improvements in production facilities and a steady innovation pipeline.
Looking to the remainder of the year, Tyson’s outlook centers on leveraging its diversified protein portfolio and operational efficiency initiatives. Management sees chicken as the primary beneficiary of evolving consumer preferences and high beef prices, with ongoing investments in innovation and marketing to drive category expansion. CFO Curt Calaway highlighted the company’s strong balance sheet and disciplined capital allocation, while Chief Operating Officer Devin Cole pointed to a continued focus on operational excellence, particularly in Prepared Foods and Pork. Management cautioned that beef headwinds will persist due to limited cattle supply, but expects further gains in chicken and prepared foods to offset these pressures.
Key Insights from Management’s Remarks
Management cited operational improvements in chicken, innovation in prepared foods, and a diversified protein strategy as key drivers of the quarter’s performance. Ongoing beef market challenges and disciplined cost controls also shaped results.
- Chicken operational turnaround: The Chicken segment saw continued improvement, with management crediting higher volumes, better execution throughout the supply chain, and lower feed costs. CEO Donnie King noted, “We’re now starting to see the fruit of our labor,” referencing multi-year efforts to address genetics and capacity issues.
- Prepared Foods innovation pipeline: The company’s Prepared Foods business delivered growth through targeted innovation and improved operational discipline. New product launches, such as high-protein chicken cuts and Hillshire Farm’s entry into the freezer section, are designed to meet changing consumer preferences for convenience and nutrition.
- Beef faces persistent headwinds: Tight cattle supplies, regional herd rebuilding, and external challenges like the New World screwworm in Mexico continued to pressure the Beef segment, with higher costs outpacing gains from value-added offerings. Management remains focused on controlling costs and enhancing product mix.
- Market share and branded growth: Tyson’s branded retail products outperformed the broader market, growing volume in categories such as frozen value-added chicken and lunch meats. The company now reaches nearly 72% of U.S. households, with strong traction among younger consumers.
- COO appointment and operational focus: Devin Cole’s appointment as Chief Operating Officer marks a renewed emphasis on streamlining operations and reducing complexity. Cole outlined a commitment to “challenging the status quo” and driving efficiencies across all business units.
Drivers of Future Performance
Tyson Foods’ forward guidance places emphasis on chicken category strength, ongoing operational discipline, and navigating ongoing beef supply constraints.
- Chicken as growth engine: Management expects chicken to drive revenue and margin expansion, supported by stable grain prices, improved operational execution, and continued demand for affordable protein. CEO Donnie King stated that value-added and branded chicken offerings provide insulation from commodity market volatility.
- Beef segment uncertainty: Persistent cattle supply shortages and regional herd rebuilding are expected to weigh on beef profitability for the foreseeable future. Management highlighted potential disruptions from factors such as Mexico border closures and disease outbreaks, making cost control and product mix optimization critical.
- Prepared Foods and innovation: The Prepared Foods segment is positioned for further gains through operational efficiencies and a robust innovation pipeline. New product introductions and targeted marketing are intended to sustain volume and share gains, particularly as consumer preferences shift toward convenience and high-protein options.
Catalysts in Upcoming Quarters
In upcoming quarters, key catalysts to monitor include (1) sustained momentum in the Chicken segment, especially through value-added and branded products, (2) the company’s ability to offset beef segment headwinds with operational improvements and product mix, and (3) continued growth in retail market share and household penetration for branded products. Execution on innovation and cost control will remain key signposts for Tyson’s performance trajectory.
Tyson Foods currently trades at $54.60, up from $52.67 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members).
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