Tyson Foods (TSN) Q1 2026 earnings summary

Executive summary

• Q1 sales reached $14.3 billion, up 6.2% year-over-year excluding legal accruals, with strong demand for protein and operational execution; reported sales growth was 5.1%–6.2% depending on legal adjustments.

• Chicken and Prepared Foods segments delivered strong or improved results, with Chicken posting its fifth consecutive quarter of volume gains and Prepared Foods showing revenue and profit growth.

• Beef segment faced significant margin pressure and losses due to tight cattle supply and higher costs, leading to facility closures and operational right-sizing.

• Legal contingency accruals ($150–$155 million) and restructuring charges ($115–$140 million) impacted reported results.

• Liquidity stood at $4.5 billion, with total debt reduced by $468 million during the quarter and continued deleveraging.

Financial highlights

• Adjusted operating income for Q1 was $572–$811 million, down 12–13% year-over-year; GAAP operating income was $302 million, down 48%.

• Adjusted EPS was $0.97, down 15% year-over-year; GAAP EPS was $0.24, down 76%.

• Free cash flow was $690 million, down from $760 million in the prior year; operating cash flow reached $942 million.

• Net leverage improved to 2.0x, with $4.5 billion in liquidity and gross debt reduced by $1.4 billion over 12 months.

• Gross profit margin was 5.6%, operating margin 2.1%, and net margin 0.6% for the quarter.

Outlook and guidance

• Fiscal 2026 sales expected to grow 2–4% year-over-year; adjusted operating income guidance is $2.1–$2.3 billion.

• Segment guidance: Beef loss ($500M to $250M), Chicken income ($1.65B to $1.9B), Prepared Foods income ($1.25B to $1.35B), Pork income ($250M to $300M), International income ($150M to $200M).

• CapEx projected at $700 million–$1 billion; free cash flow outlook raised to $1.1–$1.7 billion.

• Adjusted effective tax rate expected to be ~25%; net interest expense for FY26 expected at $370 million.