Tyson Foods, the world’s second-largest meat processor, has released a new line of plant-based nuggets under its famed logo for the first time. The new Tyson Nuggets have appeared in US Target stores, along with a new variety of plant-based chicken by Raised and Rooted, the company’s meat-free spinoff.
“We’re looking at everything in this environment”
The surprise launch comes as Tyson grapples with a drop in share price, flattening sales, and lower margins due to increased operational costs. In May, Tyson posted a second-quarter loss of $97M and downgraded its annual sales forecast. While the company’s second-quarter sales were $13.13Bn, compared to $13.11Bn a year before, adjusted operating income for the first half of the fiscal year dropped 80% to $518M.
First-time challenges
The company said the results were “weaker than expected”, with CEO Donnie King stating: “This is the first time I’ve seen chicken, beef, and pork all challenged at the same time. And based on everybody I talked to, no one remembers a time when that’s happened since we’ve had chicken, beef, and pork.”
In March, the company announced the closure of two US chicken processing plants, which employed nearly 1,700 workers. The following month, Tyson revealed it would eliminate 10% of corporate jobs and 15% of senior leadership roles.
Around that time, social media users began posting sightings of the new plant-based Tyson nuggets in Target stores. Amid its financial challenges, is the company re-visiting its prior interest in plant-based protein?
Re-investing in plants
In 2016, Tyson famously invested in Beyond Meat, then cut ties and sold its stake in the startup just before Beyond’s 2019 IPO. Tyson went on to launch Raised and Rooted, a new brand focused on plant-based meat offerings, which also recently debuted a new grilled chicken product.
The latest nuggets are the first to be sold under Tyson’s brand and are available in plain and Spicy varieties.
“We’re looking at everything in this environment and in an effort to be the best version of Tyson we can be,” King told investors in May. “That means to be operationally excellent, being our customers go to supplier, growing our value-added portfolio. We’re looking at those smaller, uncompetitive dated assets and [asking] how do you make them competitive? Do you move that capacity somewhere else? We’re looking across the enterprise to evaluate those things.”
