Restructuring and Related Charges

9 Months Ended

Jun. 28, 2025

Restructuring and Related Activities [Abstract]

RESTRUCTURING AND RELATED CHARGES

Network Optimization Plan

In the first quarter of fiscal 2025, the Company initiated a network optimization plan to optimize our global operations and logistics network. We are reporting on actions approved through the end of the third quarter of fiscal 2025, including the estimated amounts for each major category of costs, as we are currently unable to make an estimate of the cost of the entire network optimization plan.

The Company approved additional actions in the third quarter of fiscal 2025 which increased the estimated charges related to actions approved through June 28, 2025 by $75 million, offset by a $107 million gain related to the sale of storage facilities. The additional estimated charges include asset write-offs, severance and related costs and contract and lease termination costs. Additionally, in the third quarter of fiscal 2025, we executed various long-term cold storage service agreements and the sale of multiple Tyson-owned and operated storage facilities which primarily support our Chicken and Prepared Foods segments. As a part of these agreements, we leased back the storage facilities for various periods ranging from approximately one to three years, and entered into long-term cold storage service agreements associated with several fully automated cold storage facilities. We expect this will reduce network complexity, streamline inventory flow, simplify processes and reduce operating expenses.

In the third quarter of fiscal 2025, we recognized income of $83 million related to the network optimization plan which included a gain of $107 million from the sale of storage facilities which was partially offset by charges of $24 million, and for the first nine months of fiscal 2025, we recognized net charges of $33 million. The charges primarily included the closure of two facilities in the Prepared Foods segment, a non-harvesting facility closure in the Beef segment and asset write-offs in the Chicken and Prepared Foods segments and International/Other. We anticipate we will recognize total pretax charges of $84 million related to actions approved through June 28, 2025, which include $51 million of charges that have resulted or will result in cash outflows and $89 million of non-cash charges. We have also received $252 million of proceeds in the first nine months of fiscal 2025 associated with the sale of storage facilities. We expect to incur costs related to the network optimization plan over a multi-year period and to incur additional charges in the future as additional actions are approved.

The following table reflects pretax (income) expense related to the network optimization plan in the third quarter of fiscal 2025 (in millions):


	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Cost of Sales:
Severance and related costs	$	—	$	—	$	1	$	—	$	—	$	1
Accelerated depreciation	—		—		—		—		—		—
Asset write-offs	—		—		9		11		—		20
Contract and lease terminations	—		—		1		2		—		3
Gain on sale of storage facilities	—		—		(38)		(69)		—		(107)

Total Cost of Sales	$	—	$	—	$	(27)	$	(56)	$	—	$	(83)

The following table reflects pretax (income) expense related to the network optimization plan in the first nine months of fiscal 2025 (in millions):


	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Cost of Sales:
Severance and related costs	$	6	$	—	$	8	$	2	$	2	$	18
Accelerated depreciation	38		—		1		—		—		39
Asset write-offs	3		—		31		34		9		77
Contract and lease terminations	1		—		1		2		—		4
Gain on sale of storage facilities	—		—		(38)		(69)		—		(107)

Total Cost of Sales	$	48	$	—	$	3	$	(31)	$	11	$	31

Selling, General and Administrative:
Severance and related costs	—		—		2		—		—		2

Total Selling, General and Administrative	$	—	$	—	$	2	$	—	$	—	$	2

Total	$	48	$	—	$	5	$	(31)	$	11	$	33

As of June 28, 2025, there was $33 million of network optimization plan liability, net of $13 million of payments during fiscal 2025.

Plant Closures and Disposals

During fiscal 2023, the Company approved the closure of six Chicken segment processing facilities and during the first half of fiscal 2024, approved the closure of two case ready value-added plants in our Beef segment and a processing facility in our Pork segment to optimize asset utilization. We shifted production to other facilities and ceased operations at these Chicken facilities throughout fiscal 2023 and the first quarter of fiscal 2024, shifted production and ceased operations at our Columbia and Jacksonville facilities during the first quarter of fiscal 2024 and shifted production and ceased operations at our Perry facility during the third quarter of fiscal 2024.

As a result of the plant closures and disposals, we recorded $23 million of additional charges in the first nine months of fiscal 2025 related to contract termination costs, which will result in cash outflows, and $41 million and $155 million of charges in the third quarter and first nine months of fiscal 2024, respectively, primarily related to accelerated depreciation, severance, retention and related costs. The charges are reflected in the Consolidated Condensed Statements of Income in Cost of Sales. Included in the results for the first nine months of fiscal 2024 are $12 million of charges that have resulted or will result in cash outflows and $143 million of non-cash charges.

The following table reflects our liability related to plant closures as of June 28, 2025 (in millions):


	Balance at September 28, 2024		Plant Closure Charges		Payments		Balance at June 28, 2025
Contract termination	$	98	$	23	$	(43)	$	78
Severance and retention	5		—		(4)		1
Total	$	103	$	23	$	(47)	$	79

During the first quarter of fiscal 2024, we experienced a fire at a production facility in the Netherlands which is included in International/Other for segment presentation, and subsequently approved the sale of the facility. For the third quarter and first nine months of fiscal 2024, charges totaled $3 million and $83 million, respectively, primarily related to property, plant and equipment impairments, severance costs, inventory write-offs and clean-up costs, partially offset by insurance proceeds. The net charges are reflected in the Consolidated Condensed Statements of Income in Cost of Sales and, for the first nine months of fiscal 2024, included $30 million of charges that have resulted or will result in cash outflows and $58 million of non-cash charges, offset by $5 million of insurance proceeds. In the third quarter of fiscal 2025, we recognized additional net insurance proceeds of $14 million.

We continue to strategically evaluate optimization of such items as network capacity, manufacturing efficiencies and business technology. If we have a significant change in strategies, outlook, or a manner in which we plan to use these assets, we may experience future charges.