UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~April 1, 2023~~March 30, 2024


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

001-14704

(Commission File Number)

TYSON FOODS, INC.

(Exact name of registrant as specified in its charter)

Delaware

71-0225165

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

2200 West Don Tyson Parkway,

Springdale,

Arkansas

72762-6999

(Address of Principal Executive Offices)

(Zip Code)

(479)

290-4000

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Class A Common Stock

Par Value

$0.10

TSN

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of ~~April 1, 2023.~~March 30, 2024.


Class						Outstanding Shares
Class A Common Stock, $0.10 Par Value (Class A stock)						~~285,600,336~~286,015,881
Class B Common Stock, $0.10 Par Value (Class B stock)						~~70,010,355~~70,009,005

Class B stock is not listed for trading on any exchange or market system. However, Class B stock is convertible into Class A stock on a share-for-share basis.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION


		PAGE
Item 1.	Financial Statements

	Consolidated Condensed Statements of Income for the ~~Three~~Thre e and Si x Months Ended March ~~Months Ended~~30, 202 4 , and April 1, 2023 , ~~and~~ ~~April 2, 2022~~	1

	Consolidated Condensed Statements of Comprehensive Income for the Three and ~~Six~~Si x Months Ended March 30, 202 4 , and April 1, 2023 , ~~and April 2, 2022~~	2

	Consolidated Condensed Balance Sheets as of ~~April 1,~~March 30 , 202 34 , and ~~October 1, 2022~~September 30, 2023	3

	Consolidated Condensed Statements of Shareholders’ Equity for the Three and Six Months Ended ~~and Six~~March 30, ~~Months Ended~~ 202 4 , and April 1, ~~2023~~20 ~~, and April 2, 2022~~23	4

	Consolidated Condensed Statements of Cash Flows for the Six Months Ended ApMarch r 30, 202 il4 , and April 1, ~~2023~~202 , ~~and April 2, 2022~~3	5

	Notes to Consolidated Condensed Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2527

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3739

Item 4.	Controls and Procedures	3940

PART II. OTHER INFORMATION


Item 1.	Legal Proceedings	40

Item 1A.	Risk Factors	4041

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 3.	Defaults Upon Senior Securities	41

Item 4.	Mine Safety Disclosures	41

Item 5.	Other Information	41

Item 6.	Exhibits	4342

SIGNATURES		4443

PART I. FINANCIAL INFORMATION

Item 1.Financial Statements

TYSON FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(In millions, except per share data)

(Unaudited)


		Three Months Ended				Six Months Ended				Three Months Ended		Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022		March 30, 2024	April 1, 2023		March 30, 2024	April 1, 2023
Sales	Sales	$	13,133	$	13,117	$	26,393	$	26,050
Cost of Sales	Cost of Sales	12,606		11,382		24,898		22,300
Gross Profit	Gross Profit	527		1,735		1,495		3,750
Selling, General and Administrative	Selling, General and Administrative	576		579		1,077		1,139

Operating Income (Loss)
Operating Income (Loss)
Operating Income (Loss)	Operating Income (Loss)	(49)		1,156		418		2,611
Other (Income) Expense:	Other (Income) Expense:
Interest income
Interest income
Interest income	Interest income	(7)		(3)		(16)		(6)
Interest expense	Interest expense	89		97		173		197
Other, net	Other, net	(1)		(25)		(43)		(77)
Total Other (Income) Expense	Total Other (Income) Expense	81		69		114		114
Income (Loss) before Income Taxes	Income (Loss) before Income Taxes	(130)		1,087		304		2,497
Income Tax Expense (Benefit)	Income Tax Expense (Benefit)	(39)		254		75		538
Net Income (Loss)	Net Income (Loss)	(91)		833		229		1,959
Less: Net Income (Loss) Attributable to Noncontrolling Interests		6		4		10		9
Less: Net Income Attributable to Noncontrolling Interests
Net Income (Loss) Attributable to Tyson	Net Income (Loss) Attributable to Tyson	$	(97)	$	829	$	219	$	1,950
Weighted Average Shares Outstanding:
Net Income (Loss) Per Share Attributable to Tyson:
Class A Basic
Class A Basic
Class A Basic	Class A Basic	284		291		285		291
Class B Basic	Class B Basic	70		70		70		70
Diluted	Diluted	354		364		356		364
Net Income (Loss) Per Share Attributable to Tyson:
Class A Basic		$	(0.28)	$	2.34	$	0.63	$	5.50
Class B Basic		$	(0.25)	$	2.11	$	0.56	$	4.95
Diluted		$	(0.28)	$	2.28	$	0.61	$	5.35

See accompanying Notes to Consolidated Condensed Financial Statements.

TYSON FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(Unaudited)


		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended										Three Months Ended			Six Months Ended
	March 30, 2024									March 30, 2024		April 1, 2023	March 30, 2024		April 1, 2023
Net Income (Loss)	Net Income (Loss)	$	(91)	$	833	$	229	$	1,959
Other Comprehensive Income (Loss), Net of Taxes:	Other Comprehensive Income (Loss), Net of Taxes:
Derivatives accounted for as cash flow hedges
Derivatives accounted for as cash flow hedges
Derivatives accounted for as cash flow hedges	Derivatives accounted for as cash flow hedges	—		1		1		1
Investments	Investments	2		(3)		2		(4)
Currency translation	Currency translation	18		28		99		27
Postretirement benefits	Postretirement benefits	1		2		1		4
Total Other Comprehensive Income (Loss), Net of Taxes	Total Other Comprehensive Income (Loss), Net of Taxes	21		28		103		28
Comprehensive Income (Loss)	Comprehensive Income (Loss)	(70)		861		332		1,987
Less: Comprehensive Income Attributable to Noncontrolling Interests		6		4		10		9
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interests
Comprehensive Income (Loss) Attributable to Tyson	Comprehensive Income (Loss) Attributable to Tyson	$	(76)	$	857	$	322	$	1,978

See accompanying Notes to Consolidated Condensed Financial Statements.

TYSON FOODS, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS

(In millions, except share and per share data)

(Unaudited)


		April 1, 2023		October 1, 2022
	March 30, 2024					March 30, 2024	September 30, 2023
Assets	Assets
Current Assets:	Current Assets:
Current Assets:
Current Assets:
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents	Cash and cash equivalents	$	543	$	1,031
Accounts receivable, net	Accounts receivable, net	2,433		2,577
Inventories	Inventories	5,504		5,514
Other current assets	Other current assets	412		508
Total Current Assets	Total Current Assets	8,892		9,630
Net Property, Plant and Equipment	Net Property, Plant and Equipment	9,351		8,685
Goodwill	Goodwill	10,550		10,513
Intangible Assets, net	Intangible Assets, net	6,157		6,252
Other Assets	Other Assets	1,846		1,741
Total Assets	Total Assets	$	36,796	$	36,821

Liabilities and Shareholders’ Equity	Liabilities and Shareholders’ Equity
Liabilities and Shareholders’ Equity
Liabilities and Shareholders’ Equity
Current Liabilities:	Current Liabilities:
Current Liabilities:
Current Liabilities:
Current debt
Current debt
Current debt	Current debt	$	1,065	$	459
Accounts payable	Accounts payable	2,387		2,483
Other current liabilities	Other current liabilities	1,894		2,371
Total Current Liabilities	Total Current Liabilities	5,346		5,313
Long-Term Debt	Long-Term Debt	7,865		7,862
Deferred Income Taxes	Deferred Income Taxes	2,438		2,458
Other Liabilities	Other Liabilities	1,589		1,377
Commitments and Contingencies (Note 15)	Commitments and Contingencies (Note 15)
Shareholders’ Equity:	Shareholders’ Equity:
Shareholders’ Equity:
Shareholders’ Equity:
Common stock ($0.10 par value):	Common stock ($0.10 par value):
Common stock ($0.10 par value):
Common stock ($0.10 par value):
Class A-authorized 900 million shares, issued 378 million shares
Class A-authorized 900 million shares, issued 378 million shares
Class A-authorized 900 million shares, issued 378 million shares	Class A-authorized 900 million shares, issued 378 million shares	38		38
Convertible Class B-authorized 900 million shares, issued 70 million shares	Convertible Class B-authorized 900 million shares, issued 70 million shares	7		7
Capital in excess of par value	Capital in excess of par value	4,541		4,553
Retained earnings	Retained earnings	19,962		20,084
Accumulated other comprehensive gain (loss)	Accumulated other comprehensive gain (loss)	(194)		(297)
Treasury stock, at cost – 92 million shares at April 1, 2023 and 88 million shares at October 1, 2022		(4,955)		(4,683)
Treasury stock, at cost – 91 million shares at March 30, 2024 and 92 million shares at September 30, 2023
Total Tyson Shareholders’ Equity	Total Tyson Shareholders’ Equity	19,399		19,702
Noncontrolling Interests	Noncontrolling Interests	159		109
Total Shareholders’ Equity	Total Shareholders’ Equity	19,558		19,811
Total Liabilities and Shareholders’ Equity	Total Liabilities and Shareholders’ Equity	$	36,796	$	36,821

See accompanying Notes to Consolidated Condensed Financial Statements.

TYSON FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions)

(Unaudited)


		Three Months Ended						Six Months Ended
		April 1, 2023			April 2, 2022			April 1, 2023			April 2, 2022
		Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
		Three Months Ended
		Three Months Ended
		Three Months Ended
		March 30, 2024
		March 30, 2024
		March 30, 2024
		Shares
		Shares
		Shares
Class A Common Stock:	Class A Common Stock:
Class A Common Stock:
Class A Common Stock:
Balance at beginning and end of period
Balance at beginning and end of period
Balance at beginning and end of period	Balance at beginning and end of period	378	$	38	378	$	38	378	$	38	378	$	38

Class B Common Stock:	Class B Common Stock:

Class B Common Stock:

Class B Common Stock:
Balance at beginning and end of period
Balance at beginning and end of period
Balance at beginning and end of period	Balance at beginning and end of period	70	7		70	7		70	7		70	7

Capital in Excess of Par Value:	Capital in Excess of Par Value:

Capital in Excess of Par Value:

Capital in Excess of Par Value:
Balance at beginning of period
Balance at beginning of period
Balance at beginning of period	Balance at beginning of period		4,524			4,471			4,553			4,486

Stock-based compensation and Other			17			39			(12)			24
Stock-based compensation and other

Stock-based compensation and other

Stock-based compensation and other

Balance at end of period

Balance at end of period

Balance at end of period	Balance at end of period		4,541			4,510			4,541			4,510

Retained Earnings:	Retained Earnings:

Retained Earnings:

Retained Earnings:
Balance at beginning of period	Balance at beginning of period		20,225			18,453			20,084			17,502
Net income (loss) attributable to Tyson			(97)			829			219			1,950
Balance at beginning of period
Balance at beginning of period
Net Income (Loss) Attributable to Tyson
Net Income (Loss) Attributable to Tyson
Net Income (Loss) Attributable to Tyson
Dividends	Dividends		(166)			(163)			(341)			(333)
Dividends
Dividends
Balance at end of period
Balance at end of period
Balance at end of period	Balance at end of period		19,962			19,119			19,962			19,119

Accumulated Other Comprehensive Income (Loss), Net of Tax:	Accumulated Other Comprehensive Income (Loss), Net of Tax:

Accumulated Other Comprehensive Income (Loss), Net of Tax:

Accumulated Other Comprehensive Income (Loss), Net of Tax:
Balance at beginning of period	Balance at beginning of period		(215)			(172)			(297)			(172)
Other comprehensive income			21			28			103			28
Balance at beginning of period
Balance at beginning of period
Other comprehensive income (loss)
Other comprehensive income (loss)
Other comprehensive income (loss)
Balance at end of period
Balance at end of period
Balance at end of period	Balance at end of period		(194)			(144)			(194)			(144)

Treasury Stock:	Treasury Stock:

Treasury Stock:

Treasury Stock:
Balance at beginning of period	Balance at beginning of period	92	(4,944)		85	(4,394)		88	(4,683)		83	(4,138)
Balance at beginning of period
Balance at beginning of period
Purchase of Class A common stock
Purchase of Class A common stock
Purchase of Class A common stock	Purchase of Class A common stock	—	(19)		2	(175)		5	(332)		6	(523)

Stock-based compensation	Stock-based compensation	—	8		(1)	53		(1)	60		(3)	145

Stock-based compensation

Stock-based compensation
Balance at end of period
Balance at end of period
Balance at end of period	Balance at end of period	92	(4,955)		86	(4,516)		92	(4,955)		86	(4,516)

Total Shareholders’ Equity Attributable to Tyson	Total Shareholders’ Equity Attributable to Tyson		$	19,399		$	19,014		$	19,399		$	19,014

Total Shareholders’ Equity Attributable to Tyson

Total Shareholders’ Equity Attributable to Tyson

Equity Attributable to Noncontrolling Interests:

Equity Attributable to Noncontrolling Interests:

Equity Attributable to Noncontrolling Interests:	Equity Attributable to Noncontrolling Interests:
Balance at beginning of period	Balance at beginning of period		$	152		$	139		$	109		$	131
Balance at beginning of period
Balance at beginning of period
Net income attributable to noncontrolling interests
Net income attributable to noncontrolling interests
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests		6			4			10			9

Business combinations	Business combinations		—			—			28			—

Business combinations

Business combinations
Currency translation and other	Currency translation and other		1			(1)			12			2
Currency translation and other
Currency translation and other
Total Equity Attributable to Noncontrolling Interests
Total Equity Attributable to Noncontrolling Interests
Total Equity Attributable to Noncontrolling Interests	Total Equity Attributable to Noncontrolling Interests		$	159		$	142		$	159		$	142

Total Shareholders’ Equity	Total Shareholders’ Equity		$	19,558		$	19,156		$	19,558		$	19,156

Total Shareholders’ Equity

Total Shareholders’ Equity

See accompanying Notes to Consolidated Condensed Financial Statements.

TYSON FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Six Months Ended

April 1, 2023

April 2, 2022

Cash Flows From Operating Activities:

Net income

229

1,959

Depreciation and amortization

620

595

Depreciation and amortization

Deferred income taxes

(29)

Deferred income taxes

Other, net

191

Net changes in operating assets and liabilities

(242)

(1,455)

Net changes in operating assets and liabilities

Cash Provided by Operating Activities

769

1,224

Cash Flows From Investing Activities:

Additions to property, plant and equipment

(1,097)

(847)

Purchases of marketable securities

(15)

(18)

Purchases of marketable securities

Proceeds from sale of marketable securities

Acquisition, net of cash acquired

(39)

—

Acquisition, net of cash acquired

Acquisition of equity investments

(37)

(96)

Other, net

(2)

Other, net

Cash Used for Investing Activities

(1,176)

(885)

Cash Flows From Financing Activities:

Proceeds from issuance of debt

Payments on debt

(121)

(1,088)

Proceeds from issuance of commercial paper

4,773

—

Proceeds from issuance of commercial paper

Repayments of commercial paper

(4,182)

—

Purchases of Tyson Class A common stock

(332)

(511)

Purchases of Tyson Class A common stock

Dividends

(336)

(328)

Stock options exercised

113

Stock options exercised

Other, net

—

Cash Used for Financing Activities

(101)

(1,767)

Other, net

Cash Provided by (Used for) Financing Activities

Effect of Exchange Rate Changes on Cash

Decrease in Cash and Cash Equivalents and Restricted Cash

(488)

(1,422)

Effect of Exchange Rate Changes on Cash

Increase (Decrease) in Cash and Cash Equivalents and Restricted Cash

Cash and Cash Equivalents and Restricted Cash at Beginning of Year

1,031

2,637

Cash and Cash Equivalents and Restricted Cash at End of Period

543

1,215

Cash and Cash Equivalents and Restricted Cash at End of Period

Less: Restricted Cash at End of Period

—

Cash and Cash Equivalents at End of Period

543

1,151

Cash and Cash Equivalents at End of Period

See accompanying Notes to Consolidated Condensed Financial Statements.

TYSON FOODS, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1: ACCOUNTING POLICIES

Basis of Presentation

The consolidated condensed financial statements are unaudited and have been prepared by Tyson Foods, Inc. (“Tyson,” “the Company,” “we,” “us” or “our”). Certain information and accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Although we believe the disclosures contained herein are adequate to make the information presented not misleading, these consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended ~~October 1, 2022.~~September 30, 2023. Preparation of consolidated condensed financial statements requires us to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated condensed financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

We believe the accompanying consolidated condensed financial statements contain all adjustments, which are of a normal recurring nature necessary to state fairly our financial position as of ~~April 1, 2023~~March 30, 2024 and the results of operations for the three and six months ended March 30, 2024 and April 1, ~~2023 and April 2, 2022.~~2023. Results of operations and cash flows for the periods presented are not necessarily indicative of results to be expected for the full year.

Consolidation

The consolidated condensed financial statements include the accounts of all wholly-owned subsidiaries, as well as majority-owned subsidiaries over which we exercise control and, when applicable, entities for which we have a controlling financial interest or variable interest entities for which we are the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

Goodwill and Intangible Assets

Goodwill is initially recorded at fair value and not amortized, but is reviewed for impairment at least annually or more frequently if impairment indicators arise. Our goodwill is evaluated for impairment by first performing a qualitative assessment to determine whether a quantitative goodwill test is necessary. If it is determined, based on qualitative factors, the fair value of the reporting unit may be more likely than not less than the carrying amount, or if significant changes to ~~macro-economic~~macroeconomic factors related to the reporting unit have occurred that could materially impact fair value, a quantitative goodwill impairment test would be required. The quantitative test is to identify if a potential impairment exists by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the carrying amount of goodwill. During fiscal 2022, we determined that all of our material reporting units’ estimated fair value exceeded their carrying value by more than 20%, other than one of our Chicken segment reporting units and two of our International reporting units with goodwill totaling $0.6 billion and $0.2 billion, respectively, at October 1, 2022. Conditions existed as of the end our first quarter that required an interim assessment of goodwill for two of our International reporting units which had goodwill totaling $0.2 billion at December 31, 2022; we determined no impairment was necessary as the fair value of the reporting units exceeded their carrying value.

Our qualitative assessment for the first and second ~~quarter~~quarters of fiscal 2024 did not indicate that it was more likely than not the fair value of any of our reporting units ~~may be impaired,~~or indefinite lived intangibles was less than the carrying amount, and as such, no quantitative ~~goodwill~~ test was deemed necessary. We consider reporting units and indefinite lived intangibles that have 20% or less excess fair value over carrying amount to have a heightened risk of impairment. The following reporting units and indefinite lived intangibles were considered at heightened risk of impairment as of the date of the most recent estimated fair value determination, which was in the fourth quarter of fiscal 2023: our Chicken segment reporting units, our Beef reporting unit and our Pork reporting unit with goodwill totaling $3.1 billion, $0.3 billion and $0.4 billion, respectively, and two Prepared Foods brands with carrying values of $0.5 billion and $0.3 billion.

Some of the inherent estimates and assumptions used in determining fair value of the reporting units are outside the control of management, including interest rates, cost of capital, tax rates, market EBITDA comparables and credit ratings. While we believe we have made reasonable estimates and assumptions to calculate the fair value of the reporting units, it is possible a material change could occur. If our actual results are not consistent with our estimates and assumptions used to calculate fair value, it could result in additional material impairments of our goodwill.

Use of Estimates

The consolidated condensed financial statements are prepared in conformity with accounting principles generally accepted in the United States, which require us to make estimates and assumptions that affect the amounts reported in the consolidated condensed financial statements and accompanying notes. Actual results could differ from those estimates. During the first quarter of fiscal 2023, we revised estimates and recorded adjustments of approximately $30 million primarily to reduce certain employee compensation accruals recorded as of October 1, 2022.

New Regulation

On November 28, 2023, the United States Department of Agriculture published the Transparency in Poultry Grower Contracting and Tournaments rule that amended section 202(a) of the Packers and Stockyards Act to introduce new disclosure requirements that live poultry dealers must furnish to contract broiler growers. The rule was effective February 12, 2024, and directed live poultry dealers to amend broiler grower contracts to reflect certain new requirements. In compliance with the rule, we offered amendments to all our broiler growers which encompassed the new requirements, including but not limited to minimum number of flock placements and stocking density. As the amendments to certain contracts created fixed minimum payments associated with embedded leases, we recognized an additional $72 million right-of-use asset and a corresponding operating lease liability in the second quarter of fiscal 2024. These are reflected in the Consolidated Condensed Balance Sheets within Other Assets, Other current liabilities and Other Liabilities.

Recently Issued Accounting Pronouncements

In ~~September 2022,~~March 2024, the SEC issued a final rule that will require registrants to provide certain climate-related information in their registration statements and annual reports. The rule is effective for annual reporting periods beginning in 2025, our fiscal 2026, and will be applied prospectively. We are currently evaluating the impact this guidance will have on our consolidated financial statements.

In December 2023, the Financial Accounting Standards Board (the "FASB") issued authoritative guidance to enhance the transparency and decision usefulness of income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The guidance is effective for annual reporting periods beginning after December 15, 2024, our fiscal 2026 and will be applied prospectively. We are currently evaluating the impact this guidance will have on disclosures in our consolidated financial statements.

In November 2023, the FASB issued authoritative guidance to improve the disclosures about a public entity's reportable segments and address requests from investors for additional, more detailed information about a reportable segment's expenses. The guidance is effective for annual reporting periods beginning after December 15, 2023, our fiscal 2025, and interim reporting periods within fiscal years beginning after December 15, 2024, our fiscal 2026. Amendments will be applied retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this guidance will have on disclosures in our consolidated financial statements.

In March 2023, the FASB issued authoritative guidance intended to address issues related to arrangements between entities under common control such as terms and conditions an entity should consider for determining whether a lease exists and the classification and accounting for that lease as well as accounting for leasehold improvements associated with leases between entities under common control. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2023, our fiscal 2025 and can be applied using either the prospective or retrospective approach. We are currently evaluating the impact this guidance will have on our consolidated financial statements.

In September 2022, the FASB issued guidance that requires additional disclosures for supplier finance programs to allow users to better understand the nature, activity and potential magnitude of the programs. The guidance, except for a requirement for rollforward information, is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2022, our fiscal 2024. Disclosure of rollforward information is effective for fiscal years beginning after December 15, 2023, our fiscal 2025. Early adoption is permitted and the retrospective transition method should be applied for all amendments except rollforward information, which should be applied prospectively. We ~~are currently evaluating~~elected to early adopt the initial disclosure requirement for the fiscal year ended September 30, 2023, and it did not have a material impact ~~this guidance will have~~ on our consolidated financial statements.

In March 2020, the FASB issued guidance providing optional expedients and exceptions to account for the effects of reference rate reform to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued. The optional guidance, which became effective on March 12, 2020 and was set to end on December 31, 2022, was extended by new guidance issued by the FASB on December 21, 2022 to apply through December 31, 2024. The temporary accounting relief provided in the optional guidance has not impacted our consolidated financial statements. The Company has various contracts that reference LIBOR and is assessing how this standard may be applied to specific contract modifications through December 31, 2024.

NOTE 2: ACQUISITIONS AND DISPOSITIONS

In the ~~second~~third quarter of fiscal 2023, ~~the Company announced it had reached a definitive agreement to acquire~~we acquired Williams Sausage Company ~~which we anticipate upon closing will be included in the Prepared Foods segment. The transaction, which is expected to close in the back half~~for $223 million, net of ~~fiscal 2023, is~~cash acquired, subject to certain ~~customary closing conditions. There can be no assurance that~~adjustments, as part of our growth strategy to increase our capacity and product portfolio. Its results, subsequent to the acquisition closing, are included in our Prepared Foods segment and through March 30, 2024 were insignificant to our Consolidated Condensed Statements of Income. Certain estimated values for the acquisition, including goodwill, intangible assets, property, plant and equipment, other liabilities, and deferred taxes are not yet finalized and are subject to revision as additional information becomes available and more detailed analyses are completed. The preliminary purchase price allocation includes $5 million of net working capital, including $3 million of cash acquired, $67 million of Property, Plant and Equipment, $119 million of Goodwill, $65 million of Intangible Assets, and $30 million of Deferred Income Taxes. Intangible Assets include brands and trademarks and customer relationships which will ~~close at such time.~~be amortized over a life of 20 and 12 years, respectively. $50 million of the goodwill is deductible for U.S. income tax purposes. The acquisition of Williams Sausage Company was accounted for using the acquisition method of accounting.

