Tyson Foods (TSN.US) surpasses Q1 expectations, robust recovery in chicken operations fuels profit growth.

Tyson Foods (TSN.US) reported a strong quarter, exceeding analyst expectations, driven by robust performance in its chicken business, which successfully offset losses in its beef business. As a result, the company raised its profit outlook for 2025. The company reported that its first-quarter 2025 sales reached $13.623 billion, up 2.3% year-on-year; net profit reached $359 million, up 235% from $107 million in the same period last year. Adjusted EPS was $1.14, up 65% year-on-year, topping analysts' average estimate of $0.91, marking Tyson Foods' best quarter in more than two years. Segment-wise, chicken business sales were $4.065 billion, slightly higher than the $4.033 billion in the same period last year. Thanks to the decline in feed prices such as corn and soybeans and increased consumer demand, Tyson's poultry business saw its adjusted operating profit almost double to $368 million, topping analysts' expectations. In contrast, the beef business performed weakly, with first-quarter sales of $5.335 billion, up from $5.023 billion in the same period last year, but operating losses reached $32 million. This was mainly due to a shortage of beef supply in the US and soaring slaughter costs. In addition, Tyson Foods' GAAP operating profit was $580 million, up 151% year-on-year; adjusted operating profit was $659 million, up 60% year-on-year. Free cash flow (non-GAAP) was $760 million, down $1.86 billion year-on-year; operating cash flow was $1.031 billion, down $2.69 billion year-on-year. Based on its strong performance, Tyson Foods raised its adjusted revenue outlook for 2025 by $100 million to between $1.9 billion and $2.3 billion. Donnie King, the company's CEO, said in a statement: "The company started the 2025 fiscal year strongly, especially with the outstanding performance of the chicken business." Overall, Tyson Foods' strong performance this quarter was mainly driven by the recovery of its chicken business, despite challenges in its beef business, with overall profit growth significant. The company is confident about the future and raising its profit outlook reflects its optimistic outlook. With the continued growth in chicken demand and easing cost pressures, Tyson Foods is expected to maintain a strong growth momentum in 2025. As of the time of writing, Tyson Foods rose more than 6% before the market opened, trading at $60.38.