By Patrick Thomas
Soaring cattle prices continue to weigh on Tyson Foods' bottom line, as the meatpacking giant tries to offset rising livestock costs through higher profits from its chicken business.
A shortage of cattle on U.S. pastures is driving up livestock prices, according to meat-industry officials. The tighter supply, which is expected to last at least two more years, is driving up costs for meatpackers like Tyson and rival JBS.
In the three months ended March 28, the company reported a profit of $260 million, up from $7 million the same period a year earlier. On an adjusted basis, Tyson earned 87 cents per share, better than the 78 cents that Wall Street analysts expected, according to FactSet.
Arkansas-based Tyson posted a $240 million loss in its beef division for its fiscal second quarter, compared with a $222 million loss in the same period last year. The company's beef sales price rose by an average of almost 12% year over year, while sales volumes fell 13%.
Tyson--which processes roughly one of every five pounds of chicken, beef and pork sold in the U.S.--said its quarterly sales rose about 4% from the same period a year earlier to $13.65 billion, which was higher than analysts predicted.
The company's profits were driven by its chicken business, which is benefiting from strong demand for nuggets and wings as beef prices hit record levels. Chicken prices have been stable for the past year, while cheap livestock feed--the top expense when raising chickens--is cheaper, benefiting poultry companies.
For its 2026 fiscal year, Tyson slightly raised its adjusted operating-income forecast to between $2.2 billion and $2.4 billion from its previous range of $2.1 billion to $2.3 billion because of higher profits from its poultry business.
Write to Patrick Thomas at patrick.thomas@wsj.com
(END) Dow Jones Newswires
05-04-26 0819ET