In the first quarter of fiscal 2023, we completed the acquisition of a 60% equity stake in Supreme Foods Processing Company ("SFPC"), a producer and distributor of value-added and cooked chicken and beef products, and a 15% equity stake in Agricultural Development Company ("ADC"), a fully integrated poultry company, for a total purchase price of ~~approximately~~ $75 million, net of cash acquired. Both SFPC and ADC were subsidiaries of Tanmiah Food Company. The results of SFPC, subsequent to the acquisition closing, are included in International/Other for segment ~~presentation. SFPC's results from the date of acquisition~~presentation and through ~~April 1, 2023~~March 30, 2024 were insignificant to our Consolidated Condensed Statements of Income. We are accounting for the investment in ADC under the equity method.

NOTE 3: INVENTORIES

Processed products, livestock and supplies and other are valued at the lower of cost or net realizable value. Cost includes purchased raw materials, live purchase costs, growout costs (primarily feed, livestock grower pay and catch and haul costs), labor and manufacturing and production overhead, which are related to the purchase and production of inventories. At ~~April 1, 2023,~~March 30, 2024, the cost of inventories was determined by either the first-in, first-out method or the weighted-average method, which is consistent with the methods used at ~~October 1, 2022.~~September 30, 2023. Inventories are presented net of lower of cost or net realizable value adjustments of $139 million and $145 million as of March 30, 2024 and ~~$60 million at April 1,~~September 30, 2023, ~~and October 1, 2022,~~ respectively.

The following table reflects the major components of inventory (in millions):


		April 1, 2023		October 1, 2022
	March 30, 2024					March 30, 2024	September 30, 2023
Processed products	Processed products	$	3,024	$	3,188
Livestock	Livestock	1,546		1,454
Supplies and other	Supplies and other	934		872
Total inventory	Total inventory	$	5,504	$	5,514

NOTE 4: PROPERTY, PLANT AND EQUIPMENT

The major categories of property, plant and equipment and accumulated depreciation are as follows (in millions):


		April 1, 2023		October 1, 2022
	March 30, 2024					March 30, 2024	September 30, 2023
Land	Land	$	218	$	214
Buildings and leasehold improvements	Buildings and leasehold improvements	5,961		5,742
Machinery and equipment	Machinery and equipment	10,186		9,960
Land improvements and other	Land improvements and other	529		516
Buildings and equipment under construction	Buildings and equipment under construction	2,069		1,461
		18,963		17,893
	20,075
Less accumulated depreciation	Less accumulated depreciation	9,612		9,208
Net Property, Plant and Equipment	Net Property, Plant and Equipment	$	9,351	$	8,685

NOTE 5: OTHER CURRENT LIABILITIES

Other current liabilities are as follows (in millions):


	March 30, 2024					March 30, 2024	September 30, 2023
Accrued salaries, wages and benefits

		April 1, 2023		October 1, 2022
Accrued salaries, wages and benefits		$	680	$	995

Taxes payable

Taxes payable

Taxes payable	Taxes payable	146		277
Accrued current legal contingencies	Accrued current legal contingencies	194		215
Other	Other	874		884
Total other current liabilities	Total other current liabilities	$	1,894	$	2,371

NOTE 6: RESTRUCTURING AND RELATED CHARGES

2022 Program

~~In the fourth quarter of fiscal 2022, the~~The Company approved a restructuring program in fiscal 2022 (the “2022 Program”)~~, which is expected~~ to improve business performance, increase collaboration, enhance team member agility, enable faster decision-making and reduce redundancies. In conjunction with the 2022 Program, the Company is bringing together all its corporate team members from the Chicago, Downers Grove and Dakota Dunes area corporate locations to its world headquarters in Springdale, Arkansas, through a phased relocation which commenced in early calendar year 2023. We anticipate the 2022 Program and associated expenses will be substantially complete in our fiscal 2025. The following table reflects the total pretax anticipated expenses associated with the 2022 Program (in millions):


		Beef
		Beef		Pork		Chicken		Prepared Foods		International/Other		Total
		Beef

		Beef
Severance costs
Severance costs
Severance costs	Severance costs	$	20	$	7	$	5	$	48	$	10	$	90
Relocation and related costs	Relocation and related costs	38		15		2		61		1		117
Relocation and related costs
Relocation and related costs
Accelerated depreciation
Accelerated depreciation
Accelerated depreciation	Accelerated depreciation	6		2		—		12		—		20
Contract and lease terminations	Contract and lease terminations	—		—		—		31		—		31
Contract and lease terminations
Contract and lease terminations
Professional and other fees
Professional and other fees
Professional and other fees	Professional and other fees	3		—		1		7		2		13
Total 2022 Program	Total 2022 Program	$	67	$	24	$	8	$	159	$	13	$	271
Total 2022 Program
Total 2022 Program

Restructuring costs include severance expenses and related charges ~~include costs~~ directly associated with the 2022 Program such as relocation, contract and lease terminations, professional fees and accelerated depreciation resulting from the closure of facilities. We anticipate that $48 million and ~~$223~~$180 million of the total pretax anticipated expense will be recorded in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income. Included in the table above are ~~$241~~$202 million of charges that have resulted or will result in cash outflows and ~~$30~~$26 million in non-cash charges.

The following table reflects the pretax impact of the 2022 Program’s restructuring and related charges during the second quarter of fiscal 2024 by reportable segment (in millions):



	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Severance costs	$	—	$	(1)	$	(2)	$	(1)	$	—	$	(4)
Relocation and related costs	—		1		—		1		—		2
Accelerated depreciation	—		—		—		—		—		—
Contract and lease terminations	—		—		—		3		—		3
Professional and other fees	—		—		—		—		—		—
Total	$	—	$	—	$	(2)	$	3	$	—	$	1

For the second quarter of fiscal 2024, we recorded restructuring and related (reduction) charges of $(3) million and $4 million in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income.

The following table reflects the pretax impact of the 2022 Program’s restructuring and related charges during the second quarter of fiscal 2023 by reportable segment (in millions):


	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Severance costs	$	—	$	—	$	(1)	$	2	$	1	$	2
Relocation and related costs	6		1		1		5		—		13
Accelerated depreciation	1		1		—		2		—		4
Contract and lease terminations	—		—		—		—		—		—
Professional and other fees	1		—		—		2		—		3
Total	$	8	$	2	$	—	$	11	$	1	$	22

For the second quarter of fiscal 2023, we recorded restructuring and related (reduction) charges of $(4) million and $26 million in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income.

The following table reflects the pretax impact of the 2022 Program’s restructuring and related charges during the first six months of fiscal 2024 by reportable segment (in millions):


	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Severance costs	$	1	$	—	$	2	$	1	$	—	$	4
Relocation and related costs	3		1		—		4		—		8
Accelerated depreciation	—		—		—		—		—		—
Contract and lease terminations	—		—		—		19		—		19
Professional and other fees	—		—		—		—		—		—
Total	$	4	$	1	$	2	$	24	$	—	$	31

For the first six months of fiscal 2024, we recorded restructuring and related charges of $31 million in Selling, General and Administrative ~~and a reduction of $4 million in Cost of Sales~~ in our Consolidated Condensed Statements of Income. Included in the above results are ~~$18~~$21 million of charges that have resulted or will result in cash outflows and $4$10 million in non-cash charges.

The following table reflects the pretax impact of the 2022 Program’s restructuring and related charges during the first six months of fiscal 2023 by reportable segment (in millions):


	Beef		Pork		Chicken		Prepared Foods		International/Other		Total
Severance costs	$	2	$	1	$	(1)	$	6	$	6	$	14
Relocation and related costs	7		2		2		6		—		17
Accelerated depreciation	3		1		—		6		—		10
Contract and lease terminations	—		—		—		(2)		—		(2)
Professional and other fees	1		—		—		3		—		4
Total	$	13	$	4	$	1	$	19	$	6	$	43

For the first six months of fiscal 2023, we recorded restructuring and related charges of $4 million and $39 million in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income. Included in the above results are $35 million of charges that have resulted or will result in cash outflows and $8 million in non-cash charges.

The following table reflects the pretax 2022 Program charges to date by reportable segment (in millions):


		Beef
		Beef		Pork		Chicken		Prepared Foods		International/Other		Total
		Beef

		Beef
Severance costs
Severance costs
Severance costs	Severance costs	$	18	$	6	$	5	$	42	$	9	$	80
Relocation and related costs	Relocation and related costs	7		2		2		6		—		17
Relocation and related costs
Relocation and related costs
Accelerated depreciation
Accelerated depreciation
Accelerated depreciation	Accelerated depreciation	3		1		—		6		—		10
Contract and lease terminations	Contract and lease terminations	—		—		—		(2)		—		(2)
Contract and lease terminations
Contract and lease terminations
Professional and other fees
Professional and other fees
Professional and other fees	Professional and other fees	1		—		—		3		—		4
Total	Total	$	29	$	9	$	7	$	55	$	9	$	109
Total
Total

~~As of~~Through the second quarter of fiscal ~~2023,~~2024, we recorded restructuring and related charges to date of ~~$22~~$47 million and ~~$87~~$174 million in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income. Included in the above results are ~~$101~~$195 million of charges to date that have resulted or will result in cash outflows and $8$26 million in non-cash charges to date.

The following table reflects our liability related to the 2022 Program, which was recognized in other current liabilities in our Consolidated Condensed Balance sheet as of ~~April 1, 2023~~March 30, 2024 (in millions):


		Balance at September 30, 2023
		Balance at October 1, 2022		Restructuring Expense		Payments		Changes in Estimates		Balance at April 1, 2023
		Balance at September 30, 2023

		Balance at September 30, 2023
Severance costs
Severance costs
Severance costs	Severance costs	$	66	$	18	$	7	$	(4)	$	73
Relocation and related costs	Relocation and related costs	—		17		13		—		4
Relocation and related costs
Relocation and related costs
Contract and lease termination
Contract and lease termination
Contract and lease termination
Professional and other fees
Professional and other fees
Professional and other fees	Professional and other fees	—		4		1		—		3
Total	Total	$	66	$	39	$	21	$	(4)	$	80
Total
Total

As the Company continues to evaluate its business strategies and long-term growth targets, additional restructuring activities may occur.

Plant Closures

InDuring fiscal 2023, as part of a strategic review of assets, the Company approved the closure of six Chicken segment processing facilities located in Glen Allen, Virginia; Van Buren, Arkansas; Corydon, Indiana; Dexter, Missouri; Noel, Missouri; and North Little Rock, Arkansas, to optimize asset utilization. As of March 30, 2024, we shifted production to other facilities and ceased operations at all six facilities. Additionally, during the first quarter of fiscal 2024, the Company approved the closure of two case ready value-added plants in our Beef segment located in Columbia, South Carolina and Jacksonville, Florida and during the second quarter of fiscal ~~2023, in order to further optimize our network to reach full capacity in our facilities, management~~2024 approved ~~and communicated~~ the ~~planned~~ closure of ~~two~~a Pork segment processing facility in Perry, Iowa to optimize asset utilization. We shifted production to other facilities and ceased operations at our Columbia and Jacksonville facilities during the first quarter of fiscal 2024 and expect to shift production and cease operations at our Perry facility during the ~~Company's Chicken facilities in Glen Allen, Virginia and Van Buren, Arkansas.~~ third quarter of fiscal 2024.

As a result of the plant closures, we recorded $39 million and $114 million of charges in the second quarter and first six months of fiscal 2024, respectively, and $92 million of charges in ~~closure charges,~~the second quarter and first six months of fiscal 2023, primarily related to ~~grower contract terminations,~~ accelerated depreciation, ~~and~~ severance, retention and related costs. ~~The facilities are expected to cease operations in the third quarter of fiscal 2023.~~ The charges are reflected in the Consolidated Condensed Statements of Income in Cost of Sales. Included in the results for the first six months of fiscal 2024 are $2 million of charges that have resulted or will result in cash outflows and $112 million in non-cash charges. Included in the results for the first six months of fiscal 2023 are $83 million of charges that have resulted or will result in cash outflows and $9 million of non-cash charges.

The following table reflects our liability related to plant closures as of March 30, 2024 (in millions):


	Balance at September 30, 2023		Plant Closure Charges		Payments		Balance at March 30, 2024
Contract termination	$	151	$	11	$	(50)	$	112
Severance and retention	14		5		(9)		10
Total	$	165	$	16	$	(59)	$	122

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. In the second quarter of fiscal 2024, we recognized additional charges due to our current intention to discontinue use of certain productive assets associated with this facility. For the second quarter and first six months of fiscal 2024, these charges totaled $54 million and $80 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 six months of fiscal 2024, included $32 million of charges that have resulted or will result in cash outflows and $53 million of non-cash charges, offset by $5 million of insurance proceeds.

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.

NOTE 7: DEBT

The major components of debt are as follows (in millions):


		April 1, 2023		October 1, 2022
	March 30, 2024					March 30, 2024	September 30, 2023
Revolving credit facility	Revolving credit facility	$	—	$	—
Commercial paper	Commercial paper	593		—
Senior notes:	Senior notes:

3.90% Senior notes due September 2023		400		400

3.95% Notes due August 2024

3.95% Notes due August 2024

3.95% Notes due August 2024	3.95% Notes due August 2024	1,250		1,250
4.00% Notes due March 2026 (“2026 Notes”)	4.00% Notes due March 2026 (“2026 Notes”)	800		800
3.55% Notes due June 2027	3.55% Notes due June 2027	1,350		1,350
7.00% Notes due January 2028	7.00% Notes due January 2028	18		18
4.35% Notes due March 2029 (“2029 Notes”)	4.35% Notes due March 2029 (“2029 Notes”)	1,000		1,000
5.40% Notes due March 2029 ("5.40% 2029 Notes")
6.13% Notes due November 2032	6.13% Notes due November 2032	158		160
5.70% Notes due March 2034 ("5.70% 2034 Notes")
4.88% Notes due August 2034	4.88% Notes due August 2034	500		500
5.15% Notes due August 2044	5.15% Notes due August 2044	500		500
4.55% Notes due June 2047	4.55% Notes due June 2047	750		750
5.10% Notes due September 2048 (“2048 Notes”)	5.10% Notes due September 2048 (“2048 Notes”)	1,500		1,500
Discount on senior notes	Discount on senior notes	(38)		(39)

Term loans:
Term loan facility due May 2026 (6.68% at March 30, 2024)
Term loan facility due May 2026 (6.68% at March 30, 2024)
Term loan facility due May 2026 (6.68% at March 30, 2024)
Term loan facility due May 2028 (7.17% at March 30, 2024)
Other	Other	189		175
Unamortized debt issuance costs	Unamortized debt issuance costs	(40)		(43)
Total debt	Total debt	8,930		8,321
Less current debt	Less current debt	1,065		459
Total long-term debt	Total long-term debt	$	7,865	$	7,862

Revolving Credit Facility and Letters of Credit

We have a $2.25 billion revolving credit facility that supports short-term funding needs and serves as a backstop to our commercial paper program. The facility will mature and the commitments thereunder will terminate in September 2026 with options for two one-year extensions. At ~~April 1, 2023,~~March 30, 2024, amounts available for borrowing under this facility totaled $2.25 billion ~~before deducting amounts to backstop our commercial paper program. At April 1, 2023~~and we had no outstanding borrowings and no outstanding letters of credit issued under this facility. At ~~April 1, 2023~~March 30, 2024 we had ~~$102~~$90 million of bilateral letters of credit issued separately from the revolving credit facility, none of which were drawn upon. Our letters of credit are issued primarily in support of workers’ compensation insurance programs and other legal obligations. In the future, if any of our subsidiaries shall guarantee any of our material indebtedness, such subsidiary shall be required to guarantee the indebtedness, obligations and liabilities under this facility. In November 2022, we entered into an amendment to change the reference rate from the London interbank offered rate (commonly referred to as LIBOR) to a rate based on the secured overnight financing rate (commonly referred to as SOFR).

Commercial Paper Program

We have a commercial paper program under which we may issue unsecured short-term promissory notes up to an aggregate maximum principal amount of $1.5 billion. As of ~~April 1, 2023,~~March 30, 2024, we had ~~$593 million of~~no commercial paper outstanding ~~at a weighted average interest rate of 5.41% with maturities of less than 25 days~~. Our ability to access commercial paper in the future may be limited or its costs increased.

5.40% 2029 Notes/5.70% 2034 Notes

In March 2024, we issued senior unsecured notes with an aggregate principal amount of $1.5 billion, consisting of $600 million due March 2029 ("5.40% 2029 Notes") and $900 million due March 2034 ("5.70% 2034 Notes"). A portion of the net proceeds from the issuances were used to repay $250 million of the amount outstanding under our term loan facility due May 2026 and we expect to use the remainder of the proceeds to retire the August 2024 notes. Interest payments on the 5.40% 2029 Notes and 5.70% 2034 Notes are due semi-annually on March 15 and September 15, beginning September 15, 2024. After the original issue discounts of $3 million, we received net proceeds of $1,497 million and incurred debt issuance costs of $14 million related to the issuances.

Term Loan Facilities

~~On May 3, 2023, we executed two new term loan facilities totaling $1.75 billion to refinance our short-term promissory notes ("commercial paper program") and for general corporate purposes. The first~~We have a $750 million term loan facility ~~totaling $1.0 billion~~that matures ~~three years following the date of the initial borrowing. The second~~in May 2026 and a $750 million term loan facility ~~totaling~~that matures in May 2028. In the first quarter of fiscal 2024, we borrowed the full $750 million available under the loan facility that matures ~~five years from~~in May ~~3, 2023, the date~~2028 and used it to repay $592 million of ~~closing.~~outstanding commercial paper obligations. Both term loans may be prepaid under certain ~~conditions. Additionally, the term loan facilities~~conditions and contain covenants that are similar to those contained in the revolving credit facility.

Debt Covenants

Our revolving credit ~~facility contains~~and term loan facilities contain affirmative and negative covenants that, among other things, may limit or restrict our ability to: create liens and encumbrances; incur debt; merge, dissolve, liquidate or consolidate; make acquisitions and investments; dispose of or transfer assets; change the nature of our business; engage in certain transactions with affiliates; and enter into hedging transactions, in each case, subject to certain qualifications and exceptions. In addition, we are required to maintain a minimum interest expense coverage ratio.

Our senior notes also contain affirmative and negative covenants that, among other things, may limit or restrict our ability to: create liens; engage in certain sale/leaseback transactions; and engage in certain consolidations, mergers and sales of assets.

We were in compliance with all debt covenants at ~~April 1, 2023.~~March 30, 2024.

NOTE 8: EQUITY

Share Repurchases

As of ~~April 1, 2023,~~March 30, 2024, 7.3 million shares remained available for repurchase under the Company's share repurchase program. The program has no fixed or scheduled termination date, and the timing and extent to which we repurchase shares will depend upon, among other things, our working capital needs, markets, industry conditions, liquidity targets, limitations under our debt obligations and regulatory requirements. In addition to the share repurchase program, we purchase shares on the open market to fund certain obligations under our equity compensation plans. A summary of share repurchases of our Class A stock is as follows (in millions):


			Three Months Ended						Six Months Ended
			April 1, 2023			April 2, 2022			April 1, 2023			April 2, 2022
			Shares	Dollars		Shares	Dollars		Shares	Dollars		Shares	Dollars
		Three Months Ended																Three Months Ended				Six Months Ended
		March 30, 2024														March 30, 2024			April 1, 2023		March 30, 2024		April 1, 2023
		Shares													Shares		Dollars	Shares		Dollars	Shares	Dollars		Shares	Dollars
Shares repurchased:	Shares repurchased:
Under share repurchase program
Under share repurchase program
Under share repurchase program	Under share repurchase program		—	$	—	1.5	$	132	4.7	$	300	5.1	$	432
To fund certain obligations under equity compensation plans	To fund certain obligations under equity compensation plans		0.3	19		0.5	43		0.5	32		1.1	91
Total share repurchases	Total share repurchases		0.3	$	19	2.0	$	175	5.2	$	332	6.2	$	523

NOTE 9: INCOME TAXES

Our effective tax rate was 26.9% on pretax income for the second quarter of fiscal 2024, 29.4% on pretax loss for the second quarter of fiscal 2023, ~~23.4% on pretax income for the second quarter of fiscal 2022,~~and 28.0% and 24.7% ~~and 21.6%~~ on pretax income for the first six months of fiscal ~~2023~~2024 and ~~2022,~~2023, respectively. In all periods presented, the effective tax rates were increased due to state taxes and include the impact of various tax benefits; however, tax benefits increase the effective tax rate in a period of pretax loss and decrease the effective tax rate in a period of pretax income. Additionally, the effective tax ~~rate~~rates for the second quarter and first six months of fiscal ~~2022 includes a $36 million benefit from~~2024 are higher than the ~~remeasurement of deferred income taxes, primarily~~federal statutory tax rate due to ~~legislation decreasing state~~the impact of foreign losses for which a tax ~~rates enacted in the first quarter of fiscal 2022.~~benefit cannot be recognized.

Unrecognized tax benefits were ~~$157~~$134 million and ~~$152~~$131 million at ~~April 1,~~March 30, 2024 and September 30, 2023, ~~and October 1, 2022,~~ respectively.

In December 2021, we received an assessment from the Mexican tax authorities related to the 2015 sale of our direct and indirect equity interests in subsidiaries which held our Mexico operations. The assessment totals approximately ~~$470~~$528 million ~~(8.5~~(8.8 billion Mexican pesos), which includes tax, inflation adjustment, interest and penalties. We believe the assertions made in the assessment letter have no merit and will defend our positions through the Mexican administrative appeal process and litigation, if necessary. Based on our analysis of this assessment in accordance with FASB guidance related to unrecognized tax benefits, we have not recorded a liability related to the issue.

1113

NOTE 10: EARNINGS (LOSS) PER SHARE

The following table sets forth the computation of basic and diluted earnings (loss) per share (in millions, except per share data):


		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended												Three Months Ended				Six Months Ended
	March 30, 2024										March 30, 2024			April 1, 2023		March 30, 2024			April 1, 2023
Numerator:	Numerator:
Net income (loss)
Net income (loss)
Net income (loss)	Net income (loss)	$	(91)	$	833	$	229	$	1,959
Less: Net income attributable to noncontrolling interests	Less: Net income attributable to noncontrolling interests	6		4		10		9
Net income (loss) attributable to Tyson	Net income (loss) attributable to Tyson	(97)		829		219		1,950
Less dividends declared:	Less dividends declared:
Class A	Class A	136		134		279		274
Class A
Class A
Class B	Class B	30		29		62		59
Undistributed earnings (losses)	Undistributed earnings (losses)	$	(263)	$	666	$	(122)	$	1,617

Class A undistributed earnings (losses)
Class A undistributed earnings (losses)
Class A undistributed earnings (losses)	Class A undistributed earnings (losses)	$	(216)	$	547	$	(100)	$	1,329
Class B undistributed earnings (losses)	Class B undistributed earnings (losses)	(47)		119		(22)		288
Total undistributed earnings (losses)	Total undistributed earnings (losses)	$	(263)	$	666	$	(122)	$	1,617

Denominator:	Denominator:
Denominator:
Denominator:
Denominator for basic earnings per share:
Denominator for basic earnings per share:
Denominator for basic earnings per share:	Denominator for basic earnings per share:
Class A weighted average shares	Class A weighted average shares	284		291		285		291
Class B weighted average shares, and shares under the if-converted method for diluted earnings per share		70		70		70		70
Effect of dilutive securities:
Stock options, restricted stock and performance units		—		3		1		3
Class A weighted average shares
Class A weighted average shares
Class B weighted average shares

Denominator for diluted earnings (loss) per share – adjusted weighted average shares and assumed conversions		354		364		356		364
Denominator for diluted earnings per share:
Denominator for diluted earnings per share:
Denominator for diluted earnings per share:
Class A weighted average shares
Class A weighted average shares
Class A weighted average shares										284		284			284			285
Class B weighted average shares under the if-converted method for diluted earnings per share(a)
Effect of dilutive securities: Stock options, restricted stock and performance units

Denominator for diluted earnings (loss) per share – weighted average shares and assumed conversions(a)
Denominator for diluted earnings (loss) per share – weighted average shares and assumed conversions(a)
Denominator for diluted earnings (loss) per share – weighted average shares and assumed conversions(a)

Net income (loss) per share attributable to Tyson:	Net income (loss) per share attributable to Tyson:

Net income (loss) per share attributable to Tyson:

Net income (loss) per share attributable to Tyson:
Class A basic
Class A basic
Class A basic	Class A basic	$	(0.28)	$	2.34	$	0.63	$	5.50
Class B basic	Class B basic	$	(0.25)	$	2.11	$	0.56	$	4.95
Diluted		$	(0.28)	$	2.28	$	0.61	$	5.35
Diluted(a)
Dividends Declared Per Share:	Dividends Declared Per Share:
Class A	Class A	$	0.480	$	0.460	$	0.980	$	0.935
Class A
Class A
Class B	Class B	$	0.432	$	0.414	$	0.882	$	0.842

(a) For the second quarter of fiscal 2023, as the Company was in a net loss position, the impact of the Class B shares under the if-converted method is antidilutive and therefore we have not assumed conversion. As a result, the Class B weighted average shares, dividends declared and undistributed losses were excluded for the purposes of calculating Net Income (Loss) Per Share Attributable to Tyson on a diluted basis. Accordingly, the Company adjusted the presentation for the second quarter of fiscal 2023 to remove the 70 million Class B weighted average shares, which did not change diluted net loss per share attributable to Tyson.

