Tyson Foods (ticker: TSN) experienced a sharp decline in its stock on Monday after the company announced earnings and revenue that fell short of Wall Street's expectations. The closure of several chicken facilities resulted in a significant impairment charge for the quarter.
In the three months leading up to July, Tyson reported earnings of 15 cents per share on revenue totaling $13.1 billion. This performance fell below the 26-cent per-share profit and $13.6 billion revenue anticipated by analysts surveyed by FactSet.
Despite these challenges, Donnie King, the CEO of Tyson Foods, expressed the company's unwavering commitment to achieving sustainable growth and margin improvement. However, this statement failed to prevent a more than 7% drop in the company's shares during U.S. premarket trading on Monday.
In an effort to drive performance and improve capacity utilization, Tyson made the difficult decision to close four chicken facilities located in North Little Rock, Arkansas; Corydon, Indiana; Dexter, Missouri; and Noel, Missouri. This bold action aligns with the company's long-term strategy to strengthen Tyson Foods.
As a result of these closures, Tyson reported a $210 million goodwill impairment charge in its chicken segment.