Tyson Foods' FY2025 10-K: Beef Losses Drive 40% Profit Decline

As a leading force in the global food industry, Tyson Foods' financial performance provides a valuable window into the dynamics of protein production and consumer markets. The company's recently released annual 10-K report for the fiscal year ending September 27, 2025, reveals a company navigating significant crosscurrents. Let's delve into the income statement to understand the story behind the numbers. You can find the full report on the SEC's website here.

While total sales saw a modest increase of 2.1% to $54.44 billion, Tyson's profitability took a significant hit. Net income attributable to the company fell sharply to $474 million from $800 million in the prior year, a decline of over 40%.

A Divide in Performance

The drop in profit is not a company-wide issue but is concentrated in specific business segments. Tyson's results show a stark contrast between its poultry and prepared foods divisions and its red meat operations:

• Beef: This segment was the primary drag on earnings, reporting an operating loss of $1.14 billion, a substantial increase from the $381 million loss in fiscal 2024.
• Pork: The Pork segment also saw its operating loss widen, reaching $199 million compared to a $40 million loss last year.
• Chicken: In contrast, the Chicken segment delivered a strong performance, with operating income climbing to $1.43 billion from $988 million in 2024.
• Prepared Foods: This division, which includes value-added products like deli meats and frozen meals, posted a solid operating income of $898 million.

The severe losses in the red meat segments highlight intense market pressures. The filing specifically attributes the Beef segment's struggles to a massive $1.84 billion increase in cattle costs. This surge in raw material expenses squeezed margins, making profitability a challenge despite higher sales prices.

Visualizing the Financial Flow

The following flow diagram illustrates how the company's revenue is allocated across its various costs and expenses to arrive at its net income for the 2025 fiscal year.

You might notice an unallocated "Intersegment Sales" item in the diagram. This represents sales between Tyson's own divisions—for example, the Pork segment selling raw materials to the Prepared Foods segment. This amount is subtracted from the total to avoid double-counting revenue at the consolidated level, giving a true picture of sales to external customers.

Goodwill Impairment Signals a Tougher Outlook

Compounding the challenges in the Beef segment was a $343 million goodwill impairment charge. Goodwill is an intangible asset that reflects the premium a company pays when acquiring another business. An impairment charge is a non-cash expense that a company records when the future earning potential of that acquired business is deemed to have declined. This write-down signals that Tyson has lowered its long-term profitability expectations for its Beef operations, a direct result of the difficult market conditions.

In response to these pressures, Tyson is taking steps to optimize its operations. The company recorded $45 million in restructuring charges and $17 million in plant closure costs in fiscal 2025 as part of its ongoing efficiency initiatives.

Looking Ahead

Tyson Foods is navigating a complex environment characterized by commodity price volatility. While its Chicken and Prepared Foods segments show resilience and strength, severe headwinds in the Beef and Pork markets have heavily impacted the company's bottom line. The focus on restructuring is a crucial step, but Tyson's performance in the coming year will largely depend on its ability to manage these turbulent red meat markets and adapt to persistent cost pressures.