Tyson CEO says company ‘got hit in the mouth’ after missing first-quarter estimates
Julia Johnson
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Tyson Foods missed projected Wall Street earnings for the first quarter of 2023.
President and CEO Donnie King admitted on a Monday earnings call that the company had been “hit in the mouth in Q1.”
The reason it fell short of earnings expectations was “driven by weaker results in chicken, pork, and beef.”
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“And our tray pack or fresh chicken business didn’t materialize as we had expected,” he explained. “And so, you know, we created our own issue with that because of what happened in the market.”
However, he said, “we still have tremendous opportunity and upside as we execute this business.”
Several factors led to incorrect projections regarding the meat market in the first quarter.
“With higher cattle prices, we expected overall harvest to slow down. But that hasn’t happened yet,” King explained of miscalculations regarding beef on the call.
On chicken, “a few different things didn’t go as planned.”
“Demand didn’t appear in the parts of the market where we had expected,” he told analysts. “We had to move things around, and we experienced higher cost, a lower price environment, and knock-on effects from a network standpoint.”
Notably, avian flu has affected poultry across the country. As of Feb. 1, the CDC reported 58,200,536 poultry birds had been affected.
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Tyson’s shares reportedly fell 4.61% to $61.08 on Monday.
According to King, “The only thing that went awry was the fact that the demand didn’t materialize in the place at retail in which we thought it would.”