(Reuters) -Tyson Foods on Monday forecast annual revenue largely above analysts’ estimates, betting on demand for chicken products to offset weaknesses in its beef business.
Persistent inflation and uncertainty arising from the Trump administration’s trade policies have led to more consumers, especially those from lower-income households, opting to cook at home instead of dining out, benefiting packaged food makers such as Tyson.
Sales for the company’s chicken and processed meat products remained resilient on demand for the relatively inexpensive source of protein as prices fell due to oversupply in the market.
However, cattle herd sizes in the U.S. dwindled to the smallest level in nearly 75 years after a years-long drought dried up pastures used for grazing, forcing meat companies including Tyson to pay more to buy cattle to slaughter.
Tight supplies also drove beef prices to record highs this year in a blow to consumers.
CEO Donnie King said in August that ranchers likely started the process of rebuilding the cattle herd by keeping female cows, known as heifers, on farms for breeding. Supplies will remain tight because it takes roughly two years to raise full-grown cattle.
U.S. President Donald Trump last month said U.S. beef prices were too high and that cattle ranchers had to lower prices. The country could quadruple low-tariff imports of beef from Argentina to help bring down U.S. prices, a White House official said.
Springdale, Arkansas-based Tyson Foods expects fiscal 2026 revenue to rise between 2% and 4%, above analysts’ estimate of 2.3% growth, according to data compiled by LSEG.
The company’s net sales rose 2.2% to $13.86 billion in the fourth quarter ended September 27, below analysts’ average estimate of $13.97 billion.
In Tyson’s chicken unit, quarterly sales volumes rose 3.8%. Volumes in Tyson’s beef business fell 8.4%, but sales grew 4.3% as prices jumped 17%.
(Reporting by Neil J Kanatt in Bengaluru, and Karl Plume and Tom Polansek in Chicago; Editing by Maju Samuel)
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