Approximately 7 million of our stock-based compensation shares were antidilutive for the three and six months ended March 30, 2024. Approximately 10 million and 5 million of our stock-based compensation shares were antidilutive for the three and six months ended April 1, 2023, respectively. ~~Approximately 2 million of our stock-based compensation shares were antidilutive for the three and six months ended April 2, 2022.~~ These shares were not included in the diluted earnings per share calculation.

We have two classes of capital stock, Class A stock and Class B stock. Cash dividends cannot be paid to holders of Class B stock unless they are simultaneously paid to holders of Class A stock. The per share amount of cash dividends paid to holders of Class B stock cannot exceed 90% of the cash dividends paid to holders of Class A stock.

We allocate undistributed earnings (losses) based upon a 1.0 to 0.9 ratio per share to Class A stock and Class B stock, respectively. We allocate undistributed earnings based on this ratio due to historical dividend patterns, voting control of Class B shareholders and contractual limitations of dividends to Class B stock.

NOTE 11: DERIVATIVE FINANCIAL INSTRUMENTS

Our business operations give rise to certain market risk exposures mostly due to changes in commodity prices, foreign currency exchange rates and interest rates. We manage a portion of these risks through the use of derivative financial instruments to reduce our exposure to commodity price risk, foreign currency risk and interest rate risk. Our risk management programs are periodically reviewed by our Board of Directors’ Audit Committee. These programs and risks are monitored by senior management and may be revised as market conditions dictate. Our current risk management programs utilize various industry-standard models that take into account the implicit cost of hedging. Credit risks associated with our derivative contracts are not significant as we minimize counterparty exposure by dealing with credit-worthy counterparties and utilizing exchange traded instruments, margin accounts or letters of credit. Additionally, our derivative contracts are mostly short-term in duration and we generally do not make use of credit-risk-related contingent features. No significant concentrations of credit risk existed at ~~April 1, 2023.~~March 30, 2024.

We had the following net aggregated outstanding notional amounts related to our derivative financial instruments:

in millions, except soybean meal tons

Metric

April 1, 2023

October 1, 2022

in millions, except soybean meal tons

Metric

March 30, 2024

September 30, 2023

Commodity:

Corn

Bushels

Soybean Meal

Tons

619,900

532,700

Live Cattle

Pounds

366

280

Lean Hogs

Pounds

232

339

Foreign Currency

United States dollar

141

249

We recognize all derivative instruments as either assets or liabilities at fair value in the Consolidated Condensed Balance Sheets, with the exception of normal purchases and normal sales expected to result in physical delivery. For those derivative instruments that are designated and qualify as hedging instruments, we designate the hedging instrument based upon the exposure being hedged (e.g., cash flow hedge or fair value hedge). We designate certain forward contracts as follows:

•Cash Flow Hedges – include certain commodity forward and option contracts of forecasted purchases (e.g., grains), interest rate swaps and locks and certain foreign exchange forward contracts

•Fair Value Hedges – include certain commodity forward contracts of firm commitments (e.g., livestock)

Cash Flow Hedges

Derivative instruments are designated as hedges against changes in the amount of future cash flows related to procurement of certain commodities utilized in our production processes as well as interest rates to our variable rate debt. For the derivative instruments we designate and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income (“OCI”) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses representing hedge ineffectiveness are recognized in earnings in the current period. Ineffectiveness related to our cash flow hedges was not significant for the three and six months ended March 30, 2024, and April 1, ~~2023, and April 2, 2022.~~2023. As of ~~April 1, 2023,~~March 30, 2024, we had ~~$13~~$11 million of realized losses related to treasury rate locks in connection with the issuance of the 2026, 2029 and 2048 Notes, which will be reclassified to earnings over the lives of these notes. During the six months ended March 30, 2024 and April 1, 2023, ~~and April 2, 2022,~~ we did not reclassify significant pretax gains or losses into earnings as a result of the discontinuance of cash flow hedges. For the six months ended March 30, 2024 and April 1, 2023, ~~and April 2, 2022,~~ we had no gains or losses recognized in OCI on derivatives designated as cash flow hedges.

Fair Value Hedges

We designate certain derivative contracts as fair value hedges of firm commitments to purchase livestock for harvest. Our objective of these hedges is to minimize the risk of changes in fair value created by fluctuations in commodity prices associated with fixed price livestock firm commitments. For these derivative instruments we designate and qualify as a fair value hedge, the gain or loss on the derivative, as well as the offsetting gain or loss on the hedged item attributable to the hedged risk, are recognized in earnings in the same period. We include the gain or loss on the hedged items (e.g., livestock purchase firm commitments) in the same line item, Cost of Sales, as the offsetting gain or loss on the related livestock forward position. Ineffectiveness related to fair value hedges was not significant for the three and six months ended March 30, 2024, and April 1, ~~2023, and April 2, 2022.~~2023. The following table sets forth the carrying amount of fair value hedge (assets) liabilities as of ~~April 1,~~March 30, 2024 and September 30, 2023 ~~and October 1, 2022~~ (in millions):

Consolidated Condensed Balance Sheets Classification

April 1, 2023

October 1, 2022

Consolidated Condensed Balance Sheets Classification

Inventory

(12)

Undesignated Positions

In addition to our designated positions, we also hold derivative contracts for which we do not apply hedge accounting. These include certain derivative instruments related to commodities price risk, including grains, livestock, energy and foreign currency risk. We mark these positions to fair value through earnings at each reporting date.

1315

Reclassification to Earnings

The following table sets forth the total amounts of each income and expense line item presented in the Consolidated Condensed Statements of Income in which the effects of hedges are recorded (in millions):


Consolidated Condensed Statements of Income Classification

Consolidated Condensed Statements of Income Classification	Consolidated Condensed Statements of Income Classification	Three Months Ended				Six Months Ended				Consolidated Condensed Statements of Income Classification	Three Months Ended		Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022			March 30, 2024	April 1, 2023		March 30, 2024	April 1, 2023
Cost of Sales	Cost of Sales	$	12,606	$	11,382	$	24,898	$	22,300
Interest Expense	Interest Expense	89		97		173		197
Other, net	Other, net	(1)		(25)		(43)		(77)

The following table sets forth the pretax impact of the cash flow, fair value and undesignated derivative instruments in the Consolidated Condensed Statements of Income (in millions):


Consolidated Condensed Statements of Income Classification	Consolidated Condensed Statements of Income Classification		Three Months Ended				Six Months Ended
			April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
Consolidated Condensed Statements of Income Classification											Consolidated Condensed Statements of Income Classification	Three Months Ended		Six Months Ended
												March 30, 2024	April 1, 2023		March 30, 2024	April 1, 2023
Cost of Sales	Cost of Sales	Gain (Loss) on cash flow hedges reclassified from OCI to Earnings:
		Commodity contracts (a)
		Commodity contracts (a)
		Commodity contracts (a)
		Commodity contracts	$	—	$	—	$	—	$	—
		Gain (Loss) on fair value hedges:
		Commodity contracts (a)	2		(13)		(1)		(16)

		Gain (Loss) on derivatives not designated as hedging instruments:
		Commodity contracts	(23)		99		(8)		180
		Gain (Loss) on derivatives not designated as hedging instruments:
		Gain (Loss) on derivatives not designated as hedging instruments:
		Gain (Loss) on derivatives not designated as hedging instruments:
		Commodity contracts
		Commodity contracts
		Commodity contracts
Total	Total		$	(21)	$	86	$	(9)	$	164

Interest Expense	Interest Expense	Gain (Loss) on cash flow hedges reclassified from OCI to Earnings:
		Interest rate contracts	$	—	$	(1)	$	(1)	$	(1)
Interest Expense
Interest Expense
		Interest rate contracts
		Interest rate contracts
		Interest rate contracts

Other, net	Other, net	Gain (Loss) on derivatives not designated as hedging instruments:
		Foreign exchange contracts	$	5	$	4	$	10	$	4
Other, net

Other, net
		Foreign exchange contracts
		Foreign exchange contracts
		Foreign exchange contracts

(a) Amounts represent gains/(losses) on commodity contracts designated as fair value hedges of firm commitments that were realized during the period presented, which were offset by a corresponding gain/(loss) on the underlying hedged inventory. Gains or losses related to changes in the fair value of unrealized commodity contracts, along with the offsetting gain or loss on the hedged inventory, are also marked-to-market through earnings with no impact on a net basis.

The fair value of all outstanding derivative instruments in the Consolidated Condensed Balance Sheets are included in Note 12: Fair Value Measurements.

NOTE 12: FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy contains three levels as follows:

Level 1 — Unadjusted quoted prices available in active markets for the identical assets or liabilities at the measurement date.

Level 2 — Other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:

•Quoted prices for similar assets or liabilities in active markets;

•Quoted prices for identical or similar assets in non-active markets;

•Inputs other than quoted prices that are observable for the asset or liability; and

•Inputs derived principally from or corroborated by other observable market data.

Level 3 — Unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.

1416

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The fair value hierarchy requires the use of observable market data when available. In instances where the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

The following tables set forth by level within the fair value hierarchy our financial assets and liabilities accounted for at fair value on a recurring basis according to the valuation techniques we used to determine their fair values (in millions):


April 1, 2023		Level 1		Level 2		Level 3		Netting (a)		Total
March 30, 2024												March 30, 2024	Level 1	Level 2	Level 3	Netting (a)	Total
Other Current Assets:	Other Current Assets:
Derivative financial instruments:	Derivative financial instruments:
Derivative financial instruments:
Derivative financial instruments:
Designated as hedges
Designated as hedges
Designated as hedges	Designated as hedges	$	—	$	14	$	—	$	(6)	$	8
Undesignated	Undesignated	—		106		—		(49)		57
Available-for-sale securities (current)	Available-for-sale securities (current)	—		7		—		—		7

Other Assets:	Other Assets:
Other Assets:
Other Assets:
Available-for-sale securities (non-current)
Available-for-sale securities (non-current)
Available-for-sale securities (non-current)	Available-for-sale securities (non-current)	—		64		33		—		97
Deferred compensation assets	Deferred compensation assets	24		378		—		—		402
Total assets	Total assets	$	24	$	569	$	33	$	(55)	$	571
Other Current Liabilities:	Other Current Liabilities:
Derivative financial instruments:	Derivative financial instruments:
Derivative financial instruments:
Derivative financial instruments:
Designated as hedges
Designated as hedges
Designated as hedges	Designated as hedges	$	—	$	11	$	—	$	(11)	$	—
Undesignated	Undesignated	—		105		—		(89)		16

Total liabilities	Total liabilities	$	—	$	116	$	—	$	(100)	$	16
Total liabilities
Total liabilities


October 1, 2022		Level 1		Level 2		Level 3		Netting (a)		Total
September 30, 2023												September 30, 2023	Level 1	Level 2	Level 3	Netting (a)	Total
Other Current Assets:	Other Current Assets:
Derivative financial instruments:	Derivative financial instruments:
Derivative financial instruments:
Derivative financial instruments:
Designated as hedges
Designated as hedges
Designated as hedges	Designated as hedges	$	—	$	14	$	—	$	(6)	$	8
Undesignated	Undesignated	—		154		—		(58)		96
Available-for-sale securities (current)	Available-for-sale securities (current)	—		1		—		—		1

Other Assets:	Other Assets:
Other Assets:
Other Assets:
Available-for-sale securities (non-current)
Available-for-sale securities (non-current)
Available-for-sale securities (non-current)	Available-for-sale securities (non-current)	—		65		35		—		100
Deferred compensation assets	Deferred compensation assets	38		327		—		—		365
Total assets	Total assets	$	38	$	561	$	35	$	(64)	$	570
Other Current Liabilities:	Other Current Liabilities:
Derivative financial instruments:	Derivative financial instruments:
Derivative financial instruments:
Derivative financial instruments:
Designated as hedges
Designated as hedges
Designated as hedges	Designated as hedges	$	—	$	2	$	—	$	(2)	$	—
Undesignated	Undesignated	—		106		—		(72)		34

Total liabilities	Total liabilities	$	—	$	108	$	—	$	(74)	$	34
Total liabilities
Total liabilities

(a) Our derivative assets and liabilities are presented in our Consolidated Condensed Balance Sheets on a net basis when a legally enforceable master netting arrangement exists between the counterparty to a derivative contract and us. Additionally, at ~~April 1,~~March 30, 2024, and September 30, 2023, ~~and October 1, 2022,~~ we had ~~$45~~$88 million and ~~$10~~$113 million, respectively, of net cash collateral with various counterparties where master netting arrangements exist and held no cash collateral.

1517

The following table provides a reconciliation between the beginning and ending balance of marketable debt securities measured at fair value on a recurring basis in the table above that used significant unobservable inputs (Level 3) (in millions):


		Six Months Ended
		April 1, 2023		April 2, 2022
	Six Months Ended						Six Months Ended
	March 30, 2024					March 30, 2024		April 1, 2023
Balance at beginning of year	Balance at beginning of year	$	35	$	48
Total realized and unrealized gains (losses):	Total realized and unrealized gains (losses):

Included in other comprehensive income (loss)

Included in other comprehensive income (loss)

Included in other comprehensive income (loss)	Included in other comprehensive income (loss)	1		(2)
Purchases	Purchases	5		4
Issuances	Issuances	—		—
Settlements	Settlements	(8)		(4)
Balance at end of period	Balance at end of period	$	33	$	46
Total gains (losses) for the six month period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at end of period	Total gains (losses) for the six month period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at end of period	$	—	$	—

The following methods and assumptions were used to estimate the fair value of each class of financial instrument:

Derivative Assets and Liabilities

Our derivative financial instruments primarily include exchange-traded and over-the-counter contracts which are further described in Note 11: Derivative Financial Instruments. We record our derivative financial instruments at fair value using quoted market prices, adjusted where necessary for credit and non-performance risk and internal models that use readily observable market inputs as their basis, including current and forward market prices and rates. We classify these instruments in Level 2 when quoted market prices can be corroborated utilizing observable current and forward commodity market prices on active exchanges or observable market transactions.

Available-for-Sale Securities

Our investments in marketable debt securities are classified as available-for-sale and are reported at fair value based on pricing models and quoted market prices adjusted for credit and non-performance risk. Short-term investments with maturities of less than 12 months are included in Other current assets in the Consolidated Condensed Balance Sheets. All other marketable debt securities are included in Other Assets in the Consolidated Condensed Balance Sheets and have maturities ranging up to 4746 years.

We classify our investments in U.S. government, U.S. agency, certificates of deposit and commercial paper debt securities as Level 2 as fair value is generally estimated using discounted cash flow models that are primarily industry-standard models that consider various assumptions, including time value and yield curve as well as other readily available relevant economic measures. We classify certain corporate, asset-backed and other debt securities as Level 3 as there is limited activity or less observable inputs into valuation models, including current interest rates and estimated prepayment, default and recovery rates on the underlying portfolio or structured investment vehicle. Significant changes to assumptions or unobservable inputs in the valuation of our Level 3 instruments would not have a significant impact to our consolidated condensed financial statements.

The following table sets forth our available-for-sale securities’ amortized cost basis, fair value and unrealized gain (loss) by significant investment category (in millions):

April 1, 2023

October 1, 2022

Amortized
Cost Basis

Fair
Value

Unrealized
Gain (Loss)

Amortized
Cost Basis

Fair
Value

Unrealized
Gain (Loss)

March 30, 2024

September 30, 2023

Amortized
Cost Basis

Fair
Value

Unrealized
Gain (Loss)

Amortized
Cost Basis

Fair
Value

Unrealized
Gain (Loss)

Available-for-sale securities:

Debt securities:

U.S. treasury and agency

(4)

(5)

Corporate and asset-backed

(1)

(2)

Corporate and asset-backed

Unrealized holding gains (losses), net of tax, are excluded from earnings and reported in OCI until the security is settled or sold. On a quarterly basis, we evaluate whether losses related to our available-for-sale securities are due to credit or non-credit factors. Losses on debt securities where we have the intent, or will more than likely be required, to sell the security prior to recovery, would be recorded as a direct write-off of amortized cost basis through earnings. Losses on debt securities where we do not have the intent, or would not more than likely be required to sell the security prior to recovery, would be further evaluated to determine whether the loss is credit or non-credit related. Credit-related losses would be recorded through an allowance for credit losses through earnings and non-credit related losses through OCI.

1618

We consider many factors in determining whether a loss is credit-related, including the financial condition and near-term prospects of the issuer, borrower repayment characteristics for asset-backed securities, and our ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery. We recognized no direct write-offs or allowances for credit losses in earnings for the ~~three and~~ six months ended March 30, 2024, and April 1, ~~2023, and April 2, 2022.~~2023.

Deferred Compensation Assets

We maintain non-qualified deferred compensation plans for certain executives and other highly compensated team members. Investments are generally maintained within a trust and include money market funds, mutual funds and life insurance policies. The cash surrender value of the life insurance policies is invested primarily in mutual funds. The investments are recorded at fair value based on quoted market prices and are included in Other Assets in the Consolidated Condensed Balance Sheets. We classify the investments which have observable market prices in active markets in Level 1 as these are generally publicly-traded mutual funds. The remaining deferred compensation assets are classified in Level 2, as fair value can be corroborated based on observable market data. Realized and unrealized gains (losses) on deferred compensation are included in earnings.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

In addition to assets and liabilities that are recorded at fair value on a recurring basis, we record assets and liabilities at fair value on a nonrecurring basis. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges and, with respect to our equity investments without readily determinable fair values, recorded by applying the measurement alternative for which such investments are recorded at cost and adjusted for an observable price change in an orderly transaction for an identical or similar investment of the same issuer.

During the six months ended March 30, 2024, we recorded a fixed asset impairment charge of $25 million in Cost of Sales in the Consolidated Condensed Statements of Income as a result of our current intention to discontinue the use of certain productive assets at our Netherlands facility. The charge was derived using Level 3 inputs and was driven by management's estimate of the potential proceeds from the disposal of the assets. We did not have any other significant measurements of assets or liabilities at fair value on a nonrecurring basis subsequent to their initial recognition during the six months ended March 30, 2024 and April 1, 2023. In the six months ended April 2, 2022, we recognized gains of $37 million in Other, net in the Consolidated Condensed Statements of Income, based upon observable price changes. Equity investments without readily determinable fair values are measured using Level 3 inputs and are included in Other Assets in the Consolidated Condensed Balance Sheets.

Other Financial Instruments

Fair value of our debt is principally estimated using Level 2 inputs based on quoted prices for those or similar instruments. Fair value and carrying value for our debt are as follows (in millions):

April 1, 2023 October 1, 2022
Fair Value Carrying Value Fair Value Carrying Value
Total debt $ 8,518 $ 8,930 $ 7,762 $ 8,321


	March 30, 2024				September 30, 2023
	Fair Value		Carrying Value		Fair Value		Carrying Value
Total debt	$	10,663	$	10,960	$	8,693	$	9,506

NOTE 13: OTHER COMPREHENSIVE INCOME (LOSS)

The before and after-tax changes in the components of other comprehensive income (loss) are as follows (in millions):


		Three Months Ended												Six Months Ended
		April 1, 2023						April 2, 2022						April 1, 2023						April 2, 2022
		Before Tax		Tax		After Tax		Before Tax		Tax		After Tax		Before Tax		Tax		After Tax		Before Tax		Tax		After Tax
	Three Months Ended																													Three Months Ended					Six Months Ended
	March 30, 2024																											March 30, 2024			April 1, 2023			March 30, 2024			April 1, 2023
	Before Tax																									Before Tax	Tax	After Tax	Before Tax	Tax	After Tax	Before Tax	Tax	After Tax	Before Tax	Tax	After Tax

Derivatives accounted for as cash flow hedges:	Derivatives accounted for as cash flow hedges:
Derivatives accounted for as cash flow hedges:
Derivatives accounted for as cash flow hedges:
(Gain) loss reclassified to interest expense
(Gain) loss reclassified to interest expense
(Gain) loss reclassified to interest expense	(Gain) loss reclassified to interest expense	$	—	$	—	$	—	$	1	$	—	$	1	$	1	$	—	$	1	$	1	$	—	$	1

Investments:	Investments:

Investments:

Investments:

Unrealized gain (loss)

Unrealized gain (loss)

Unrealized gain (loss)	Unrealized gain (loss)	2		—		2		(4)		1		(3)		2		—		2		(5)		1		(4)

Currency translation:	Currency translation:
Currency translation:
Currency translation:

Translation adjustment		18		—		18		28		—		28		99		—		99		27		—		27
Translation adjustment(a)

Translation adjustment(a)

Translation adjustment(a)

Postretirement benefits:	Postretirement benefits:

Postretirement benefits:

Postretirement benefits:
Unrealized gain (loss)
Unrealized gain (loss)
Unrealized gain (loss)	Unrealized gain (loss)	1		—		1		3		(1)		2		1		—		1		5		(1)		4

Total other comprehensive income (loss)	Total other comprehensive income (loss)	$	21	$	—	$	21	$	28	$	—	$	28	$	103	$	—	$	103	$	28	$	—	$	28
Total other comprehensive income (loss)
Total other comprehensive income (loss)

(a) Before and after tax translation adjustment for the three and six months ended March 30, 2024 included $(7) million and $1 million of Comprehensive Income (Loss) Attributable to Noncontrolling Interests, respectively.

1719

NOTE 14: SEGMENT REPORTING

We operate in four reportable segments: Beef, Pork, Chicken, and Prepared Foods. We measure segment profit as operating income (loss). International/Other primarily includes our foreign operations in Australia, China, Malaysia, Mexico, the Netherlands, South Korea, Thailand and ~~Thailand,~~the Kingdom of Saudi Arabia, third-party merger and integration costs and corporate overhead related to Tyson New Ventures, LLC.

Beef

Beef includes our operations related to processing live fed cattle and fabricating dressed beef carcasses into primal and sub-primal meat cuts and case-ready products. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes sales from specialty products such as hides and variety meats, as well as logistics operations to move products through the supply chain.

Pork

Pork includes our operations related to processing live market hogs and fabricating pork carcasses into primal and sub-primal cuts and case-ready products. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes our live swine group, related specialty product processing activities and logistics operations to move products through the supply chain.

Chicken

Chicken includes our domestic operations related to raising and processing live chickens into, and purchasing raw materials for fresh, frozen and value-added chicken products, as well as sales from specialty products. Our value-added chicken products primarily include breaded chicken strips, nuggets, patties and other ready-to-fix or fully cooked chicken parts. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, convenience stores, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes logistics operations to move products through our domestic supply chain and the global operations of our chicken breeding stock subsidiary.

Prepared Foods

Prepared Foods includes our operations related to manufacturing and marketing frozen and refrigerated food products and logistics operations to move products through the supply chain. This segment includes brands such as Jimmy Dean®, Hillshire Farm®, Ball Park®, Wright®, State Fair®, as well as artisanal brands Aidells® and Gallo Salame®. Products primarily include ready-to-eat sandwiches, sandwich components such as flame-grilled hamburgers and Philly steaks, pepperoni, bacon, breakfast sausage, turkey, lunchmeat, hot dogs, flour and corn tortilla products, appetizers, snacks, prepared meals, ethnic foods, side dishes, meat dishes, breadsticks and processed meats. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, convenience stores, healthcare facilities, the military and other food processors, as well as to international export markets.

We allocate expenses related to corporate activities to the segments, except for third-party merger and integration costs and corporate overhead related to Tyson New Ventures, LLC, which are included in International/Other. Intersegment sales transactions, which were at market prices, are included in the segment sales in the table below.

