Tyson Foods Reports Unexpected Loss as Inflation Impacts Meat Sales

Tyson Foods (NYSE:TSN) reported an unexpected second-quarter loss on Monday, causing its stock to plummet 7.5% in premarket trades. The meat producer announced a loss of $49 million, or 28 cents a share, compared to net income of $1.16 billion, or $2.28 a share, in the year-ago quarter. The company's adjusted loss was 4 cents a share, significantly below the Wall Street estimate for net income of 79 cents a share.

Second-quarter revenue saw a marginal increase to $13.13 billion from $13.12 billion but fell short of analyst forecasts of $13.62 billion. Tyson Foods has also lowered its outlook for fiscal 2023 revenue to between $53 billion and $54 billion, which is below the Wall Street estimate.

The largest meat company in the US has revised its outlook for meat sales this year due to consumers switching to cheaper foods amid inflation. Tyson now estimates full-year sales to range between $53 billion and $54 billion, down from earlier projections of $55 billion to $57 billion. This adjustment comes as consumers have been purchasing fewer steaks and burgers in an effort to reduce food costs.

In addition to consumers' changing buying habits, drought-hit cattle ranchers have been reducing their herds, pushing cattle prices to record highs.

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