Chicken sales are booming as people move away from high-priced beef, Tyson Foods says

By James Rogers

Chicken sales reached a three-year high, and demand is expected to remain strong in 2026 while beef pressures continue

Meat producer Tyson Foods reported fourth-quarter results before market open.

With beef prices soaring, more people are choosing chicken, according to meat producer Tyson Foods Inc.

While the brouhaha over President Donald Trump's trade wars may be dying down, there is still a degree of uncertainty in the U.S. economy. In particular, this is influencing how less affluent consumers spend their money.

Similar to fast-food giants McDonald's Corp. (MCD) last week and Restaurant Brands Inc. (QSR) the week before, Tyson Foods (TSN) highlighted this trend in its latest quarterly results, released Monday. "As we think about the consumer, we definitely are seeing a continued divergence in incomes with higher incomes continuing to drive growth and others reallocating some of their nonfood dollars to food categories," Kristina Lambert, Tyson Foods' chief growth officer, said during a conference call to discuss the fourth-quarter results.

Read: McDonald's push to make meals affordable is working as sales growth tops expectations, again.

Protein, in particular, remains a priority for consumers, even as the food industry wrestles with soaring beef prices. "Beef, pork and chicken are clear favorites, with consumers viewing protein as an essential purchase and continuing to buy meat," Tyson Foods Chief Executive Donnie King said during the call.

Still, Tyson Foods is feeling the impact of the cattle shortage that sent the price of beef climbing. During the fiscal fourth quarter through Sept. 27, the beef business reported an adjusted operating loss of $94 million, after a loss of $71 million in the prior year's quarter. King pointed to cattle supplies at record lows due to drought, herd rebuilding and the impact of the New World screwworm in Mexico.

"These factors created market headwinds during the quarter," he added, noting that cattle supplies are expected to remain tight into 2026.

But chicken is a different story. Tyson Foods' chicken business reported adjusted operating income of $457 million, up from $356 million in the same period last year. This was driven by increasing demand and decreasing costs to feed the chickens, as chicken sales reached the highest level in three years.

And that demand is expected to remain strong, as consumers seek out an affordable alternative to beef. "Chicken is likely to benefit most from changing consumer preferences both at retail and in food service," King said. "2026 presents further opportunities for our chicken business -chicken is an affordable, high-quality protein."

The company's outlook also provided a stark contrast between its beef and chicken businesses. Tyson Foods expects an adjusted operating loss in its beef business between $400 million and $600 million in fiscal 2026 and noted that the U.S. Department of Agriculture projected that domestic beef production will decrease approximately 2% in fiscal 2026 compared with fiscal 2025.

However, Tyson Foods expects adjusted operating income in its chicken business of $1.25 billion to $1.5 billion, and pointed to the USDA's projection that chicken production will increase approximately 1% year over year.

The Springdale, Ark.-based company also expects that its prepared-foods business, which includes Hillshire Farm products, will generate adjusted operating income of $950 million to $1.05 billion in 2026.

Overall, Tyson Foods expects sales to be up 2% to 4% in fiscal 2026 as compared with fiscal 2025. Analysts surveyed by FactSet were looking for sales growth of about 2.5%, on average.

Investors were cheered by the company's better-than-expected sales outlook. Tyson Foods' stock rose 1.4% toward a one-month high in midday trading, but pared earlier intraday gains of as much as 5.7%.

The company's fourth-quarter profit was $47 million, or 13 cents a share, down from $357 million, or $1 a share, in the prior year's quarter.

Adjusted earnings, which exclude nonrecurring items, were $1.15 a share, beating the FactSet consensus estimate of 84 cents a share.

Fourth-quarter sales rose to $13.86 billion from $13.57 billion but missed the FactSet consensus estimate of $14.11 billion.

Beef sales rose to $5.49 billion from $5.26 billion in the same period last year, lifted by prices that rose 17% while volume declined 8.4%. Chicken sales rose to $4.41 billion from $4.25 billion as prices rose 0.1% and volume increased 3.7%. Sales of prepared foods rose to $2.55 billion from $2.47 billion, with the company noting that prices rose 4.7% and volume declined 1.7%.

Chicken was the only food segment that saw an increase in volume.

The meatpacking industry has attracted the attention of the Trump administration, which wants to tackle beef prices. Last week, Trump directed the Justice Department to launch an investigation into the largest meatpacking companies in the U.S. for potential collusion to push up the price of beef. Tyson Foods did not mention the probe during the company's conference call.

However, Tyson Foods was asked whether it is seeing any impact from delays and disruptions to Supplemental Nutrition Assistance Program, or SNAP, benefit payouts as a result of the government shutdown.

Lambert described the situation as "evolving" and said that Tyson Foods is closely monitoring it. She said there has been some shift in consumer-spending patterns, as what people are spending money on is "changing from nonfood to more food categories."

-James Rogers

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11-10-25 1253ET