Information on segments and a reconciliation to income before income taxes are as follows (in millions):


		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended										Three Months Ended			Six Months Ended
	March 30, 2024									March 30, 2024		April 1, 2023	March 30, 2024		April 1, 2023
Sales:	Sales:
Beef
Beef
Beef	Beef	$	4,617	$	5,034	$	9,340	$	10,036
Pork	Pork	1,421		1,565		2,950		3,191
Chicken	Chicken	4,430		4,086		8,693		7,976
Prepared Foods	Prepared Foods	2,422		2,393		4,960		4,726
International/Other	International/Other	634		565		1,246		1,115
Intersegment	Intersegment	(391)		(526)		(796)		(994)
Total Sales	Total Sales	$	13,133	$	13,117	$	26,393	$	26,050

1820


		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended										Three Months Ended			Six Months Ended
	March 30, 2024									March 30, 2024		April 1, 2023	March 30, 2024		April 1, 2023
Operating Income (Loss):	Operating Income (Loss):
Beef(a)	Beef(a)	$	—	$	638	$	166	$	1,594
Pork		(33)		59		(54)		223
Chicken(b)		(258)		198		(189)		338
Beef(a)
Beef(a)
Pork(b)
Chicken(c)
Prepared Foods	Prepared Foods	241		263		499		449
International/Other		1		(2)		(4)		7
International/Other(d)
Total Operating Income (Loss)	Total Operating Income (Loss)	(49)		1,156		418		2,611

Total Other (Income) Expense	Total Other (Income) Expense	81		69		114		114
Total Other (Income) Expense
Total Other (Income) Expense

Income (Loss) before Income Taxes	Income (Loss) before Income Taxes	$	(130)	$	1,087	$	304	$	2,497
Income (Loss) before Income Taxes
Income (Loss) before Income Taxes

(a) Beef segment results for the six months ended March 30, 2024 included a $45 million legal contingency accrual and $41 million of costs related to plant closures recognized in Cost of Sales. Beef segment results for the six months ended April 1, 2023 included $42 million of insurance proceeds, net of costs incurred, recognized in Cost of Sales.

(b) Pork segment results for the three and six months ended March 30, 2024 included $34 million of costs related to plant closures, recognized in Cost of Sales. Pork segment results for the six months ended March 30, 2024 included a $28 million legal contingency accrual, recognized in Cost of Sales.

(c) Chicken segment results for the six months ended March 30, 2024 included $39 million of costs related to plant closures and $24 million of insurance proceeds, net of costs incurred, recognized in Cost of Sales. Chicken segment results for the three and six months ended April 1, 2023 included $92 million of costs related to plant closures, recognized in Cost of Sales. Chicken segment results for the six months ended April 1, 2023 included $7 million of costs related to a fire at one of our production facilities, net of insurance proceeds, recognized in Cost of Sales. ~~Chicken segment~~

(d) International/Other results for the three and six months ended ~~April 1, 2023~~March 30, 2024 included ~~$92~~$54 million and $80 million, respectively, of costs, ~~related to plant closures, recognized in Cost~~net of ~~Sales. Additionally, Chicken segment results for the three months ended April 2, 2022 included $5 million of costs~~insurance proceeds, related to a fire at ~~one of~~ our production ~~facilities, net~~facility in the Netherlands and our current intention to discontinue the use of ~~insurance proceeds. Chicken segments results for the six months ended April 2, 2022 included $18 million of insurance proceeds, net of costs incurred,~~certain productive assets, recognized in Cost of Sales.

The following tables further disaggregate our sales to customers by major distribution channels (in millions):


		Three months ended April 1, 2023
		Retail(a)		Foodservice(b)		International(c)		Industrial and Other(d)		Intersegment		Total
	Three months ended March 30, 2024																	Three months ended March 30, 2024
	Retail(a)													Retail(a)	Foodservice(b)	International(c)	Industrial and Other(d)	Total External Customers	Intersegment	Total
Beef	Beef	$	2,134	$	1,191	$	610	$	560	$	122	$	4,617
Pork	Pork	416		114		300		339		252		1,421
Chicken	Chicken	1,964		1,660		248		541		17		4,430
Prepared Foods	Prepared Foods	1,433		898		51		40		—		2,422
International/Other	International/Other	—		—		634		—		—		634
Intersegment	Intersegment	—		—		—		—		(391)		(391)
Total	Total	$	5,947	$	3,863	$	1,843	$	1,480	$	—	$	13,133

Three months ended April 2, 2022
Retail(a)
Foodservice(b)
International(c)
Industrial and Other(d)
Intersegment Total
Beef $ 2,213 $ 1,264 $ 808 $ 603 $ 146 $ 5,034
Pork 430 122 267 401 345 1,565
Chicken 1,699 1,590 277 485 35 4,086
Prepared Foods 1,410 897 44 42 — 2,393
International/Other — — 565 — — 565
Intersegment — — — — (526) (526)
Total $ 5,752 $ 3,873 $ 1,961 $ 1,531 $ — $ 13,117


	Three months ended April 1, 2023
	Retail(a)		Foodservice(b)		International(c)		Industrial and Other(d)		Total External Customers		Intersegment		Total
Beef	$	2,134	$	1,191	$	610	$	560	$	4,495	$	122	$	4,617
Pork	416		114		300		339		1,169		252		1,421
Chicken	1,964		1,660		248		541		4,413		17		4,430
Prepared Foods	1,433		898		51		40		2,422		—		2,422
International/Other	—		—		634		—		634		—		634
Intersegment	—		—		—		—		—		(391)		(391)
Total	$	5,947	$	3,863	$	1,843	$	1,480	$	13,133	$	—	$	13,133

1921


		Six months ended April 1, 2023
		Retail(a)		Foodservice(b)		International(c)		Industrial and Other(d)		Intersegment		Total
	Six months ended March 30, 2024																	Six months ended March 30, 2024
	Retail(a)													Retail(a)	Foodservice(b)	International(c)	Industrial and Other(d)	Total External Customers	Intersegment	Total
Beef	Beef	$	4,268	$	2,320	$	1,307	$	1,207	$	238	$	9,340
Pork	Pork	874		231		632		689		524		2,950
Chicken	Chicken	3,845		3,266		494		1,054		34		8,693
Prepared Foods	Prepared Foods	2,938		1,836		107		79		—		4,960
International/Other	International/Other	—		—		1,246		—		—		1,246
Intersegment	Intersegment	—		—		—		—		(796)		(796)
Total	Total	$	11,925	$	7,653	$	3,786	$	3,029	$	—	$	26,393


		Six months ended April 2, 2022
		Retail(a)		Foodservice(b)		International(c)		Industrial and Other(d)		Intersegment		Total
	Six months ended April 1, 2023																	Six months ended April 1, 2023
	Retail(a)													Retail(a)	Foodservice(b)	International(c)	Industrial and Other(d)	Total External Customers	Intersegment	Total
Beef	Beef	$	4,431	$	2,500	$	1,664	$	1,165	$	276	$	10,036
Pork	Pork	908		258		571		799		655		3,191
Chicken	Chicken	3,332		3,150		498		933		63		7,976
Prepared Foods	Prepared Foods	2,735		1,826		90		75		—		4,726
International/Other	International/Other	—		—		1,115		—		—		1,115
Intersegment	Intersegment	—		—		—		—		(994)		(994)
Total	Total	$	11,406	$	7,734	$	3,938	$	2,972	$	—	$	26,050

(a) Includes external sales to consumer products and food retailers, such as grocery retailers, warehouse club stores and internet-based retailers.

(b) Includes external sales to ~~foodservice distributors,~~foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, convenience stores, healthcare facilities and the military.

(c) Includes external sales to international markets for internationally produced products or export sales of domestically produced products.

(d) Includes external sales to industrial food processing companies that further process our product to sell to end consumers and any remaining sales not included in the Retail, Foodservice or International categories.

NOTE 15: COMMITMENTS AND CONTINGENCIES

Commitments

We guarantee obligations of certain outside third parties, consisting primarily of grower loans, which are substantially collateralized by the underlying assets. The remaining terms of the underlying obligations cover periods up to 8 years, and the maximum potential amount of future payments as of ~~April 1, 2023,~~March 30, 2024, was not significant. The likelihood of material payments under these guarantees is not considered probable. At ~~April 1,~~March 30, 2024 and September 30, 2023, ~~and October 1, 2022,~~ no significant liabilities for guarantees were recorded.

We have cash flow assistance programs in which certain livestock suppliers participate. Under these programs, we pay an amount for livestock equivalent to a standard cost to grow such livestock during periods of low market sales prices. The amounts of such payments that are in excess of the market sales price are recorded as receivables and accrue interest. Participating suppliers are obligated to repay these receivables balances when market sales prices exceed this standard cost, or upon termination of the agreement. Our maximum commitment associated with these programs is limited to the fair value of each participating livestock supplier’s net tangible assets. The potential maximum commitment as of ~~April 1, 2023~~March 30, 2024 was approximately ~~$295~~$280 million. The total receivables under these programs were ~~$11~~$20 million and $6$12 million at ~~April 1,~~March 30, 2024 and September 30, 2023, ~~and October 1, 2022,~~ respectively. These receivables are included, net of allowance for uncollectible amounts, in Accounts Receivable in our Consolidated Condensed Balance Sheets. Even though these programs are limited to the net tangible assets of the participating livestock suppliers, we also manage a portion of our credit risk associated with these programs by obtaining security interests in livestock suppliers’ assets. After analyzing residual credit risks and general market conditions, we had a $3 million allowance for these programs’ estimated uncollectible receivables at April 1, 2023, and no allowance at October 1, 2022.

When constructing new facilities or making major enhancements to existing facilities, we will occasionally enter into incentive agreements with local government agencies in order to reduce certain state and local tax expenditures. These funds are generally considered restricted cash, which is reported in the Consolidated Condensed Balance Sheets in Other Assets. We had no deposits at ~~April 1, 2023~~March 30, 2024 and ~~October 1, 2022.~~September 30, 2023. Additionally, under certain agreements, we transfer the related assets to various local government entities and receive Industrial Revenue Bonds. We immediately lease the facilities from the local government entities and have an option to re-purchase the facilities for a nominal amount upon tendering the Industrial Revenue Bonds to the local government entities at various predetermined dates. The Industrial Revenue Bonds and the associated obligations for the leases of the facilities offset, and the underlying assets remain in property, plant and equipment. At ~~April 1, 2023,~~March 30, 2024, the total amount under these types of arrangements totaled ~~$797~~$802 million.

Contingencies

In the normal course of business, we are involved in various claims, lawsuits, investigations and legal proceedings, including those specifically identified below. Each quarter, we determine whether to accrue for loss contingencies based on our assessment of whether the potential loss is probable, reasonably possible or remote and to the extent a loss is probable, whether it is reasonably estimable. We record accruals in the Company’s Consolidated Financial Statements for matters that we conclude are probable and the financial impact is reasonably estimable. Regardless of the manner of resolution, frequently the most significant changes in the status of a matter may occur over a short time period, often following a lengthy period of little substantive activity. While these accruals reflect the Company’s best estimate of the probable loss for those matters as of the dates of those accruals, the recorded amounts may differ materially from the actual amount of the losses for those matters. Listed below are certain claims made against the Company for which the magnitude of the potential exposure could be material to the Company’s Consolidated Financial Statements. ~~There were no significant changes to the loss contingency accruals described below reflected in the Company’s Consolidated Condensed Statements of Income for the three and six months ended~~ ~~April 1, 2023.~~

Broiler Antitrust Civil Litigation

Beginning in September 2016, a series of ~~purported~~putative federal class action lawsuits styled In re Broiler Chicken Antitrust Litigation (the “Broiler Antitrust Civil Litigation”) were filed in the United States District Court for the Northern District of Illinois against us and certain of our poultry subsidiaries, as well as several other poultry processing companies. The operative complaints, which have been amended throughout the litigation, contain allegations that, among other things, assert that beginning in January 2008, the defendants conspired and combined to fix, raise, maintain, and stabilize the price of broiler chickens in violation of United States antitrust laws. The plaintiffs also allege that defendants “manipulated and artificially inflated a widely used Broiler price index, the Georgia Dock.” The plaintiffs further allege that the defendants concealed this conduct from the plaintiffs and the members of the putative classes. The plaintiffs seek treble damages, injunctive relief, pre- and post-judgment interest, costs, and attorneys’ fees on behalf of the putative classes. In addition, the complaints on behalf of the putative classes of indirect purchasers include causes of action under various state unfair competition laws, consumer protection laws, and unjust enrichment common laws. Since the original filing, certain putative class members have opted out of the matter and are proceeding with individual direct actions making similar claims, and others may do so in the future. The first trial in this matter, which involved claims brought by the Direct Purchaser Plaintiff Class and certain direct-action plaintiffs, began on September 12, 2023 and concluded with a jury verdict in favor of the defendant on October 25, 2023. The Company did not participate in the first trial because it had previously settled all of the claims brought by the Direct Purchaser Plaintiff Class. The second scheduled trial in this matter, which was to involve claims brought by the Commercial and Institutional Indirect Purchaser Class, was scheduled to begin in March 2024, but was cancelled because all claims brought by the Commercial and Institutional Indirect Purchaser Class were resolved before trial. The third scheduled trial in this matter, which will involve claims brought by the End-User Consumer Plaintiff Class, is scheduled to begin in September 2024. The Company will not participate in this trial because it has already settled all of the claims brought by the End-User Consumer Plaintiff Class.

Settlements

On January 19, 2021, we announced that we had reached agreements to settle certain class claims related to the Broiler Antitrust Civil Litigation. Settlement terms were reached with the putative Direct Purchaser Plaintiff Class, the putative Commercial and Institutional Indirect Purchaser Plaintiff Class and the putative End-User Consumer Plaintiff Class (collectively, the “Classes”). Under the terms of the settlements, we agreed to pay the Classes an aggregate amount of $221.5 million in settlement of all outstanding claims brought by the Classes. On February 23, 2021, March 22, 2021 and October 15, 2021, the Court granted preliminary approval of the settlements with the putative Direct Purchaser Plaintiff Class, the putative End-User Plaintiff Class and the putative Commercial and Institutional Indirect Purchaser Plaintiff Class, respectively. On June 29, 2021, December 20, 2021 and April 18, 2022, the Court granted final approval to the settlements with the Direct Purchaser Plaintiff Class, the End-User Plaintiff Class and the Commercial and Institutional Indirect Purchaser Plaintiff Class, respectively. The foregoing settlements do not settle claims made by plaintiffs who opt out of the Classes in the Broiler Antitrust Civil Litigation.

We are currently pursuing settlement discussions with the remaining opt-out plaintiffs with respect to the remaining claims. While we do not admit any liability as part of the settlements, we believe that the settlements ~~were~~we have entered into have been in the best interests of the Company and its shareholders to avoid the uncertainty, risk, expense and distraction of protracted litigation. During the first six months of fiscal 2023 and the full fiscal 2022, the Company reduced its total recorded legal contingency accrual by $11 million and $179 million, respectively, for amounts it had paid in connection with settlements related to this matter. Accordingly, at ~~April 1, 2023 and October 1, 2022, the legal contingency accrual for claims related to this matter was $111 million and $122 million, respectively.~~

Government Investigations

U.S. Department of Justice (“DOJ”) Antitrust Division. On June 21, 2019, the DOJ filed a motion to intervene and sought a limited stay of discovery in the Broiler Antitrust Civil Litigation, which the court granted in part. Subsequently, we received a grand jury subpoena from the DOJ seeking additional documents and information related to the chicken industry. On June 2, 2020, a grand jury for the District of Colorado returned an indictment charging four individual executives employed by two other poultry processing companies with conspiracy to engage in bid-rigging in violation of federal antitrust laws. On June 10, 2020, we announced that we uncovered information in connection with the grand jury subpoena that we had previously self-reported to the DOJ and have been cooperating with the DOJ as part of our application for leniency under the DOJ’s Corporate Leniency Program. Subsequently, the DOJ ~~has~~ announced indictments against additional individuals, as well as other poultry processing companies, alleging a conspiracy to fix prices and rig bids for broiler chicken products from at least 2012 until at least early 2019. In August 2021, the Company was granted conditional leniency by the DOJ for the matters we self-reported, which means that provided the Company continues to cooperate with the DOJ, neither the Company nor any of our cooperating employees will face prosecution or criminal fines or penalties. We continue to cooperate with the DOJ in connection with the ongoing federal antitrust investigation.

State Matters. The Offices of the ~~Attorney~~Attorneys General in New Mexico ~~Alaska~~ and ~~Washington~~Alaska have filed complaints against us and certain of our poultry subsidiaries, as well as several other poultry processing companies and Agri Stats, Inc., an information services provider (“Agri Stats”). The complaints are based on allegations similar to those asserted in the Broiler Antitrust Civil Litigation and allege violations of state antitrust, unfair trade practice, and unjust enrichment laws. In October 2022, we reached an agreement to settle all claims with the Washington Attorney General for $10.5 million for which the Company recorded an accrual in its Consolidated Financial Statements as of October 1, 2022, and on October 24, 2022, the Court entered the related consent decree resolving all claims in this matter between us and the Washington Attorney General. The Company paid the settlement during the first quarter of fiscal 2023. While we do not admit any liability as part of the settlement, we believe that the settlement was in the best interests of the Company and its shareholders to avoid the uncertainty, risk, expense and distraction of protracted litigation. The other claims with the Offices of Attorney General in New Mexico and Alaska remain outstanding. In addition, weWe are cooperating with various state governmental agencies and officials, including the Offices of the ~~Attorney~~Attorneys General for Florida and Louisiana, investigating or otherwise seeking information, testimony and/or documents, regarding the conduct alleged in the Broiler Antitrust Civil Litigation and related matters. ~~The~~On February 16, 2024, the Company ~~has not recorded any liability in connection with these matters as it does not believe~~and the State of Alaska filed a ~~loss is probable or reasonably estimable at this time in respect~~stipulation and proposed consent decree reflecting a settlement of the claims against the Company asserted by the Office of the Attorney General of Alaska. On April 19, 2024, the Company and the State of New Mexico ~~and Alaska Attorneys General and~~filed a proposed consent judgment reflecting a settlement of the ~~investigations~~claims against the Company asserted by the ~~Florida and Louisiana Attorneys General.~~

~~Broiler Chicken Grower Litigation~~

~~On January 27, 2017 and March 26, 2017, putative class action complaints were filed against us and certain~~Office of ~~our poultry subsidiaries, as well as several other vertically integrated poultry processing companies,~~the Attorney General of New Mexico. Both these proposed settlements remain subject to final court approval. While the Company believes it has meritorious defenses to the claims that have been made, we believe that these settlements are in the United States District Court for the Eastern District of Oklahoma styled In re Broiler Chicken Grower Litigation. The plaintiffs allege, among other things, that the defendants colluded not to compete for broiler raising services “with the purpose and effect of fixing, maintaining, and/or stabilizing grower compensation below competitive levels.” The plaintiffs also allege that the defendants “agreed to share detailed data on [g]rower compensation with one another, with the purpose and effect of artificially depressing [g]rower compensation below competitive levels.” The plaintiffs contend these alleged acts constitute violationsbest interests of the ~~Sherman Antitrust Act~~Company and ~~Section 202~~its shareholders to avoid the uncertainty, risk, expense and distraction of ~~the Grain Inspection, Packers and Stockyards Act of 1921.~~protracted litigation. The plaintiffs are seeking treble damages, pre- and post-judgment interest, costs, and attorneys’ fees on behalf of the putative class. Additional named plaintiffs filed similar class action complaints in federal district courts in North Carolina, Colorado, Kansas and California. All actions were subsequently consolidated in the Eastern District of Oklahoma. In June 2021, we reached an agreement to settle with the putative class of broiler chicken farmers all claims raised in this consolidated action on terms not material to the Company for which the Company recorded an accrual in ~~its Consolidated Financial Statements as~~the fourth quarter of ~~October 2, 2021.~~fiscal 2023 for the estimated probable losses that it expects to incur for this matter.

As of March 30, 2024 and September 30, 2023, the legal contingency accrual for claims related to the Broiler Antitrust Civil Litigation matters described above was $103 million and $184 million, respectively. The ~~Court granted preliminary approval~~decrease in the accrual is due to payments made during the first six months of fiscal 2024. The Company does not believe that a range of possible loss, if any, in excess of the ~~settlement on August 23, 2021 and final approval on February 18, 2022, and the Company paid the settlement during fiscal 2022.~~recorded accrual is reasonably estimable at this time.

Broiler Chicken Grower Investigation

In October 2022, the DOJ’s Antitrust Division opened a civil investigation into broiler chicken grower contracts and alleged non-competitive practices involving performance-based ~~compensation.~~compensation sharing for the purpose of stabilizing compensation below competitive levels. We continue to cooperate with the investigation. The Company has not recorded any liability for this matter as it does not believe a loss is probable, nor does it believe that a range of possible loss, if any, is reasonably estimable at this time.

Pork Antitrust Litigation

Beginning June 18, 2018, a series of putative class action complaints were filed against us and certain of our pork subsidiaries, as well as several other pork processing companies, in the United States District Court for the District of Minnesota styled In re Pork Antitrust Litigation (the “Pork Antitrust Civil Litigation”). The plaintiffs allege, among other things, that beginning in January 2009, the defendants conspired and combined to fix, raise, maintain, and stabilize the price of pork and pork products in violation of federal antitrust laws. The complaints on behalf of the putative classes of indirect purchasers also include causes of action under various state unfair competition laws, consumer protection laws, and unjust enrichment common laws. The plaintiffs seek treble damages, injunctive relief, pre- and post-judgment interest, costs, and attorneys’ fees on behalf of the putative classes. Since the original filing, certain putative class members have opted out of the matter and are proceeding with individual direct actions making similar claims, and others may do so in the future. The Company has not recorded any liability for this matter as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because the Company believes that it has valid and meritorious defenses against the allegations.

The Offices of the Attorney General in New Mexico and Alaska have filed complaints against us and certain of our pork subsidiaries, as well as several other pork processing companies and Agri Stats. The complaints are based on allegations similar to those asserted in the Pork Antitrust Civil Litigation and allege violations of state antitrust, unfair trade practice, and unjust enrichment laws based on allegations of conspiracies to exchange information and manipulate the supply of pork. ~~The~~Because the Company believes that it has valid and meritorious defenses against the allegations, we have not recorded any liability for the foregoing matters as ~~it does~~we do not believe a loss is probable, ornor do we believe that a range of possible loss, if any, is reasonably estimable at this ~~time because the proceedings are in preliminary stages.~~

time.

Beef Antitrust Litigation

On April 23, 2019, a putative class action complaint was filed against us and our beef and pork subsidiary, Tyson Fresh Meats, Inc. (“Tyson Fresh Meats”), as well as other beef packer defendants, in the United States District Court for the Northern District of Illinois. The plaintiffs allege that the defendants engaged in a conspiracy from January 2015 to the present to reduce fed cattle prices in violation of federal antitrust laws, the Grain Inspection, Packers and Stockyards Act of 1921, and the Commodities Exchange Act by periodically reducing their slaughter volumes so as to reduce demand for fed cattle, curtailing their purchases and slaughters of cash-purchased cattle during those same periods, coordinating their procurement practices for fed cattle settled on a cash basis, importing foreign cattle at a loss so as to reduce domestic demand, and closing and idling plants. In addition, the plaintiffs also allege the defendants colluded to manipulate live cattle futures and options traded on the Chicago Mercantile Exchange. The plaintiffs seek, among other things, treble monetary damages, punitive damages, restitution, and pre- and post-judgment interest, as well as declaratory and injunctive relief. Other similar lawsuits were filed by cattle ranchers in other district courts which were then transferred to the United States District Court for the District of Minnesota and consolidated and styled as In Re Cattle Antitrust Litigation. On February 18, 2021, we moved to dismiss the amended complaints, and on September 14, 2021, the court granted the motion with respect to certain state law claims but denied the motion with respect to the plaintiffs’ federal antitrust claims. The Company has not recorded any liability for this matter as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because the Company believes that it has valid and meritorious defenses against the allegations and because the classes have not yet been defined or certified by the court.

