Tyson Foods' Q2 Earnings Surge 48% on Chicken Sales Growth

Tyson Foods, a prominent meat processing company, reported that its second-quarter earnings for the 2025 fiscal year surpassed market expectations. This achievement was largely driven by the robust growth in chicken sales, which compensated for the continuous losses incurred by its beef business. The company's revenue for the quarter stood at $13.07 billion, remaining flat compared to the same period last year and slightly below market expectations. However, the earnings per share reached $0.92, marking a 48% increase from the previous year and exceeding the average analyst estimate of $0.80. These figures exclude a $3.43 billion charge related to legal contingencies and other special items.

The adjusted operating profit for the quarter increased by nearly 27% to $5.15 billion, primarily due to the strong performance of the chicken sales. Tyson's pork and prepared foods businesses also saw modest profit growth. The company, known for brands like Jimmy Dean sausages and Hillshire Farm hams, has been leveraging the high profitability of its chicken business to mitigate the cost pressures caused by severe cattle shortages. This segment has benefited from cheaper poultry feed supplies and robust consumer demand.

Tyson has also taken steps to improve its operational efficiency by closing less productive factories and resuming the use of certain antibiotics in poultry to enhance performance. However, there are concerns that the boom in the chicken business may be nearing its end. Suppliers are increasing production, which could intensify market competition. Additionally, the price of corn, a key feed ingredient, has risen from its low point last year. Meanwhile, potential tariffs in China and a slowing U.S. economy could impact American chicken exports.

The beef business, Tyson's largest segment, reported a loss of $1.49 billion for the quarter, excluding special items, which was worse than analyst expectations. This loss was due to the company's inability to pass on the soaring costs of cattle to consumers. This marks the sixth consecutive quarter of losses for this segment. In contrast, the chicken business reported an adjusted operating profit of $3.12 billion, exceeding analyst expectations.

The company also noted that free cash flow for the first six months of the fiscal year was lower than the same period last year. The challenging environment in the beef sector, coupled with the potential headwinds in the chicken business, presents a complex landscape for Tyson Foods as it navigates the remainder of the fiscal year.