On April 26, 2019, a putative class of indirect purchasers filed a class action complaint against us, other beef packers, and Agri Stats in the United States District Court for the District of Minnesota. The plaintiffs allege that the packer defendants conspired to reduce slaughter capacity by closing or idling plants, limiting their purchases of cash cattle, coordinating their procurement of cash cattle, and reducing their slaughter numbers so as to reduce beef output, all in order to artificially raise prices of beef. The plaintiffs seek, among other things, damages under state antitrust and consumer protection statutes and the common law of approximately 30 states, as well as injunctive relief. The indirect consumer purchaser litigation is styled Peterson v. JBS USA Food Company Holdings, et al. Additional complaints have been filed on behalf of a putative class of direct purchasers of beef containing allegations of violations of Section 1 of the Sherman Act based on an alleged conspiracy to artificially fix, raise, and stabilize the wholesale price for beef, as well as on behalf of a putative class of commercial and institutional indirect purchasers of beef containing allegations of violations of Section 1 of the Sherman Act, various state antitrust laws and unjust enrichment based on an alleged conspiracy to artificially inflate the price for beef. On February 18, 2021, we moved to dismiss the plaintiffs’ amended complaints, and on September 14, 2021, the court granted the motion with respect to certain state law claims but denied the motion with respect to the plaintiffs’ federal antitrust claims. Since the original filing, certain putative class members have opted out of the matter and are proceeding with individual direct actions making similar claims, and others may do so in the future. The Company has not recorded any liability for this matter as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because the Company believes that it has valid and meritorious defenses against the allegations and because the classes have not yet been defined or certified by the court.

On February 18, 2022, a putative class action was commenced against us, Tyson Fresh Meats, and other beef packer defendants in the Supreme Court of British Columbia styled Bui v. Cargill, Incorporated et al. The plaintiff alleges that the defendants conspired to fix, maintain, increase, or control the price of beef, as well as to fix, maintain, control, prevent, or lessen the production or supply of beef by agreeing to reduce the number of cattle slaughtered, reduce slaughter capacity, refrain from increasing slaughter and beef processing capacity, limit purchases of cattle on the cash market, and coordinate purchases of and bids for cattle to lower the supply of fed cattle. The plaintiff advances causes of action under the Competition Act, civil conspiracy, unjust enrichment, and the Civil Code of Québec. The plaintiff seeks to certify a class comprised of all persons or entities in Canada who directly or indirectly purchased beef in Canada, either for resale or for their own consumption between January 1, 2015, and the present and seeks declarations regarding the alleged conspiracy, general damages, aggravated, exemplary, and punitive damages, injunctive relief, costs, and interest. On March 24, 2022, a putative class action was commenced against the same defendants in the Superior Court of Québec styled De Bellefeuille v. Cargill, Incorporated et al. The plaintiff is making substantially the same allegations as those made in the British Columbia action. On behalf of the putative class of persons who purchased beef in Québec since January 1, 2015, the plaintiff is seeking compensatory damages, costs of investigation and interest. The Company has not recorded any liability for the foregoing matters as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because the proceedings are in preliminary stages.

On October 31, 2022, a class action complaint was filed on behalf of putative classes of indirect cattle producers against us, Tyson Fresh Meats, and other beef packer defendants in the United States District Court for the District of Kansas. The plaintiffs allege that the defendants engaged in a conspiracy in violation of Section 1 of the Sherman Act, the Packers and Stockyards Act of 1921 and various state unfair competition and consumer protection laws from January 2015 to the present to reduce the price of cows, cattle, calves, steers or heifers by periodically reducing their slaughter volumes so as to reduce demand for fed cattle, curtailing their purchases and slaughters of cash-purchased cattle during those same periods, coordinating their procurement practices for fed cattle settled on a cash basis, importing foreign cattle at a loss so as to reduce domestic demand, and closing and idling plants. The plaintiffs seek, among other things, treble monetary damages, punitive damages, restitution, and pre- and post-judgment interest under state antitrust and consumer protection statutes and the common law of approximately 33 states, as well as declaratory and injunctive relief. The indirect producer litigation is styled ~~Sprecht~~Specht et. al. v. Tyson, Inc., et al. In November 2022, the case was transferred and consolidated with In re Cattle and Beef Antitrust Litigation, MDL No. 3031. On February 3, 2023, we moved to dismiss the complaint, and the court granted the motion on August 17, 2023 but later permitted the plaintiffs to amend their complaint. On November 21, 2023, we moved to dismiss the amended complaint, and that motion remains pending. The Company has not recorded any liability for this matter as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because the Company believes that it has valid and meritorious defenses against the allegations and because the classes have not yet been defined or certified by the court.

On May 22, 2020, December 23, 2020 and October 29, 2021, we received civil investigative demands (“CIDs”) from the DOJ’s Civil Antitrust Division. The CIDs request information related to the fed cattle and beef packing markets. We have been cooperating with the DOJ with respect to the CIDs. The Offices of the Attorney General for multiple states are participating in the investigation and coordinating with the DOJ. The Company has not recorded any liability for this matter as it does not believe a loss is probable, nor does it believe that a range of possible loss, if any, is reasonably estimable at this time.

We received a subpoena dated April 21, 2022 from the New York Attorney General’s Bureau of Consumer Frauds & Protection seeking information regarding our sales, prices and production costs of beef, pork and chicken products. After we had made an initial production of information, we were unable to agree with the New York Attorney General's office on the appropriate scope of the subpoena. Following initial litigation on the scope of the subpoena, we are reviewing and ~~as of August 3, 2022, the parties are litigating the issue before a New York state court.~~producing documents.

Wage Rate Litigation

On August 30, 2019, a putative class of non-supervisory production and maintenance employees at chicken processing plants in the continental United States filed class action complaints against us and certain of our subsidiaries, as well as several other poultry processing companies, in the United States District Court for the District of Maryland. The plaintiffs allege that the defendants directly and through a wage survey and benchmarking service exchanged information regarding labor rates in an effort to depress and fix the rates of wages for non-supervisory production and maintenance workers in violation of federal antitrust laws. The plaintiffs seek, among other things, treble monetary damages, punitive damages, restitution, and pre- and post-judgment interest, as well as declaratory and injunctive relief. Additional lawsuits making similar allegations were consolidated including an amended consolidated complaint containing additional allegations concerning turkey processing plants naming additional defendants. We moved to dismiss the amended consolidated complaint. On September 16, 2020, the court dismissed claims against us and certain other defendants without prejudice because the complaint improperly grouped together corporate subsidiaries. The court otherwise denied the defendants’ motions to dismiss and sustained claims based on alleged conspiracies to fix wages and exchange information against five other defendants. The plaintiffs filed a second amended consolidated complaint on November 2, 2020. We moved to dismiss the complaint on December 18, 2020 based on a lack of standing to assert claims on behalf of the purported class. The court denied the motion to dismiss on March 10, 2021. On February 16, 2022, the plaintiffs filed a third amended consolidated complaint naming additional poultry processors as defendants and expanding the scope of the claims to include employees at hatcheries and feed mills. We moved to dismiss the claims related to hatchery and feed mill employees. The court denied the motion to dismiss on July 19, 2022. InAs of March 30, 2024 and September 30, 2023, the ~~third quarter of fiscal 2021, the Company recorded an~~legal contingency accrual for ~~the estimated probable losses that it expects~~claims related to ~~incur for~~ this matter was $60 million. The Company does not believe that a range of possible loss, if any, in excess of the ~~Company’s Consolidated Condensed Financial Statements. There was no change to~~recorded accrual is reasonably estimable at this time, because the ~~accrual in fiscal 2022~~classes have not yet been defined or certified by the ~~first six months of fiscal 2023.~~court.

The DOJ’s Antitrust Division has opened a civil investigation into human resources at several poultry companies. We are cooperating with the investigation. The Company has not recorded any liability for this matter as it does not believe a loss is probable, nor does it believe that a range of possible loss, if any, is reasonably estimable at this time.

On November 11, 2022, a putative class of employees at beef-processing and pork-processing plants in the continental United States filed a class action complaint against us and certain of our subsidiaries, as well as several other beef-processing and pork-processing companies, in the United States District Court for the District of Colorado. The plaintiffs allege that the defendants directly and through a wage survey and benchmarking service exchanged information regarding labor rates in an effort to depress and fix the rates of wages for employees in violation of federal antitrust laws. The plaintiffs seek, among other things, treble monetary damages, punitive damages, restitution, and pre- and post-judgment interest, as well as declaratory and injunctive relief. ~~The Company has not recorded any liability for this matter as it does not believe~~On February 17, 2023, we moved to dismiss the complaint, and on September 27, 2023, the court denied our motion.

On December 22, 2023, after a ~~loss is probable or reasonably estimable at this time because~~mediation between the parties, the Company ~~believes that it has~~and the putative class plaintiffs reached an in-principle agreement to settle. While we believe we have valid and meritorious defenses against the allegations, we believe that the proposed settlement is in the best interests of the Company and ~~because~~its shareholders to avoid the ~~case~~uncertainty, risk, expense and distraction of protracted litigation. Under the terms of the proposed settlement, the Company agreed to pay the putative class an aggregate amount of $72.5 million. The settlement agreement remains atsubject to court approval. If the ~~pleading stage and~~court grants final approval to the ~~classes have not yet been defined or certified by~~settlement, it will completely resolve all claims made against the ~~court.~~

Company in this matter. In the first quarter of fiscal 2024, the Company recorded an accrual for the $72.5 million proposed settlement which remains accrued as of
March 30, 2024

Other Matters

Our subsidiary, The Hillshire Brands Company (formerly named Sara Lee Corporation), is a party to a consolidation of cases filed by individual complainants with the Republic of the Philippines, Department of Labor and Employment and the National Labor Relations Commission (“NLRC”) from 1998 through July 1999. The complaint was filed against Aris Philippines, Inc., Sara Lee Corporation, Sara Lee Philippines, Inc., Fashion Accessories Philippines, Inc., and Attorney Cesar C. Cruz (collectively, the “respondents”). The complaint alleges, among other things, that the respondents engaged in unfair labor practices in connection with the termination of manufacturing operations in the Philippines in 1995 by Aris Philippines, Inc., a former subsidiary of The Hillshire Brands Company. In late 2004, a labor arbiter ruled against the respondents and awarded the complainants approximately ~~$64~~$61 million in damages and fees. From 2004 through 2014, the parties filed numerous appeals, motions for reconsideration and petitions for review, certain of which remained outstanding for several years. On December 15, 2016, we learned that the NLRC rendered its decision on November 29, 2016, regarding the respondents’ appeals from the labor arbiter’s 2004 ruling in favor of the complainants. The NLRC increased the award for 4,922 of the total 5,984 complainants to approximately ~~$273~~$264 million. However, the NLRC approved a prior settlement reached with the group comprising approximately 18% of the class of 5,984 complainants, pursuant to which The Hillshire Brands Company agreed to pay each settling complainant approximately ~~$1,250.~~$1,200. The parties filed numerous appeals, motions for reconsideration and petitions for review related to the NLRC award and settlement payment. The Court of Appeals subsequently vacated the NLRC’s award on April 12, 2018. Complainants have filed motions for reconsideration with the Court of Appeals which were denied. Claimants have since filed petitions for writ of certiorari with the Supreme Court of the Philippines, which has been accepted. The Company continues to maintain an accrual in an immaterial amount for estimated probable losses for this matter in the Company’s Consolidated Financial Statements. The Company does not believe that a range of possible loss, if any, in excess of the recorded accrual is reasonably estimable at this time.

Various claims have been asserted against the Company, its subsidiaries, and its officers and agents by, and on behalf of, team members who claim to have contracted COVID-19 in our facilities. The Company has not recorded any liability for these matters as it does not believe a loss is probable, ornor does it believe that a range of possible loss, if any, is reasonably estimable at this time, because it believes the allegations in the claims are without ~~merit.~~merit and that the Company has valid and meritorious defenses against the allegations.

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

OBJECTIVE

The following discussion provides an analysis of the Company’s financial condition, cash flows and results of operations from management’s perspective and should be read in conjunction with the consolidated condensed financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q and within the Company’s Annual Report on Form 10-K filed for the fiscal year ended ~~October 1, 2022.~~September 30, 2023. Our objective is to also provide discussion of events and uncertainties known to management that are reasonably likely to cause reported financial information not to be indicative of future operating results or of future financial condition and to offer information that provides understanding of our financial condition, cash flows and results of operations.

RESULTS OF OPERATIONS

Description of the Company

We are one of the world’s largest food companies and a recognized leader in protein. Founded in 1935 by John W. Tyson and grown under four generations of family leadership, the Company has a broad portfolio of products and brands ~~like~~including Tyson®, Jimmy Dean®, Hillshire Farm®, Ball Park®, Wright®, Aidells®, ibp® and State Fair®. Some of the key factors influencing our business are customer demand for our products; the ability to maintain and grow relationships with customers and introduce new and innovative products to the marketplace; accessibility of international markets; market prices for our products; the cost and availability of live cattle and hogs, raw materials and feed ingredients; availability of team members to operate our production facilities; and operating efficiencies of our facilities.

Overview

General

Sales ~~were relatively flat~~decreased slightly in the second quarter and ~~grew 1%~~were flat in the first six months of fiscal ~~2023 largely due to improved~~2024 as decreased sales ~~volume~~ in our Chicken and Prepared Foods segments were largely offset by increased sales in our Beef and Pork segments. We ~~incurred an~~recorded operating ~~loss~~income of ~~$49~~$312 million for the second quarter of fiscal ~~2023~~2024 as compared to an operating ~~income~~loss of ~~$1,156~~$49 million in the second quarter of fiscal ~~2022~~2023 as we experienced ~~lower~~higher operating income ~~across all segments. Operating income of $418 million for the first six months of fiscal 2023 was down 84% compared to the first six months of fiscal 2022 as we experienced~~in our Chicken and Pork segments, partially offset by lower operating income in our Beef ~~Pork~~ and ~~Chicken segments, partially offset~~Prepared Foods segments. During the second quarter and first six months of fiscal 2024, we incurred higher performance-based compensation costs of $104 million and $200 million, respectively, driven by improved consolidated results. Due to the nature of our performance-based compensation plans, our segments were primarily impacted based on their relative number of eligible team members, and thus, our Chicken and Prepared Foods segments incurred a greater proportion of the total costs.

Additionally, in the second quarter of fiscal 2024, our operating income was impacted by $54 million of costs related to a production facility fire and our current intention to discontinue the use of certain productive assets in ~~our Prepared Foods segment.~~the Netherlands and $39 million in plant closure charges. In the second quarter of fiscal 2023, our operating income was impacted by $22 million of restructuring and related charges and $92 million of charges related to plant closures. Operating income of $543 million for the first six months of fiscal 2024 was up 30% compared to the first six months of fiscal 2023 as we experienced higher operating income in our Chicken and Pork segments, partially offset by lower operating income for our Beef and Prepared Foods segments. In the first six months of fiscal 2024, our operating income was impacted by $114 million of plant closure charges, $80 million of costs related to a production facility fire and our current intention to discontinue the use of certain productive assets in the Netherlands, $73 million in legal contingency accruals and $31 million of restructuring and related charges, partially offset by the benefit of $24 million of insurance proceeds, net of costs incurred related to facility fires. Additionally, in the six months ended April 1, 2023, our operating income was impacted by $43 million of restructuring and related charges and benefited from $35 million of insurance proceeds net of costs, related to facility fires. Operating income in the second quarter of fiscal 2022 was impacted by $5 million of production facility fire costs, net of insurance proceeds. In the six months ended April 2, 2022, our operating income was impacted by $18 million of insurance proceeds, net of costs.

Market Environment

According to the United States Department of Agriculture, domestic protein production (beef, pork, chicken and turkey) ~~increased approximately 1%~~decreased slightly in the second quarter of fiscal ~~2023~~2024 as compared to the same period in fiscal ~~2022. All segments~~2023. The Beef segment experienced ~~inflation~~limited supply of market-ready cattle in ~~operating~~the second quarter of fiscal 2024 as well as increased cattle costs. Additionally, uncertainty exists regarding the timing of the anticipated cattle herd rebuilding. The Pork segment experienced sufficient supply and reduced hog costs. The Chicken segment experienced reduced feed ingredient costs. The Prepared Foods segment experienced decreased raw material costs ~~especially in labor and certain materials, however, the rate of inflation is starting~~primarily due to ~~decrease and protein prices are beginning to level off. We continue to pursue recovery of increased input costs through pricing.~~lower meat costs. Additionally, the conflict between Ukraine and Russia has led to economic sanctions against Russia and certain regions of Ukraine and Belarus. ~~As of April 1, 2023, the impact of this conflict has not had a material direct impact on our financial performance.~~ However, the conflict is still ongoing and there are many risks and uncertainties in relation to the conflict that are outside of our control. Furthermore, the ongoing conflict in the Middle East escalated during the first six months of fiscal 2024 creating economic and political uncertainty within the region. As of March 30, 2024, the impact of these conflicts have not had a material direct impact on our financial performance. If ~~the conflict escalates~~these conflicts escalate further, impact additional regions or ~~if additional~~ countries, ~~join the conflict and~~or additional economic sanctions are imposed, it could have a material impact on our business operations and financial performance. The Beef segment experienced reduced supply of market-ready cattle and increased live cattle costs. The Pork segment experienced sufficient supply, despite herd health challenges in the industry, and reduced live hog costs. The Chicken segment experienced increased feed ingredient and other input costs, challenging market conditions impacting sales pricing, and challenging export markets associated with Avian Influenza. The Prepared Foods segment experienced increased costs largely due to the impacts of an inflationary environment.

The Federal Reserve has increased interest rates, and ~~it is anticipated that~~may continue to increase interest rates ~~will continue to rise~~or maintain elevated interest rates in the near term. Our direct exposure to ~~rising~~elevated interest rates is somewhat tempered given our strong liquidity position in addition to our current debt structure in which most of our borrowings have fixed interest rates. At ~~April 1, 2023,~~March 30, 2024, we had ~~$2.2~~$4.4 billion of liquidity and our current debt was ~~$1.1 billion.~~$1.3 billion, which we intend to repay with the remaining proceeds from our $1.5 billion of senior notes issued in March 2024. Should we need to issue additional debt or borrow under our existing revolving credit facility, we may be exposed to higher interest rates than our current outstanding borrowings. On May 3, 2023, we entered into two new term loan facilities totaling $1.75 billion to refinance our commercial paper program and for general liquidity purposes. A more detailed description of our new term loan facilities is set forth in Part II, Item 5 of this Quarterly Report on Form 10-Q.

~~COVID-19~~

We continue to proactively monitor and respond to the evolving nature of the COVID-19 pandemic and its impact to our global business. Our ongoing COVID-19 task force was formed for the primary purposes of maintaining the health and safety of our team members, ensuring our ability to operate our processing facilities and maintaining the liquidity of our business. We have experienced and continue to experience multiple challenges related to the pandemic. The most significant challenge we face is the availability of team members to operate our production facilities as our production facilities continue to experience varying levels of absenteeism. The health and safety of our team members remains our top priority, and we continue to provide a variety of health and safety resources and services to team members and their family members. Additionally, we have experienced some challenges in our supply chain such as volatility of inputs, availability of shipping containers and port congestion. These challenges impacted our operating costs, but generally, we experienced lower direct incremental costs associated with COVID-19 in the second quarter and first six months of fiscal 2023 as compared to previous fiscal years. The long-term impacts of COVID-19 remain uncertain and will depend on future developments, including the duration and spread of potential future COVID-19 variants and the resurgence of existing COVID-19 variants, and related actions taken by federal, state and local government officials to prevent and manage disease spread, and effectively distribute and administer vaccinations, all of which contain some level of uncertainty and cannot be easily predicted.

Margins

Our total operating margin was ~~(0.4)%~~2.4% in the second quarter of fiscal ~~2023.~~2024. Operating margins by segment were as follows:

•Beef – ~~0.0%~~(0.7)%

•Pork – ~~(2.3)~~(0.1)%

•Chicken – ~~(5.8)%~~3.9%

•Prepared Foods – ~~10.0%~~9.6%

Strategy

We are a world-class food company and recognized leader in protein. Our strategy is to ~~sustainably feed~~deliver margins in the ~~world with the fastest growing~~core protein ~~brands. We intend to achieve our strategy as we: grow our~~ business by driving efficiencies and valuing-up offerings to better serve consumers; grow branded portfolio by innovating new occasions, categories and channels; and scale in international markets by delivering ~~superior value to consumers and customers; deliver fuel for~~profitable value-added food offerings in high growth ~~and returns through commercial, operational and financial excellence; and sustain our Company and our world for future generations.~~

Beginning in fiscal 2022, we launched a new productivity program, which is designed to drive a better, faster and more agile organization that is supported by a culture of continuous improvement and faster decision-making. The execution of this program is supported by a program management office that ensures delivery of key project milestones and reports on savings achievements connected with the three pillars of the program. The first pillar is operational and functional excellence, which includes functional efficiency efforts in Finance, HR and Procurement focused on applying best practices to reduce costs. The second pillar is the use of new digital solutions like artificial intelligence and predictive analytics to drive efficiency in operations, supply chain planning, logistics and warehousing. The third pillar is automation, which will leverage automation and robotics technologies to automate difficult and higher turnover positions. We expect the productivity savings to be recognized in each of our reportable segments as they benefit from the achievements connected with the three pillars of the program. At this time, we do not anticipate costs associated with this program to be material and capital expenditures associated with automation and other activities are included in our capital expenditure expectations. We were targeting $1 billion in productivity savings by the end of fiscal 2024 relative to a fiscal 2021 cost baseline. We realized more than $700 million of productivity savings in fiscal 2022, which partially offset the impacts of inflationary market conditions, and we have surpassed our aggregate $1 billion target as of the end of the second quarter of fiscal 2023, more than a year ahead of our plan.categories.

In the fourth quarter of fiscal 2022, the Company approved a restructuring program, the 2022 Program, which is expected to improve business performance, increase collaboration, enhance team member agility, enable faster decision-making and reduce redundancies. In conjunction with the 2022 Program, the Company is bringing together all its corporate team members from the Chicago, Downers Grove and Dakota Dunes area corporate locations to its world headquarters in Springdale, Arkansas, through a phased relocation commencing in early calendar year 2023. We recognized $1 million and $22 million of pretax charges in the three months ended March 30, 2024 and April 1, 2023, respectively, and $31 million and $43 million of pretax charges in the ~~three months and~~ six months ended March 30, 2024 and April 1, 2023, respectively, associated with the 2022 Program consisting of severance related costs, relocation and related costs, accelerated depreciation, contract and lease termination and professional and other fees. The Company currently anticipates the 2022 Program will result in cumulative pretax charges of approximately ~~$271~~$228 million. As the Company continues to evaluate its business strategies and long-term growth targets, additional restructuring activities may occur. The following tables set forth the pretax impact of restructuring and related charges in the Consolidated Condensed Statements of Income and the pretax impact by our reportable segments. For further description refer to Part I, Item 1, Notes to the Consolidated Condensed Financial Statements, Note 6: Restructuring and Related Charges (in millions).

Three Months Ended Six Months Ended
April 1, 2023 April 1, 2023
Cost of Sales $ (4) $ 4
Selling, General and Administrative 26 39
Total Restructuring and related charges, pretax $ 22 $ 43

Three Months Ended Six Months Ended 2022 Program charges to date Total estimated
April 1, 2023 April 1, 2023 April 1, 2023 2022 Program charges
Beef $ 8 $ 13 $ 29 $ 67
Pork 2 4 9 24
Chicken — 1 7 8
Prepared Foods 11 19 55 159
International/Other 1 6 9 13
Total Restructuring and related charges, pretax $ 22 $ 43 $ 109 $ 271



	Three Months Ended				Six Months Ended
	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Cost of Sales	$	(3)	$	(4)	$	—	$	4
Selling, General and Administrative	4		26		31		39
Total Restructuring and related charges, pretax	$	1	$	22	$	31	$	43

2728



	Three Months Ended				Six Months Ended				2022 Program charges to date		Total estimated
	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023		March 30, 2024		2022 Program charges
Beef	$	—	$	8	$	4	$	13	$	53	$	54
Pork	—		2		1		4		17		17
Chicken	(2)		—		2		1		24		25
Prepared Foods	3		11		24		19		109		111
International/Other	—		1		—		6		18		21
Total Restructuring and related charges, pretax	$	1	$	22	$	31	$	43	$	221	$	228

Summary of Results

Sales


in millions	in millions	Three Months Ended					Six Months Ended					in millions	Three Months Ended			Six Months Ended
		April 1, 2023			April 2, 2022		April 1, 2023			April 2, 2022
	March 30, 2024													March 30, 2024	April 1, 2023		March 30, 2024	April 1, 2023
Sales	Sales	$	13,133		$	13,117	$	26,393		$	26,050
Change in sales volume	Change in sales volume	3.3		%			2.1		%
Change in average sales price	Change in average sales price	(3.2)		%			(0.8)		%
Change in average sales price
Change in average sales price
Sales growth	Sales growth	0.1		%			1.3		%
Sales growth
Sales growth

Second quarter – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Sales Volume – Sales were ~~positively~~negatively impacted by ~~an increase~~a decrease in sales volume, which accounted for ~~an increase of $434~~a $193 million decrease in sales driven by ~~increased volumes~~decreased sales volume in our Chicken ~~and Pork segments~~segment, partially offset by ~~decreased volumes~~increased sales volume in our Beef, ~~segment due to reduced domestic availability of live cattle~~Pork and ~~in our~~ Prepared Foods ~~segment due to uneven foodservice recovery.~~segments.

•Average Sales Price – Sales were ~~negatively~~positively impacted by ~~lower~~higher average sales prices, which accounted for ~~a decrease~~an increase of ~~$418~~$132 million, driven by ~~reduced~~increased pricing in our Beef and Pork segments, partially offset by ~~higher~~lower average sales prices in our Chicken and Prepared Foods segments.

Six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Sales Volume – Sales were ~~positively~~negatively impacted by ~~an increase~~a decrease in sales volume, which accounted for ~~an increase of $539~~a $195 million decrease in sales driven by ~~increased volumes~~decreased sales volume in our ~~Chicken~~Beef and ~~Prepared Foods~~Chicken segments, partially offset by ~~decreased volumes~~increased sales volume in our Pork ~~segment as a result of balancing our supply with customer demand during a period of margin compression.~~and Prepared Foods segments.

•Average Sales Price – Sales were ~~negatively~~positively impacted by ~~lower~~higher average sales prices, which accounted for ~~a decrease~~an increase of ~~$196~~$193 million, driven by ~~reduced~~increased pricing in our Beef ~~and Pork segments,~~segment, partially offset by ~~higher~~lower average sales prices in our Pork, Chicken and Prepared Foods segments.

Cost of Sales


in millions	in millions	Three Months Ended						Six Months Ended						in millions	Three Months Ended						Six Months Ended
		April 1, 2023			April 2, 2022			April 1, 2023			April 2, 2022
	March 30, 2024																March 30, 2024			April 1, 2023				March 30, 2024			April 1, 2023
Cost of sales	Cost of sales	$	12,606		$	11,382		$	24,898		$	22,300
Gross profit	Gross profit	527			1,735			1,495			3,750
Cost of sales as a percentage of sales	Cost of sales as a percentage of sales	96.0		%	86.8		%	94.3		%	85.6		%	Cost of sales as a percentage of sales	93.4	%		96.0	%			93.6	%		94.3	%

Second quarter – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Cost of sales ~~increased $1,224~~decreased $400 million. ~~Higher~~Lower sales volume ~~increased~~decreased cost of sales ~~$373~~by $182 million while ~~higher~~lower input cost per pound ~~increased~~decreased cost of sales ~~$851~~by $218 million.

•The ~~$851~~$218 million impact of ~~higher~~lower input cost per pound was impacted by:

•Increase in ~~live~~ cattle costs of approximately ~~$305~~$325 million in our Beef segment.

•Increase in performance-based compensation costs of $48 million.

•Increase of $54 million in International/Other from costs related to a production facility fire and our current intention to discontinue the use of certain productive assets in the Netherlands.

•Increase due to net derivative losses of $46 million in the second quarter of fiscal 2024, compared to net derivative losses of $21 million in the second quarter of fiscal 2023 due to our risk management activities. These amounts exclude offsetting impacts from related physical purchase transactions, which are included in the change in live cattle and hog costs and raw material and feed ingredient costs described herein.

•Decrease of approximately $190 million in our Chicken segment related to decreased feed ingredient costs.

•Decrease in freight and transportation costs of approximately $80 million.

•Decrease in hog costs of approximately $75 million in our Pork segment.

•Decrease of $53 million due to costs associated with plant closures.

•Decrease in raw material and other input costs of approximately $20 million in our Prepared Foods segment.

•Remaining decrease in costs across all of our segments primarily driven by net impacts on average cost per pound from mix changes in addition to savings from our productivity program.

Six months – Fiscal 2024 vs Fiscal 2023

•Cost of sales decreased $196 million. Lower sales volume decreased cost of sales by $184 million while lower input cost per pound decreased cost of sales by $12 million.

•The $12 million impact of lower input cost per pound was impacted by:

•Increase in cattle costs of approximately $900 million in our Beef segment.

•Increase of $80 million in International/Other from costs related to a production facility fire and our current intention to discontinue the use of certain productive assets in the Netherlands.

•Increase of $73 million related to the recognition of legal contingency accruals in our Beef and Pork segments.

•Increase in performance-based compensation costs of $93 million.

•Increase of $42 million in our Beef segment from insurance proceeds received in the first quarter of fiscal 2023 related to the fire at our production facility in the fourth quarter of fiscal 2019.

•Increase due to net derivative losses of $51 million in the first six months of fiscal 2024, compared to net derivative ~~gains~~losses of ~~$86~~$9 million in the ~~second quarter~~first six months of fiscal ~~2022~~2023 due to our risk management activities. These amounts exclude offsetting impacts from related physical purchase transactions, which are included in the change in live cattle and hog costs and raw material and feed ingredient costs described herein.

•Increase of ~~$92~~$22 million due to costs associated with plant closures.

•~~Increase of $71 million related to an increase in inventory lower of cost or net realizable value adjustments, primarily in our Chicken segment.~~

•~~Increase in raw material and other input costs~~Decrease of approximately ~~$55 million in our Prepared Foods segment.~~

•~~Increase of approximately $45~~$360 million in our Chicken segment related to ~~net increases in~~decreased feed ingredient costs.

•Decrease in hog costs ~~growout expenses, partially offset by reduced outside meat purchases.~~of approximately $180 million in our Pork segment.

•Decrease in freight and transportation costs of approximately ~~$40~~$170 million.

•Decrease in ~~live hog~~raw material and other input costs of approximately ~~$30~~$75 million in our ~~Pork~~Prepared Foods segment.

•Decrease of $31 million in our Chicken segment from insurance proceeds, net of costs, related to a production facility fire in the fourth quarter of fiscal 2021.

•Remaining ~~increase~~decrease in costs across all of our segments primarily driven by net impacts on average cost per pound from mix changes ~~as well as the impact of the inflationary environment on our labor and other input costs, partially offset by~~in addition to savings from our productivity program.

•~~The $373 million impact of increased sales volume was primarily driven by increased volumes in our Chicken and Pork segments.~~

~~Six months – Fiscal 2023 vs Fiscal 2022~~

•~~Cost of sales increased 2,598 million. Higher sales volume increased cost of sales $462 million while higher input cost per pound increased cost of sales $2,136 million.~~

•~~The $2,136 million impact of higher input cost per pound was impacted by:~~

•~~Increase in live cattle costs of approximately $835 million in our Beef segment.~~

•~~Increase of approximately $220 million in our Chicken segment related to net increases in feed ingredient costs, growout expenses, partially offset by reduced outside meat purchases.~~

•Increase due to net derivative losses of $9 million in the first six months of fiscal 2023, compared to net derivative gains of $164 million in the first six months of fiscal 2022 due to our risk management activities. These amounts exclude offsetting impacts from related physical purchase transactions, which are included in the change in live cattle and hog costs and raw material and feed ingredient costs described herein.

•~~Increase in raw material and other input costs of approximately $105 million in our Prepared Foods segment.~~

•~~Increase of $92 million due to costs associated with plant closures.~~

•~~Increase of $85 million related to an increase in inventory lower of cost or net realizable value adjustments, primarily in our Chicken segment.~~

•~~Increase in live hog costs of approximately $25 million in our Pork segment.~~

•Increase of $25 million in our Chicken segment due to $7 million of costs incurred, net of insurance proceeds, for the first six months of fiscal 2023 compared to $18 million of insurance proceeds, net of costs incurred, in the first six months of fiscal 2022 related to a fire at our production facility in the fourth quarter of fiscal 2021.

•~~Decrease of approximately $42 million in our Beef segment from insurance proceeds related to the fire at our production facility in the fourth quarter of fiscal 2019.~~

•~~Decrease in freight and transportation costs of approximately $15 million.~~

•Remaining increase in costs across all of our segments primarily driven by net impacts on average cost per pound from mix changes as well as the impact of the inflationary environment on our labor and other input costs, partially offset by savings from our productivity program.

•~~The $462 million impact of increased sales volume was primarily driven by increased volumes in our Chicken and Prepared Foods segments.~~

Selling, General and Administrative


in millions	in millions	Three Months Ended						Six Months Ended						in millions	Three Months Ended						Six Months Ended
		April 1, 2023			April 2, 2022			April 1, 2023			April 2, 2022
	March 30, 2024																March 30, 2024			April 1, 2023				March 30, 2024			April 1, 2023
Selling, general and administrative expense	Selling, general and administrative expense	$	576		$	579		$	1,077		$	1,139
As a percentage of sales	As a percentage of sales	4.4		%	4.4		%	4.1		%	4.4		%	As a percentage of sales	4.2	%		4.4	%			4.3	%		4.1	%

Second quarter – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Decrease of $3$22 million in selling, general and administrative was primarily driven by:

•Decrease of ~~$55 million in employee costs primarily from incentive-based compensation.~~

•~~Decrease of $13 million in professional fees.~~

•~~Increase of $26~~$22 million in restructuring and related costs.

•~~Increase~~Decrease of ~~$16~~$11 million in marketing, advertising and promotion expenses.

•~~Increase~~Decrease of $11 million in product donations.

•Increase of $6$27 million in ~~technology related~~team member costs including $56 million in performance-based compensation partially offset by a decrease of $29 million in all other team member costs.

Six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•~~Decrease~~Increase of ~~$62~~$69 million in selling, general and administrative was primarily driven by:

•~~Decrease~~Increase of ~~$111~~$74 million in ~~employee~~team member costs ~~primarily from incentive-based compensation.~~including $107 million in performance-based compensation partially offset by a decrease of $33 million in all other team member costs.

•~~Decrease~~Increase of ~~$31~~$20 million in professional fees.

•Decrease of ~~$21 million in technology related costs.~~

•~~Increase of $39~~$8 million in restructuring and related costs.

•~~Increase of $29 million in marketing, advertising and promotion expenses.~~

•~~Increase of $23 million in product donations.~~

Interest Expense

in millions Three Months Ended Six Months Ended
April 1, 2023 April 2, 2022 April 1, 2023 April 2, 2022
$ 89 $ 97 $ 173 $ 197


in millions	Three Months Ended				Six Months Ended
	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
	$	111	$	89	$	216	$	173

Second quarter and six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•~~Interest expense primarily included interest expense related to our senior notes, in addition to commitment fees incurred on our revolving credit facility.~~ The ~~decrease~~increase in interest expense for the three and six months ended ~~April 1, 2023~~March 30, 2024 was primarily due to interest expense on the ~~redemption~~balance of ~~the June 2022 Senior Notes in fiscal 2022.~~our term loan facilities.

Other (Income) Expense, net

in millions

Three Months Ended

Six Months Ended

in millions

Three Months Ended

Six Months Ended

April 1, 2023

April 2, 2022

April 1, 2023

April 2, 2022

March 30, 2024

April 1, 2023

March 30, 2024

April 1, 2023

Total other (income) expense, net

(1)

(25)

(43)

(77)

Second quarter and six months – Fiscal 2024

•Included $15 million of foreign exchange losses in the second quarter of fiscal 2024. Included $10 million of income related to an amendment of a postretirement benefit plan in the first six months of fiscal 2024.

Second quarter and six months– Fiscal 2023

•Included $18 million of joint venture earnings and $29 million of foreign exchange gains in the first six months of fiscal 2023.

~~Second quarter and six months – Fiscal 2022~~

•Included $14 million of joint venture earnings in the second quarter of fiscal 2022. Included $22 million of production facilities fire insurance proceeds and a $37 million gain on an equity investment due to an observable price change in the first six months of fiscal 2022.

Effective Tax Rate

Three Months Ended Six Months Ended
April 1, 2023 April 2, 2022 April 1, 2023 April 2, 2022
29.4 % 23.4 % 24.7 % 21.6 %


Three Months Ended				Six Months Ended
March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
26.9	%	29.4	%	28.0	%	24.7	%

Second quarter – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•The ~~percentage impacts~~second quarter of ~~items on the effective tax rate were greater in~~ fiscal ~~2023 due to the level of pretax income (loss) in fiscal 2023 compared to fiscal 2022.~~

•2024 was impacted by increased foreign losses. In both periods, the effective tax rates were ~~increased due to~~impacted by state taxes and ~~include the impact of~~ various tax benefits; however, tax benefits increase the effective tax rate in a period of pretax loss and decrease the effective tax rate in a period of pretax income, resulting in a higher effective tax rate in the second quarter of fiscal 2023.

•The percentage impacts of items on the effective tax rate were greater in fiscal 2023 due to the level of pretax income (loss) in fiscal 2023 compared to fiscal 2024.

Six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•~~The~~In both periods, the effective tax rates ~~for both periods~~ were increased by state taxes, ~~and decreased~~partially offset by various tax ~~benefits.~~

•~~The~~benefits; however, increased foreign losses in fiscal 2024 resulted in a higher effective tax rate ~~for the first six months of~~compared to fiscal ~~2022 includes a $36 million benefit from the remeasurement of deferred income taxes, primarily due to legislation decreasing state tax rates enacted in the first quarter of fiscal 2022.~~2023.

Net Income (Loss) Attributable to Tyson

in millions, except per share data

Three Months Ended

Six Months Ended

in millions, except per share data

Three Months Ended

Six Months Ended

April 1, 2023

April 2, 2022

April 1, 2023

April 2, 2022

March 30, 2024

April 1, 2023

March 30, 2024

April 1, 2023

Net income (loss) attributable to Tyson

(97)

829

219

1,950

Net income (loss) attributable to Tyson

Net income (loss) attributable to Tyson – per diluted share

(0.28)

2.28

0.61

5.35

Second quarter – Fiscal 2024 – Net income (loss) attributable to Tyson included the following items:

•$54 million pretax, or ($0.15) per diluted share, of charges related to a production facility fire and our current intention to discontinue the use of certain productive assets in the Netherlands.

•$39 million pretax, or ($0.06) per diluted share, of charges related to plant closures.

Six months – Fiscal 2024 – Net income (loss) attributable to Tyson included the following items:

•$114 million pretax, or ($0.22) per diluted share, of charges related to plant closures.

•$80 million pretax, or ($0.22) per diluted share, of charges related to a production facility fire and our current intention to discontinue the use of certain productive assets in the Netherlands.

•$73 million pretax, or ($0.16) per diluted share, related to the recognition of a legal contingency accrual.

•$31 million pretax, or ($0.06) per diluted share, of restructuring and related charges.

•$27 million pretax, or $0.06 per diluted share, of production facilities fire insurance proceeds, net of costs incurred.

Second quarter – Fiscal 2023 – Net income (loss) attributable to Tyson included the following items:

•$22 million pretax, or ($0.05) per diluted share, of restructuring and related charges.

•$92 million pretax, or ($0.19) per diluted share, of charges related to plant closures.

Six months – Fiscal 2023 – Net income (loss) attributable to Tyson included the following items:

•$35 million pretax, or $0.07 per diluted share, of production facilities fire insurance proceeds, net of costs incurred.

•$43 million pretax, or ($0.09) per diluted share, of restructuring and related charges.

•$92 million pretax, or ($0.19) per diluted share, of charges related to plant closures.

~~Second quarter – Fiscal 2022 –~~ ~~Net income attributable to Tyson included the following items:~~

•~~$5 million pretax, or ($0.01) per diluted share, of production facilities fire costs, net of insurance proceeds.~~

~~Six months – Fiscal 2022 –~~ ~~Net income attributable to Tyson included the following items:~~

•~~$40 million pretax, or $0.09 per diluted share, of production facilities fire insurance proceeds, net of costs incurred.~~

•~~$36 million post tax, or $0.10 per diluted share, from remeasurement of net deferred tax liabilities at lower enacted state tax rates.~~

Segment Results

We operate in four segments: Beef, Pork, Chicken, and Prepared Foods. The following table is a summary of sales and operating income (loss), which is how we measure segment profit.


in millions	in millions	Sales								in millions	Sales
		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended												Three Months Ended			Six Months Ended
	March 30, 2024											March 30, 2024		April 1, 2023	March 30, 2024		April 1, 2023
Beef	Beef	$	4,617	$	5,034	$	9,340	$	10,036
Pork	Pork	1,421		1,565		2,950		3,191
Chicken	Chicken	4,430		4,086		8,693		7,976
Prepared Foods	Prepared Foods	2,422		2,393		4,960		4,726
International/Other	International/Other	634		565		1,246		1,115
Intersegment sales	Intersegment sales	(391)		(526)		(796)		(994)
Total	Total	$	13,133	$	13,117	$	26,393	$	26,050


in millions	in millions	Operating Income (Loss)								in millions	Operating Income (Loss)
		Three Months Ended				Six Months Ended
		April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
	Three Months Ended												Three Months Ended			Six Months Ended
	March 30, 2024											March 30, 2024		April 1, 2023	March 30, 2024		April 1, 2023
Beef	Beef	$	—	$	638	$	166	$	1,594
Pork	Pork	(33)		59		(54)		223
Chicken	Chicken	(258)		198		(189)		338
Prepared Foods	Prepared Foods	241		263		499		449
International/Other	International/Other	1		(2)		(4)		7
Total	Total	$	(49)	$	1,156	$	418	$	2,611

Beef Segment Results


in millions	in millions	Three Months Ended									Six Months Ended									in millions	Three Months Ended			Six Months Ended
		April 1, 2023			April 2, 2022			Change			April 1, 2023			April 2, 2022			Change
	March 30, 2024																					March 30, 2024	April 1, 2023		Change			March 30, 2024	April 1, 2023	Change
Sales	Sales	$	4,617		$	5,034		$	(417)		$	9,340		$	10,036		$	(696)
Sales volume change	Sales volume change							(2.9)		%							—		%	Sales volume change						2.8	%				(0.8)	%
Average sales price change	Average sales price change							(5.4)		%							(6.9)		%	Average sales price change						4.5	%				7.6	%
Operating income		$	—		$	638		$	(638)		$	166		$	1,594		$	(1,428)
Operating income (loss)
Operating margin	Operating margin	—		%	12.7		%				1.8		%	15.9		%

Second quarter and six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Sales Volume - Sales volume ~~decreased~~increased in the second quarter of fiscal ~~2023 driven by lower availability of live cattle.~~2024 primarily due to higher average carcass weights. Sales volume ~~remained flat in~~for the first six months decreased due to overall lower availability of ~~fiscal 2023.~~market-ready cattle.

•Average Sales Price - Average sales price ~~decreased~~increased in the second quarter and first six months of fiscal 2024 primarily due to ~~reduced export demand and softening domestic demand associated with~~ increased ~~supply of competing proteins in the market.~~input costs.

•Operating Income (Loss) - Operating income decreased in the second quarter and first six months of fiscal 2024 primarily due to ~~unfavorable market conditions, including higher fed cattle costs and reduced demand~~compressed beef margins. Operating income for ~~beef products, which made it difficult to pass along increased input costs. Additionally, operating income in~~ the first six months of fiscal 2024 was impacted by a $45 million legal contingency accrual and $41 million of costs related to plant closures. Operating income for the second quarter of fiscal 2023 was impacted by $8 million of restructuring and related charges while operating income for the first six months of fiscal 2023 was impacted by $13 million of restructuring and related charges and benefited from $42 million of insurance proceeds related to a fire at a production facility in ~~the fourth quarter of fiscal~~ 2019.

Pork Segment Results


in millions	in millions	Three Months Ended									Six Months Ended									in millions	Three Months Ended			Six Months Ended
		April 1, 2023			April 2, 2022			Change			April 1, 2023			April 2, 2022			Change
	March 30, 2024																					March 30, 2024	April 1, 2023		Change			March 30, 2024	April 1, 2023	Change
Sales	Sales	$	1,421		$	1,565		$	(144)		$	2,950		$	3,191		$	(241)
Sales volume change	Sales volume change							1.1		%							(3.2)		%	Sales volume change						2.9	%				5.3	%
Average sales price change	Average sales price change							(10.3)		%							(4.4)		%	Average sales price change						1.7	%				(3.5)	%
Operating income (loss)	Operating income (loss)	$	(33)		$	59		$	(92)		$	(54)		$	223		$	(277)
Operating margin	Operating margin	(2.3)		%	3.8		%				(1.8)		%	7.0		%

Second quarter and six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Sales Volume - Sales volume increased ~~during~~in the second quarter and first six months of fiscal 2024 due to improved market conditions and increased domestic availability of market-ready hogs.

•Average Sales Price - Average sales price increased in the second quarter of fiscal ~~2023~~2024 due to ~~increased availability of live hogs. Sales volume decreased in~~improved demand. For the first six months of fiscal ~~2023~~2024, average sales price decreased as pork product supplies outpaced the recovering demand environment.

•Operating Income (Loss) - Operating income increased in the second quarter and first six months of fiscal 2024 primarily due to improved pork margins. Operating income for the second quarter and first six months of fiscal 2024 was impacted by $34 million of costs related to a ~~result~~plant closure. Additionally, operating income for the first six months of ~~balancing our supply with customer demand during~~fiscal 2024 was impacted by a ~~period~~$28 million legal contingency accrual.

Chicken Segment Results


in millions	Three Months Ended									Six Months Ended
	March 30, 2024			April 1, 2023			Change			March 30, 2024			April 1, 2023			Change
Sales	$	4,065		$	4,430		$	(365)		$	8,098		$	8,693		$	(595)
Sales volume change							(6.1)		%							(3.8)		%
Average sales price change							(2.1)		%							(3.0)		%
Operating income (loss)	$	158		$	(258)		$	416		$	335		$	(189)		$	524
Operating margin	3.9		%	(5.8)		%				4.1		%	(2.2)		%

Second quarter and six months – Fiscal 2024 vs Fiscal 2023

•Sales Volume - Sales volume decreased in the second quarter and first six months of ~~margin compression.~~fiscal 2024 primarily due to reduced domestic production.

•Average Sales Price - Average sales price decreased in the second quarter and first six months of fiscal 2024 due to ~~reduced global demand.~~the impact of lower input costs.

•Operating Income (Loss) - Operating income ~~decreased due to compressed pork margins and~~ increased ~~operating costs as a result of the inflationary market environment. Additionally, volatile market conditions resulted in net derivative gains of $25 million and $5 million~~ in the second quarter and first six months of fiscal ~~2023, respectively, as compared~~2024 primarily due to ~~net derivative losses~~improved operational efficiencies, in addition to reductions of ~~$30~~$190 million and ~~$15~~$360 million of feed ingredient costs in the second quarter and first six months of fiscal ~~2022,~~2024, respectively, ~~which excludes~~partially offset by lower average sales price. Additionally, operating income in the ~~impacts~~second quarter and first six months of ~~related physical purchase transactions.~~fiscal 2024 was impacted by $55 million and $65 million of net derivative losses, respectively. The first six months of fiscal 2024 was impacted by $39 million in plant closure charges offset by $24 million of insurance proceeds, net of costs incurred associated with a production facility fire in the fourth quarter of fiscal 2021. Operating income for the second quarter and first six months of fiscal 2023 was impacted by $35 million and $15 million of net derivative losses, respectively, in addition to $92 million of charges associated with plant closures.

~~Chicken~~

Prepared Foods Segment Results


in millions	in millions	Three Months Ended									Six Months Ended									in millions	Three Months Ended			Six Months Ended
		April 1, 2023			April 2, 2022			Change			April 1, 2023			April 2, 2022			Change
	March 30, 2024																					March 30, 2024	April 1, 2023		Change			March 30, 2024	April 1, 2023	Change
Sales	Sales	$	4,430		$	4,086		$	344		$	8,693		$	7,976		$	717
Sales volume change	Sales volume change							6.4		%							4.5		%	Sales volume change						0.7	%				1.6	%
Average sales price change	Average sales price change							2.0		%							4.5		%	Average sales price change						(1.4)	%				(1.9)	%
Operating income (loss)		$	(258)		$	198		$	(456)		$	(189)		$	338		$	(527)
Operating income
Operating margin	Operating margin	(5.8)		%	4.8		%				(2.2)		%	4.2		%

Second quarter and six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~

•~~Sales Volume~~ ~~- Sales volume increased primarily due to improved domestic production as well as the sell-through of inventory, partially offset by strategic initiative mix impacts.~~

•~~Average Sales Price~~ - Average sales price increased primarily due to the effects of pricing initiatives in the second half of fiscal 2022, partially offset by challenging market conditions and the sell-through of inventory.

•~~Operating Income (Loss)~~ - Operating income decreased primarily due to the impacts of inflationary market conditions including increased supply chain and labor costs as well as operational impacts associated with strategic decisions. In the second quarter of fiscal 2023 we experienced $145 million of higher feed ingredient costs and $35 million of net derivative losses as compared to $101 million of net derivative gains in the second quarter of fiscal 2022. In the first six months of fiscal 2023, we experienced $370 million of higher feed ingredient costs and $15 million of net derivative losses as compared to $159 million of net derivative gains in the first six months of fiscal 2022. Additionally, operating income was impacted by $92 million of charges associated with plant closures and a $25 million reduction in insurance proceeds, net of costs incurred related to a fire at a production facility compared to the first six months of fiscal 2022.

~~Prepared Foods Segment Results~~

in millions Three Months Ended Six Months Ended
April 1, 2023 April 2, 2022 Change April 1, 2023 April 2, 2022 Change
Sales $ 2,422 $ 2,393 $ 29 $ 4,960 $ 4,726 $ 234
Sales volume change (0.4) % 0.4 %
Average sales price change 1.6 % 4.6 %
Operating income $ 241 $ 263 $ (22) $ 499 $ 449 $ 50
Operating margin 10.0 % 11.0 % 10.1 % 9.5 %

~~Second quarter and six months – Fiscal 2023 vs Fiscal 2022~~

•Sales Volume – Sales volume ~~decreased slightly~~increased in the second quarter ~~of fiscal 2023 due to uneven foodservice recovery. Sales volume increased slightly in the~~and first six months of fiscal ~~2023~~2024 primarily due to ~~strong retail demand and improved operational performance.~~the acquisition of Williams Sausage Company in the third quarter of 2023.

•Average Sales Price – Average sales price ~~increased~~decreased in the second quarter and first six months of fiscal 2024 primarily due to ~~the effects of revenue management in an inflationary cost environment and favorable product~~sales mix.

•Operating Income – Operating income decreased in the second quarter and first six months of fiscal ~~2023~~2024 partially due to ~~the impacts of inflationary market conditions, including $55 million of increased~~lower average sales price which was largely offset by reduced raw materials ~~and other input costs, slightly offset by higher average sales price. Operating~~costs. Additionally, operating income ~~increased in~~for the first six months of fiscal ~~2023 due to higher average sales price offset~~2024 was impacted by ~~inflationary market conditions, including $105~~$24 million of ~~increased raw materials~~restructuring and ~~other input~~related costs. Operating income for the second quarter and first six months of fiscal 2023 was impacted by $11 million and $19 million of restructuring and related costs, respectively.

International/Other Results


in millions	in millions	Three Months Ended						Six Months Ended						in millions	Three Months Ended			Six Months Ended
		April 1, 2023		April 2, 2022		Change		April 1, 2023		April 2, 2022		Change
	March 30, 2024															March 30, 2024	April 1, 2023		Change	March 30, 2024	April 1, 2023	Change
Sales	Sales	$	634	$	565	$	69	$	1,246	$	1,115	$	131

Operating income (loss)	Operating income (loss)	1		(2)		3		(4)		7		(11)

Operating income (loss)

Operating income (loss)

Second quarter and six months – Fiscal ~~2023~~2024 vs Fiscal ~~2022~~2023

•Sales – Sales ~~increased~~were negatively impacted in the second quarter and first six months of fiscal 2024 by lower volume and unfavorable sales mix across the Asia-Pacific region and China due to macroeconomic headwinds, partially offset by volume ~~growth as we continued to invest~~increases in ~~our business and improved pricing in an inflationary cost environment.~~the other regions.

•Operating Income (Loss) – Operating income decreased ~~for the first six months of fiscal 2023~~ primarily due to charges related to a production facility fire in the ~~impacts~~Netherlands in the first quarter of ~~global inflationary market conditions~~fiscal 2024 and current intention to discontinue the ~~slower than anticipated recovery~~use of certain productive assets in the ~~economy in China post COVID-19 lockdowns.~~second quarter of fiscal 2024.

LIQUIDITY AND CAPITAL RESOURCES

Our cash needs for working capital, capital expenditures, growth opportunities, repurchases of senior notes, repayment of maturing debt, the payment of dividends and share repurchases are expected to be met with current cash on hand, cash flows provided by operating activities or short-term borrowings. Based on our current expectations, we believe our liquidity and capital resources will be sufficient to operate our business. However, we may take advantage of opportunities to generate additional liquidity or refinance existing debt through capital market transactions. The amount, nature and timing of any capital market transactions will depend on our operating performance and other circumstances; our then-current commitments and obligations; the amount, nature and timing of our capital requirements; any limitations imposed by our current credit arrangements; and overall market conditions.

~~Cash Flows from Operating Activities~~
in millions Six Months Ended
April 1, 2023 April 2, 2022
Net income $ 229 $ 1,959
Non-cash items in net income:
Depreciation and amortization 620 595
Deferred income taxes (29) 98
Other, net 191 27
Net changes in operating assets and liabilities (242) (1,455)
Net cash provided by operating activities $ 769 $ 1,224

•The decrease in net cash provided by operating activities was primarily due to lower earnings as a result of operations, offset by lower payments for income taxes, legal accruals and annual incentive payments as well as comparative decreases in Accounts Receivable, Inventories and Accounts Payable.

3334

Cash Flows from Operating Activities


in millions	Six Months Ended
	March 30, 2024		April 1, 2023
Net income	$	262	$	229
Non-cash items in net income	843		782
Net changes in operating assets and liabilities:
(Increase) decrease in accounts receivable	116		187
(Increase) decrease in inventories	272		(5)
Increase (decrease) in accounts payable	(325)		(145)
Increase (decrease) in income taxes payable/receivable	57		62
Net changes in other operating assets and liabilities	(48)		(341)
Net cash provided by operating activities	$	1,177	$	769

•Non-cash items in net income primarily includes depreciation and amortization of $722 million and $620 million for the six months ended March 30, 2024 and April 1, 2023, respectively.

•Cash provided by operating activities for the first six months of fiscal 2024 was $1.2 billion, an increase of $408 million compared to the first six months of fiscal 2023, due to $94 million of higher earnings, net of non-cash items, and a $314 million increase in cash provided by the net changes in operating assets and liabilities which was primarily impacted by:

•An increase of $293 million due to a decrease of $48 million in the net changes in other operating assets and liabilities in the first six months of fiscal 2024, compared to a decrease of $341 million in fiscal 2023, primarily driven by performance-based compensation.

•An increase of $277 million due to a decrease in inventory of $272 million in the first six months of fiscal 2024, compared to an increase of $5 million in the first six months of fiscal 2023, primarily driven by decreased average cost of inventory and lower volume of livestock.

•Partially offset by:

•A decrease of $180 million due to a decrease in accounts payable of $325 million during the first six months of fiscal 2024, compared to a decrease of $145 million in the first six months of fiscal 2023, primarily due to lower input costs and changes in days payables outstanding.

•A decrease of $71 million due to a decrease in accounts receivable of $116 million in the first six months of fiscal 2024, compared to a decrease of $187 million in the first six months of fiscal 2023. The reduced decline in accounts receivable was primarily due to level of sales in the last few weeks of each quarter end.

Cash Flows from Investing Activities


in millions	in millions	Six Months Ended				in millions	Six Months Ended
		April 1, 2023		April 2, 2022
	March 30, 2024							March 30, 2024	April 1, 2023
Additions to property, plant and equipment	Additions to property, plant and equipment	$	(1,097)	$	(847)
Proceeds from sale of (purchases of) marketable securities, net	Proceeds from sale of (purchases of) marketable securities, net	(1)		—
Acquisition, net of cash acquired	Acquisition, net of cash acquired	(39)		—

Acquisition of equity investments	Acquisition of equity investments	(37)		(96)
Acquisition of equity investments
Acquisition of equity investments
Other, net	Other, net	(2)		58
Net cash used for investing activities	Net cash used for investing activities	$	(1,176)	$	(885)

•Additions to property, plant and equipment included spending for production growth, safety and animal well-being, new equipment, infrastructure replacements and upgrades to maintain competitive standing and position us for future opportunities.

•~~Capital spending~~We expect capital expenditures between $1.2 billion and $1.4 billion for fiscal ~~2023 is expected to approximate $2.3 billion~~2024. Capital expenditures include investments in profit improvement projects as well as projects for maintenance and repair. This includes ~~spending for~~completion of capacity expansion projects as well as new equipment, automation technology and ~~utilization, automation to alleviate labor challenges and brand and~~processes for product ~~innovations.~~innovation.

•Acquisition, net of cash acquired for the six months ended April 1, 2023 included our 60% equity stake in Supreme Foods Processing Company, a producer and distributor of value-added and cooked chicken and beef products.

•

Other, net for the first six months of fiscal 2022 primarily included insurance proceeds received related to a fire at one of our Chicken production facilities, proceeds from the disposition of assets and change in deposits for capital expenditures.

Cash Flows from Financing Activities


in millions	in millions	Six Months Ended				in millions	Six Months Ended
		April 1, 2023		April 2, 2022
	March 30, 2024							March 30, 2024	April 1, 2023
Proceeds from issuance of debt	Proceeds from issuance of debt	$	88	$	47
Payments on debt	Payments on debt	(121)		(1,088)

Proceeds from issuance of commercial paper	Proceeds from issuance of commercial paper	4,773		—

Proceeds from issuance of commercial paper

Proceeds from issuance of commercial paper
Repayments of commercial paper	Repayments of commercial paper	(4,182)		—

Purchases of Tyson Class A common stock
Purchases of Tyson Class A common stock
Purchases of Tyson Class A common stock	Purchases of Tyson Class A common stock	(332)		(511)
Dividends	Dividends	(336)		(328)
Stock options exercised	Stock options exercised	8		113
Other, net	Other, net	1		—
Net cash used for financing activities		$	(101)	$	(1,767)
Net cash provided by (used for) financing activities

•During the first six months of fiscal ~~2022, we extinguished~~2024, proceeds from issuance of debt included $750 million of proceeds from the ~~$1 billion outstanding balance~~term loan facility due May 2028, $600 million of ~~our senior notes due June 2022.~~proceeds from the 5.40% 2029 Notes, and $900 million from the 5.70% 2034 Notes.

•~~During~~Payments on debt during the ~~first~~ six months ended March 30, 2024 included a payment of ~~fiscal 2023, we had net borrowings of $591~~$250 million ~~pursuant to~~on our ~~commercial paper program.~~term loan facility due May 2026.

•Purchases of Tyson Class A stock included:

•$300 ~~million and $420~~ million of cash paid for shares repurchased pursuant to our share repurchase program during the six months ended April 1, ~~2023 and April 2, 2022, respectively.~~2023.

•$3231 million and ~~$91~~$32 million of shares repurchased to fund certain obligations under our equity compensation programs during the six months ended March 30, 2024 and April 1, 2023, ~~and April 2, 2022,~~ respectively.

•Dividends paid during the six months ended ~~April 1, 2023~~March 30, 2024 reflected a 4%2% increase to our fiscal ~~2022~~2023 quarterly dividend rate.

Liquidity

in millions

Commitments
Expiration Date

Facility
Amount

Outstanding
Letters of Credit
(no draw downs)

Amount
Borrowed

Amount
Available at
April 1, 2023

Commitments
Expiration Date

Facility
Amount

Outstanding
Letters of Credit
(no draw downs)

Amount
Borrowed

Amount
Available at
March 30, 2024

Cash and cash equivalents

543

Short-term investments

Revolving credit facility

September 2026

2,250

—

2,250

Commercial paper

(593)

Total liquidity

2,207

•Liquidity includes cash and cash equivalents, short-term investments and availability under our revolving credit, ~~facility,~~ less the outstanding commercial paper balance.

•At ~~April 1, 2023,~~March 30, 2024, we had current debt of ~~$1,065~~$1,315 million, which we intend to pay with cash generated from our operating activities and other existing or new liquidity sources.

•The revolving credit facility supports our short-term funding needs and also serves to backstop our commercial paper program. We had no borrowings under the revolving credit facility during the six months ended ~~April 1, 2023.~~March 30, 2024. Under the terms of the facility, we have the option to establish incremental commitment increases of up to $500 million if certain conditions are met.

•~~On May 3, 2023, we entered into two new term loan facilities totaling $1.75 billion to refinance our commercial paper program and for general corporate purposes.~~

•We have entered into definitive acquisition agreements expected to close in fiscal 2023 that are pending certain customary closing conditions. We expect to incur net cash outflows from investing activities in the range of $200 million to $250 million associated with the pending activity.

•We expect net interest expense to approximate ~~$340~~$400 million for fiscal ~~2023.~~2024.

•Our current ratio was ~~1.7 to 1 at April 1, 2023 and~~ 1.8 to 1 at ~~October~~March 30, 2024 and 1.3 to 1 ~~2022.~~at September 30, 2023. The increase in fiscal 2024 is primarily due to increased cash and cash equivalents and decreased current debt.

•At ~~April 1, 2023,~~March 30, 2024, approximately ~~$508~~$649 million of our cash was held in the accounts of our foreign subsidiaries. Generally, we do not rely on the foreign cash as a source of funds to support our ongoing domestic liquidity needs. We manage our worldwide cash requirements by reviewing available funds among our foreign subsidiaries and the cost effectiveness with which those funds can be accessed. We intend to repatriate excess cash (net of applicable withholding taxes) not subject to regulatory requirements and to indefinitely reinvest outside of the United States the remainder of cash held by foreign subsidiaries. We do not expect the regulatory restrictions or taxes on repatriation to have a material effect on our overall liquidity, financial condition or the results of operations for the foreseeable future.

Capital Resources

Credit Facility

Cash flows from operating activities and cash on hand are our primary sources of liquidity for funding debt service, capital expenditures, dividends and share repurchases. We also have a revolving credit facility, with a committed capacity of $2.25 billion, to provide additional liquidity for working capital needs and to backstop our commercial paper program.

At ~~April 1, 2023,~~March 30, 2024, amounts available for borrowing under our revolving credit facility totaled $2.25 ~~billion before deducting amounts to backstop our commercial paper program.~~billion. Our revolving credit facility is funded by a syndicate of 20 banks, with commitments ranging from $35 million to $175 million per bank.

Commercial Paper Program

Our commercial paper program provides a low-cost source of borrowing to fund general corporate purposes including working capital requirements. The maximum borrowing capacity under the commercial paper program is $1.5 billion. The maturities of the notes may vary, but may not exceed 397 days from the date of issuance. As of ~~April 1, 2023, $593 million was~~March 30, 2024, we had no commercial paper outstanding under this ~~program with maturities of less than 25 days.~~program. Our ability to access commercial paper in the future may be limited or its costs increased.

~~Capitalization~~

To monitor our credit ratings and our capacity for long-term financing, we consider various qualitative and quantitative factors. We monitor the ratio of our net debt to EBITDA as support for our long-term financing decisions. At April 1, 2023, and October 1, 2022, the ratio of our net debt to EBITDA was 2.4x and 1.3x, respectively. Refer to Part I, Item 3, EBITDA Reconciliations, for an explanation and reconciliation to comparable Generally Accepted Accounting Principles (“GAAP”~~) measures.~~

Credit Ratings

~~Revolving Credit~~Term Loan Facility due May 2028

Standard & Poor’s Rating Services’, a Standard & Poor’s Financial Services LLC business (“S&P”), applicable rating is ~~“BBB+”~~“BBB”. Moody’s Investor Service, Inc.’s (“Moody’s”) applicable rating is “Baa2”. The below table outlines the commitment fee on any unused borrowing capacity and the borrowing spread on the outstanding principal balance of our term loan facility due May 2028 that corresponds to the applicable ratings levels from S&P and Moody’s.


Ratings Level (Moody’s/S&P)	Commitment Fee		Borrowing Spread
Baal/BBB+ or above	0.100	%	1.625	%
Baa2/BBB (current level)	0.125	%	1.750	%
Baa3/BBB- or lower	0.175	%	1.875	%

Term Loan Facility due May 2026

S&P applicable rating is “BBB” and Moody’s applicable rating is “Baa2”. The below table outlines the borrowing spread on the outstanding principal balance of our term loan facility due May 2026 that corresponds to the applicable ratings levels from S&P and Moody’s.


Ratings Level (Moody’s/S&P)	Borrowing Spread
A2/A or above	0.875	%
A3/A-	1.000	%
Baal/BBB+	1.125	%
Baa2/BBB (current level)	1.250	%
Baa3/BBB- or lower	1.375	%

Revolving Credit Facility

S&P applicable rating is “BBB” and Moody’s applicable rating is “Baa2”. The below table outlines the fees paid on the unused portion of the facility (“Facility Fee Rate”) and letter of credit fees and borrowings (“All-in Borrowing Spread”) that corresponds to the applicable ratings levels from S&P and Moody’s.

Ratings Level (Moody’s/S&P) Facility Fee Rate All-in Borrowing Spread
A2/A or above 0.070 % 0.875 %
A3/A- 0.090 % 1.000 %
Baal/BBB+ (current level) 0.100 % 1.125 %
Baa2/BBB 0.125 % 1.250 %
Baa3/BBB- or lower 0.175 % 1.375 %


Ratings Level (Moody’s/S&P)	Facility Fee Rate		All-in Borrowing Spread
A2/A or above	0.070	%	0.875	%
A3/A-	0.090	%	1.000	%
Baal/BBB+	0.100	%	1.125	%
Baa2/BBB (current level)	0.125	%	1.250	%
Baa3/BBB- or lower	0.175	%	1.375	%

In the event the rating levels fall within different levels, the applicable rate will be based upon the higher of the two Levels or, if there is more than a one-notch split between the two Levels, then the Applicable Rate will be based upon the Level that is one Level below the higher Level.

Debt Covenants

We were in compliance with all debt covenants at ~~April 1, 2023,~~March 30, 2024, and we expect that we will maintain compliance.

RECENTLY ISSUED/ADOPTED ACCOUNTING PRONOUNCEMENTS

Refer to the discussion of recently issued/adopted accounting pronouncements under Part I, Item 1, Notes to Consolidated Condensed Financial Statements, Note 1: Accounting Policies.

CRITICAL ACCOUNTING ESTIMATES

We consider accounting policies related to: contingent liabilities; revenue recognition; accrued self-insurance; defined benefit pension plans; impairment of long-lived assets and definite life intangibles; impairment of goodwill and indefinite life intangible assets; business combinations; and income taxes to be critical accounting estimates. These policies are summarized in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended ~~October 1, 2022.~~September 30, 2023. Refer to Part I, Item 1, Notes to Consolidated Condensed Financial Statements, Note 1: Accounting Policies, for updates to our significant accounting policies during the six months ended ~~April 1, 2023.~~March 30, 2024. These critical accounting policies require us to make estimates and assumptions that affect the amounts reported in the consolidated condensed financial statements and accompanying notes.

As further described in the impairment of goodwill and indefinite life intangible assets critical accounting estimate included in our Annual Report on Form 10-K for the fiscal year ended October 1, 2022, we assess goodwill and indefinite life assets for impairment at least annually as of the first day the fourth quarter and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Conditions existed as of the end our first quarter that required an interim assessment of goodwill for two of our International reporting units which had goodwill totaling $0.2 billion at December 31, 2022. The first quarter interim assessment was deemed necessary due to higher discount rates used in estimating the fair value of the reporting units as well as lower than anticipated operating results during the first quarter of fiscal 2023. Based on the first quarter interim assessment, we determined no impairment was necessary as the fair value of the reporting units exceeded their carrying value. Had we assumed future operating margins consistent with those realized in the first three months of the current fiscal year, both reporting units would have failed the quantitative step of the first quarter interim impairment test, which may have resulted in a goodwill impairment loss. The goodwill for these reporting units originated from acquisitions in fiscal 2019 and fiscal 2018, and we are still integrating them and investing in our international and global business strategy, in addition to managing through the temporary impacts of COVID-19. The reporting units' projected long-term operating margins included in the first quarter interim impairment test had to exceed an average of 4% to achieve breakeven results in the analysis. A hypothetical increase in the discount rates of approximately 50 basis points, with all other assumptions unchanged, at December 31, 2022, would have caused the carrying values of these reporting units to approximate their fair values. Our qualitative assessment for the first and second ~~quarter~~quarters of fiscal 2024 did not indicate that it was more likely than not the fair value of any of our reporting units ~~may be impaired,~~or indefinite lived intangibles was less than the carrying amount, and as such, no quantitative ~~goodwill~~ test was deemed ~~necessary; however the assessment~~necessary. We consider reporting units and indefinite lived intangibles that have 20% or less excess fair value over carrying amount to have a heightened risk of impairment. The following reporting units and indefinite lived intangibles were considered at heightened risk of impairment ~~for these~~as of the date of the most recent estimated fair value determination, which was in the fourth quarter of fiscal 2023: our Chicken segment reporting units, ~~continues to be~~our Beef reporting unit and our Pork reporting unit with goodwill totaling $3.1 billion, $0.3 billion and $0.4 billion, respectively, and two Prepared Foods brands with carrying values of $0.5 billion and $0.3 billion.

We continuously evaluate the changing macroeconomic conditions including inflationary pressures, rising interest rates, demand outlook and export markets as well as the Company's market capitalization. Our reporting units with heightened risk of future impairments with $3.8 billion carrying value, as well as a brand with $0.5 billion carrying value, all had less than 10% of excess fair value above carrying value as of the date of the most recent estimated fair value determination. Consequently, their estimated fair values remain highly sensitive to future discount rate increases, changing macroeconomic conditions and achievement of projected long-term operating ~~margins as previously quantified.~~

~~Our impairment analysis contains inherent estimates~~margins. Although our remaining reporting units and assumptions, many of which are outside the control of management including interest rates, cost of capital, tax rates, market EBITDA comparables and credit ratings, which could positively or negatively impact the anticipated future economic and operating conditions. The assumptions and estimates used in determiningindefinite life intangible assets generally had more than 20% excess fair value ~~require considerable judgement and are sensitive to changes in underlying assumptions. These assumptions can change in future periods~~over carrying amount as a result of overall economic conditions, including the impacts of inflationary pressures, increased interest and discount rates and global supply chain constraints, decreased market capitalization, amongst others. As a result, there can be no assurance that estimates and assumptions made for the purpose of assessing impairments will prove to be an accurate prediction of the ~~future. Potential circumstances that could have a negative effect on~~date of the ~~fair value of our reporting units include, but are not limited to, lower than forecasted growth rates or operating margins and changes in discount rates. A reduction in the~~most recent estimated fair value ~~of the reporting units could trigger an impairment~~determination, they are also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future. ~~We cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of our goodwill and indefinite lived assets.~~

CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Certain information in this report constitutes forward-looking statements. ~~These statements are intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995.~~ Such forward-looking statements include, but are not limited to, current views and estimates of our outlook for fiscal ~~2023,~~2024, other future economic circumstances, industry conditions in domestic and international markets, our performance and financial results (e.g., debt levels, return on invested capital, value-added product growth, capital expenditures, tax rates, access to foreign markets and dividend policy). Words such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” “project,” “forecast,” “target,” “outlook,” “may,” “should,” “could,” and similar expressions, as well as statements written in the future tense, identify forward-looking statements. These forward-looking statements are subject to a number of factors and uncertainties that could cause our actual results and experiences to differ materially from anticipated results and expectations expressed in such forward-looking statements. We wish to caution readers not to place undue reliance on any forward-looking statements, which ~~are expressly qualified in their entirety by this cautionary statement and~~ speak only as of the date made. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Among the factors that may cause actual results and experiences to differ from anticipated results and expectations expressed in such forward-looking statements are the following: (i) ~~the COVID-19 pandemic and associated responses thereto~~global pandemics have had, and may in the future have, an adverse impact on our business and operations, and the extent that the COVID-19 pandemic continues to impact us will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the COVID-19 related impacts on the market, including production delays, labor shortages and increases in costs and inflation;operations; (ii) the effectiveness of ~~our~~restructuring or financial excellence programs; (iii) access to foreign markets together with foreign economic conditions, including currency fluctuations, import/export restrictions and foreign politics; (iv) ~~cyberattacks,~~cyber attacks, other cyber incidents, security breaches or other disruptions of our information technology systems; (v) risks associated with our failure to consummate favorable acquisition transactions or integrate certain acquisitions’ operations; (vi) the Tyson Limited Partnership’s ability to exercise significant control over the Company; (vii) fluctuations in the cost and availability of inputs and raw materials, such as live cattle, live swine, feed grains (including corn and soybean meal) and energy; (viii) market conditions for finished products, including competition from other global and domestic food processors, supply and pricing of competing products and alternative proteins and demand for alternative proteins; (ix) outbreak of a livestock disease (such as African swine fever (ASF), avian influenza (AI) or bovine spongiform encephalopathy (BSE)), which could have an adverse effect on livestock we own, the availability of livestock we purchase, consumer perception of certain protein products or our ability to conduct our operations; (x) changes in consumer preference and diets and our ability to identify and react to consumer trends; (xi) effectiveness of advertising and marketing programs; (xii) significant marketing plan changes by large customers or loss of one or more large customers; (xiii) our ability to leverage brand value propositions; (xiv) changes in availability and relative costs of labor and contract farmers and our ability to maintain good relationships with team members, labor unions, contract farmers and independent producers providing us livestock, including as a result of our ~~plan to relocate~~relocation of certain corporate team members to our world headquarters in Springdale, Arkansas; (xv) issues related to food safety, including costs resulting from product recalls, regulatory compliance and any related claims or litigation; (xvi) the effect of climate change and any legal or regulatory response thereto; (xvii) compliance with and changes to regulations and laws (both domestic and foreign), including changes in accounting standards, tax laws, environmental laws, agricultural laws and occupational, health and safety laws; (xviii) adverse results from litigation; (xix) risks associated with leverage, including cost increases due to rising interest rates or changes in debt ratings or outlook; (xx) impairment in the carrying value of our goodwill or indefinite life intangible assets; (xxi) our participation in a multiemployer pension plan; (xxii) volatility in capital markets or interest rates; (xxiii) risks associated with our commodity purchasing activities; (xxiv) the effect of, or changes in, general economic conditions; (xxv) impacts on our operations caused by factors and forces beyond our control, such as natural disasters, fire, bioterrorism, pandemics, armed conflicts or extreme weather; (xxvi) failure to maximize or assert our intellectual property rights; (xxvii) effects related to changes in tax rates, valuation of deferred tax assets and liabilities, or tax laws and their interpretation; and (xxviii) those factors discussed within Item 1, Item 1A and Item 7 of our Annual Report on Form 10-K for the year ended ~~October 1, 2022~~September 30, 2023 and our other periodic filings with the SEC.

Item 3.Quantitative and Qualitative Disclosures About Market Risk

Market risk relating to our operations results primarily from changes in commodity prices, interest rates and foreign exchange rates, as well as credit risk concentrations. To address certain of these risks, we enter into various derivative transactions as described below. If a derivative instrument is accounted for as a hedge, depending on the nature of the hedge, changes in the fair value of the instrument either will be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings, or be recognized in other comprehensive income (loss) until the hedged item is recognized in earnings. The ineffective portion of an instrument’s change in fair value is recognized immediately.

Further, we hold certain positions, primarily in grain and livestock futures that either do not meet the criteria for hedge accounting or are not designated as hedges. With the exception of normal purchases and normal sales that are expected to result in physical delivery, we record these positions at fair value, and the unrealized gains and losses are reported in earnings at each reporting date.

The sensitivity analyses presented below are the measures of potential changes in fair value resulting from hypothetical changes in market prices related to commodities. Sensitivity analyses do not consider the actions we may take to mitigate our exposure to changes, nor do they consider the effects such hypothetical adverse changes may have on overall economic activity. Actual changes in market prices may differ from hypothetical changes.

Commodities Risk

We purchase certain commodities, such as grains and livestock, during normal operations. As part of our commodity risk management activities, we use derivative financial instruments, primarily forwards and options, to reduce the effect of changing prices and as a mechanism to procure the underlying commodity. However, as the commodities underlying our derivative financial instruments can experience significant price fluctuations, any requirement to mark-to-market the positions that have not been designated or do not qualify as hedges could result in volatility in our results of operations. Contract terms of a hedge instrument closely mirror those of the hedged item providing a high degree of risk reduction and correlation. Contracts designated and highly effective at meeting this risk reduction and correlation criteria are recorded using hedge accounting. We generally do not hedge anticipated transactions beyond 18 months. The following table presents a sensitivity analysis resulting from a hypothetical change of 10% in market prices as of ~~April 1,~~March 30, 2024, and September 30, 2023, ~~and October 1, 2022,~~ on the fair value of open positions. The fair value of such positions is a summation of the fair values calculated for each commodity by valuing each net position at quoted forward and option prices. The market risk exposure analysis included both derivatives designated as hedge instruments and derivatives not designated as hedge instruments.

Effect of 10% change in fair value in millions
April 1, 2023 October 1, 2022
Livestock:
Live Cattle $ 25 $ 14
Lean Hogs 20 30
Grain:
Corn 39 40
Soybean Meal 29 25


Effect of 10% change in fair value			in millions
	March 30, 2024		September 30, 2023
Livestock:
Live Cattle	$	7	$	68
Lean Hogs	20		10
Grain:
Corn	35		23
Soybean Meal	15		22

Interest Rate Risk

At ~~April 1, 2023,~~March 30, 2024, we had variable rate debt of ~~$624~~$1,519 million with a weighted average interest rate of ~~5.5%~~6.9%. A hypothetical 10% increase in interest rates effective at ~~April 1, 2023, and October 1, 2022,~~March 30, 2024 would ~~not have a significant effect on variable~~increase annualized interest ~~expense.~~expense by approximately $10 million.

Additionally, changes in interest rates impact the fair value of our fixed-rate debt. At ~~April 1, 2023,~~March 30, 2024, we had fixed-rate debt of ~~$8,306~~$9,441 million with a weighted average interest rate of ~~4.5%~~4.7%. Market risk for fixed-rate debt is estimated as the potential increase in fair value, resulting from a hypothetical 10% decrease in interest rates. A hypothetical 10% change in interest rates would have changed the fair value of our fixed-rate debt by approximately ~~$198~~$259 million at ~~April 1, 2023~~March 30, 2024 and $215 million at ~~October 1, 2022.~~September 30, 2023. The fair values of our debt were estimated based on quoted market prices and/or published interest rates.

We are subject to interest rate risk associated with our pension and post-retirement benefit obligations. Changes in interest rates impact the liabilities associated with these benefit plans as well as the amount of income or expense recognized for these plans. Declines in the value of the plan assets could diminish the funded status of the pension plans and potentially increase the requirements to make cash contributions to these plans. See Part II, Item 8, Notes to Consolidated Financial Statements, Note 15: Pensions and Other Postretirement Benefits in our Annual Report on Form 10-K for the fiscal year ended ~~October 1, 2022,~~September 30, 2023, for additional information.

Foreign Currency Risk

We have foreign exchange exposure from fluctuations in foreign currency exchange rates primarily as a result of certain receivable and payable balances. The primary currencies we have exposure to are the Australian dollar, the Brazilian real, the British pound sterling, the Canadian dollar, the Chinese renminbi, the European euro, the Malaysian ringgit, the Mexican peso, and the Thai baht. We periodically enter into foreign exchange forward and option contracts to hedge some portion of our foreign currency exposure. A hypothetical 10% change in foreign exchange rates related to the foreign exchange forward and option contracts would have had a ~~$14~~$29 million and ~~$25~~$17 million impact on pretax income at ~~April 1,~~March 30, 2024, and September 30, 2023 ~~and October 1, 2022~~ respectively.

Concentration of Credit Risk

Refer to our market risk disclosures set forth in our Annual Report filed on Form 10-K for the fiscal year ended ~~October 1, 2022,~~September 30, 2023, for a detailed discussion of quantitative and qualitative disclosures about concentration of credit risks.

~~EBITDA Non-GAAP Reconciliations~~

~~A reconciliation of net income to EBITDA is as follows (in millions, except ratio data):~~

Six Months Ended Fiscal Year Ended Twelve Months Ended
April 1, 2023 April 2, 2022 October 1, 2022 April 1, 2023
Net income $ 229 $ 1,959 $ 3,249 $ 1,519
Less: Interest income (16) (6) (17) (27)
Add: Interest expense 173 197 365 341
Add: Income tax expense 75 538 900 437
Add: Depreciation 500 466 945 979
Add: Amortization (a) 115 124 246 237
EBITDA $ 1,076 $ 3,278 $ 5,688 $ 3,486
Total gross debt $ 8,321 $ 8,930
Less: Cash and cash equivalents (1,031) (543)
Less: Short-term investments (1) (7)
Total net debt $ 7,289 $ 8,380
Ratio Calculations:
Gross debt/EBITDA 1.5x 2.6x
Net debt/EBITDA 1.3x 2.4x

(a) Excludes the amortization of debt issuance and debt discount expense of $5 million for the six months ended April 1, 2023 and April 2, 2022 and $11 million for the fiscal year ended October 1, 2022 and the twelve months ended April 1, 2023 as it is included in interest expense.

EBITDA represents net income, net of interest, income tax expense, depreciation and amortization. Net debt to EBITDA represents the ratio of our debt, net of cash and short-term investments, to EBITDA. EBITDA and net debt to EBITDA are presented as supplemental financial measurements in the evaluation of our business. We believe the presentation of these financial measures helps management and investors to assess our operating performance from period to period, including our ability to generate earnings sufficient to service our debt, and enhances understanding of our financial performance and highlights operational trends. These measures are widely used by investors and rating agencies in the valuation, comparison, rating and investment recommendations of companies; however, the measurements of EBITDA and net debt to EBITDA may not be comparable to those of other companies, which limits their usefulness as comparative measures. EBITDA and net debt to EBITDA are not measures required by or calculated in accordance with GAAP and should not be considered as substitutes for net income or any other measure of financial performance reported in accordance with GAAP or as a measure of operating cash flow or liquidity. EBITDA is a useful tool for assessing, but is not a reliable indicator of, our ability to generate cash to service our debt obligations because certain of the items added to net income to determine EBITDA involve outlays of cash. As a result, actual cash available to service our debt obligations will be different from EBITDA. Investors should rely primarily on our GAAP results, and use non-GAAP financial measures only supplementally, in making investment decisions.

Item 4.Controls and Procedures

Evaluation of Disclosure Controls and Procedures

An evaluation was performed, under the supervision and with the participation of management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “1934 Act”)). Based on that evaluation, the CEO and CFO have concluded that, as of ~~April 1, 2023,~~March 30, 2024, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the 1934 Act) during the quarter ended ~~April 1, 2023~~March 30, 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.Legal Proceedings

Refer to the description of the Broiler Antitrust Civil Litigation, the Broiler Chicken Grower ~~Litigation,~~Investigation, the Pork Antitrust Litigation, the Beef Antitrust Litigation and the Wage Rate Litigation under the heading “Commitments and Contingencies” in Part I, Item 1, Notes to Consolidated Condensed Financial Statements, Note 15: Commitments and Contingencies, which discussion is incorporated herein by reference. Other than as set forth below and in our Annual Report on Form 10-K for the fiscal year ended ~~October 1, 2022,~~September 30, 2023, there are no additional updates to the legal proceedings involving the Company and/or its subsidiaries.

On July 8, 2022, Barber Foods, LLC (“Barber Foods”), an indirect wholly owned subsidiary of the Company, received correspondence from the Environmental Protection Agency (“EPA”) extending an opportunity to confer and negotiate a Consent Agreement and Final Order (“CAFO”) for each of two Barber Foods frozen poultry storage facilities located in Portland, Maine (the “Maine Facilities”). Included in the correspondence was a proposed CAFO for each facility. Each proposed CAFO alleges violations of the Clean Air Act resulting from EPA compliance inspections conducted in June 2019 at the Maine Facilities. The alleged violations include the failure to comply with process safety information requirements, failure to comply with mechanical integrity requirements and failure to adequately identify, evaluate, and control hazards. The proposed CAFOs set forth a proposed aggregate civil penalty of $541,243 for the alleged violations at the Maine Facilities. On September 28, 2022, the Maine Facilities entered into CAFOs with the EPA in an aggregate amount of $300,000 which fully resolved this matter. O~~While Barber Foods~~ ~~neither admits nor denies the specific factual allegations contained in the CAFOs, we believe that the settlement was in the best interests of the Company and its shareholders to avoid the uncertainty, risk, expense and distraction of protracted litigation.~~

Onn June 19, 2005, the Attorney General and the Secretary of the Environment of the State of Oklahoma filed a complaint in the United States District Court for the Northern District of Oklahoma against Tyson Foods, Inc., three subsidiaries and six other poultry

integrators. The complaint, which was subsequently amended, asserts a number of state and federal causes of action including, but not limited to, counts under the Comprehensive Environmental Response, Compensation, and Liability Act, Resource Conservation and Recovery Act, and state-law public nuisance theories. Oklahoma alleges that the defendants and certain contract growers who were not joined in the lawsuit polluted the surface waters, groundwater and associated drinking water supplies of the Illinois River Watershed through the land application of poultry litter. Oklahoma’s claims were narrowed through various rulings issued before and during trial and its claims for natural resource damages were dismissed by the district court in a ruling issued on July 22, 2009, which was subsequently affirmed on appeal by the Tenth Circuit Court of Appeals. A non-jury trial of the remaining claims including Oklahoma’s request for injunctive relief began on September 24, 2009. Closing arguments were held on February 11, 2010. On January 18, 2023, the district court entered Findings of Fact and Conclusions of Law in favor of the State of Oklahoma and directed the parties to confer in an attempt to reach an agreement on appropriate remedies by March 17, 2023. On March 17, 2023, the parties received a 90-day extension from the district court and ~~continue~~continued to confer on appropriate remedies. On June 12, 2023, the Court ordered the parties to mediation. The parties attended an in-person mediation on October 12, 2023, but were unable to reach a resolution. Defendants subsequently filed a post-trial motion to dismiss, which remains pending.

Other Matters

As of ~~October 1, 2022,~~September 30, 2023, we had approximately ~~142,000~~139,000 team members and, at any time, have various employment practices matters outstanding. In the aggregate, these matters are important to the Company, and we devote considerable resources to managing employment issues. Additionally, we are subject to other lawsuits, investigations and claims (some of which involve substantial amounts) arising out of the conduct of our business. While the ultimate results of these matters cannot be determined, they are not expected to have a material adverse effect on our consolidated results of operations or financial position.

Item 1A.Risk Factors

Our business is subject to a variety of risks and uncertainties. These risks are described in this Quarterly Report on Form 10-Q and elsewhere in our other filings with the SEC, including Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended ~~October 1, 2022.~~September 30, 2023. The risks identified in such reports have not changed in any material respect.

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

The table below provides information regarding our purchases of Class A stock during the three months ended ~~April 1, 2023.~~March 30, 2024.

Period
Total Number of Shares Purchased (2)
Average
Price Paid
per Share
Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs (3)
Maximum Number of
Shares that May Yet Be
Purchased Under the Plans
or Programs (1)
January 1, 2023 to January 28, 2023 79,743 $ 64.44 — 7,301,400
January 29, 2023 to March 4, 2023 64,883 62.62 — 7,301,400
March 5, 2023 to April 1, 2023 41,959 58.05 — 7,301,400
Total 186,585 $ 62.37 — 7,301,400


Period	Total Number of Shares Purchased (2)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3)	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (1)
December 31, 2023 to January 27, 2024	133,117	$	54.67	—	7,301,400
January 28, 2024 to March 2, 2024	111,399	54.32		—	7,301,400
March 3, 2024 to March 30, 2024	87,763	56.34		—	7,301,400
Total	332,279	$	55.00	—	7,301,400

(1)On February 7, 2003, we announced that our Board of Directors had approved a program to repurchase up to 25 million shares of outstanding Class A common stock from time to time in open market or privately negotiated transactions. On May 3, 2012, our Board of Directors approved an additional 35 million shares, on January 30, 2014, our Board of Directors approved an additional 25 million shares and on February 4, 2016, our Board of Directors approved an additional 50 million shares, in each case, authorized for repurchase under our share repurchase program. The program has no fixed or scheduled termination date.

(2)We purchased ~~186,585~~332,279 shares during the three months ended ~~April 1, 2023~~March 30, 2024 that were not made pursuant to our previously announced stock repurchase program but were purchased to fund certain Company obligations under our equity compensation plans. These transactions included ~~164,457~~298,870 shares purchased in open market transactions and ~~22,128~~33,409 shares withheld to cover required tax withholdings related to the vesting of restricted stock. Shares withheld to cover required tax withholdings related to the vesting of restricted stock do not reduce our total share repurchase authority.

(3)Shares purchased during the three months ended ~~April 1, 2023~~March 30, 2024 pursuant to our previously announced stock repurchase program.

Item 3.Defaults Upon Senior Securities

None.

Item 4.Mine Safety Disclosures

Not Applicable.

Item 5.Other Information

Because this Quarterly Report on Form 10-Q is being filed within four business days from the date of a reportable event, we have elected to make the following disclosure in this Quarterly Report on Form 10-Q instead of in a Current Report on Form 8-K under Items 1.01Director and ~~2.03.~~

~~Entry into a Material Definitive Agreement.~~

~~BofA Term Loan Agreement~~

On May 3, 2023, Tyson Foods, Inc. (the “Company”) entered into a Term Loan Agreement with the lenders from time to time party thereto, Bank of America, N.A., as the administrative agent, and BofA Securities, Inc., as lead arranger (the “BofA Term Loan Agreement”).

In connection with the BofA Term Loan Agreement, the Company obtained a $1 billion term loan facility which the Company may draw at any time during the ten business days following the effective date of the BofA Term Loan Agreement (the “BofA Term Loan Facility'). Interest on borrowings under the BofA Term Loan Agreement will accrue and be payable, at the Company’s option, at an annual rate equal to (a) Term SOFR (as defined in the BofA Term Loan Agreement) plus the applicable margin, as described below, or (b) the Alternate Base Rate (as defined in the BofA Term Loan Agreement) plus the applicable margin, as described below. The BofA Term Loan Agreement contains customary provisions specifying alternative interest rate calculations to be employed at such time as Term SOFR (as defined in the BofA Term Loan Agreement) ceases to be available as a benchmark for establishing the interest rate on borrowings. The BofA Term Loan Facility matures three years following the date of the initial borrowing under the BofA Term Loan Facility. The applicable margin will correspond to the Company’s corporate credit rating from S&P or Moody’s, as applicable, as calculated in accordance with the terms of the BofA Term Loan Agreement.Officer Trading Arrangements

The covenants under the BofA Term Loan Agreement include negative covenants limiting or restricting our ability to: create liens and encumbrances; incur debt; merge, dissolve, liquidate or consolidate; make acquisitions and investments; dispose of or transfer assets; change the nature of our business; engage in certain transactions with affiliates; and enter into hedging transactions, in each case, subject to certain qualifications and exceptions. In addition, the BofA Term Loan Agreement requires the Company to maintain a minimum interest expense coverage ratio (Consolidated EBITDA to Consolidated Cash Interest Expense, each as defined in the BofA Term Loan Agreement) of at least 3.50 to 1.0 asNone of the ~~end of each fiscal quarter (in each case, calculated on~~Company's directors or executive officers adopted, modified, or terminated a ~~trailing four fiscal quarter basis).~~

~~The BofA Term Loan Agreement contains customary events of default, including non-payment of obligations under other debt facilities, violation of affirmative~~Rule 10b5-1 trading arrangement or negative covenants, material inaccuracy of representations, non-payment of other material debt, bankruptcy or insolvency, ERISA and certain judgment defaults, change of control and failure of any guarantee to remain in full force and effect.

The Company may use the proceeds of borrowings under the BofA Term Loan Agreement to finance general working capital needs and for other general corporate purposes, including in connection with any acquisition. The Company entered into the BofA Term Loan Agreement, in part, to finance the repayment of near-term commercial paper and senior note indebtedness.

Certain of the lenders party to the BofA Term Loan Agreement, the administrative agent and each of their affiliates engage in transactions with, and perform services for, the Company and its affiliates in the ordinary course of business and have engaged, and may in the future engage, in other commercial banking transactions and underwriting, investment banking, financial advisory and other financial services transactions with the Company and its affiliates.

~~The foregoing description of the BofA Term Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the BofA Term Loan Agreement,~~ a ~~copy of which is filed herewith as Exhibit 10.3 and incorporated by reference herein.~~

~~CoBank Term Loan Agreement~~

On May 3, 2023, the Company also entered into a Term Loan Agreement with the lenders from time to time party thereto, CoBank, ACB, as the administrative agent, and CoBank, ACB, as the sole lead arranger (the “CoBank Term Loan Agreement”).

~~The CoBank Term Loan Agreement provides for a $750 million delayed-draw term loan facility which the Company may draw in one or more borrowings at any time~~non-Rule 10b5-1 trading arrangement during the six months following the effective date of the CoBank Term Loan Agreement (the “CoBank Term Loan Facility”). Interest on borrowings under the CoBank Term Loan Facility will accrue and be payable, at the Company’s option, at an annual rate equal to (a) the Adjusted Term SOFR Rate (as defined in the CoBank Term Loan Agreement) plus the applicable margin, (b) the Alternate Base Rate (as defined in the CoBank Term Loan Agreement) plus the applicable margin, as described below, (c) the Adjusted Daily Simple SOFR Rate (as defined in the CoBank Term Loan Agreement) plus the applicable margin, as described below, or (d) the Quoted Rate (as defined in the CoBank Term Loan Agreement). The CoBank Term Loan Agreement contains customary provisions specifying alternative interest rate calculations to be employed at such time as Term SOFR (as defined in the CoBank Term Loan Agreement) ceases to be available as a benchmark for establishing the interest rate on borrowings. The CoBank Term Loan Facility matures five years from May 3, 2023, the date of closing. The applicable margin will correspond to the Company’s corporate credit rating from S&P or Moody’s, as applicable, as calculated in accordance with the terms of the CoBank Term Loan Agreement.

The covenants under the CoBank Term Loan Agreement include negative covenants limiting or restricting our ability to: create liens and encumbrances; incur debt; merge, dissolve, liquidate or consolidate; make acquisitions and investments; dispose of or transfer assets; change the nature of our business; engage in certain transactions with affiliates; and enter into hedging transactions, in each case, subject to certain qualifications and exceptions. In addition, the CoBank Term Loan Agreement requires the Company to maintain a minimum interest expense coverage ratio (Consolidated EBITDA to Consolidated Cash Interest Expense, each as defined in the CoBank Term Loan Agreement) of at least 3.50 to 1.0 as of the end of each fiscalCompany's quarter ~~(in each case, calculated on a trailing four fiscal quarter basis).~~

The CoBank Term Loan Agreement contains customary events of default, including non-payment of obligations under other debt facilities, violation of affirmative or negative covenants, material inaccuracy of representations, non-payment of other material debt, bankruptcy or insolvency, ERISA and certain judgment defaults, change of control and failure of any guarantee to remain in full force and effect.

The Company may use the proceeds of borrowings under the CoBank Term Loan Agreement to refinance existing indebtedness of the Company and its subsidiaries, including indebtedness outstanding under the Company’s commercial paper program, and for other general corporate purposes, including in connection with any acquisition. The Company entered into the CoBank Term Loan Agreement, in part, to finance the repayment of near-term commercial paper and senior note indebtedness.

The foregoing description of the CoBank Term Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the CoBank Term Loan Agreement, a copy of which is filed herewith as Exhibit 10.4 and incorporate by reference herein.

~~Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.~~

~~The information described above under “Entry into a Material Definitive Agreement” is incorporated herein by reference.~~ended March 30, 2024.

Item 6.Exhibits

The Exhibit Index below contains a list of exhibits filed or furnished with this Form 10-Q.


Exhibit No.		Exhibit Description

4.1	**	Supplemental Indenture, dated March 8, 2024, by and between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, N.A. (formerly The Chase Manhattan Bank, N.A.)), as trustee, for the Senior Notes due 2029 (previously filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed March 8, 2024, and incorporated herein by reference).

4.2	**	Form of 5.400% Senior Note due 2029 (previously filed as Exhibit 4.3 to the Company’s Current Report on Form 8-K filed March 8, 2024, and incorporated herein by reference).

4.3	**	Supplemental Indenture, dated March 8, 2024, by and between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, N.A. (formerly The Chase Manhattan Bank, N.A.)), as Trustee, for the Senior Notes due 2034 (previously filed as Exhibit 4.4 to the Company’s Current Report on Form 8-K filed March 8, 2024, and incorporated herein by reference).

4.4	**	Form of 5.700% Senior Note due 2034 (previously filed as Exhibit 4.5 to the Company’s Current Report on Form 8-K filed March 8, 2024, and incorporated herein by reference).

10.1	* **	~~Offer letter~~Consulting Agreement, dated February 1, 2024, between ~~Tyson Foods, Inc.~~the Company and ~~Wes Morris~~Noel W. White.

~~10.2~~	* **	~~Offer letter between Tyson Foods, Inc. and Brady Stewart~~

~~10.3~~	**	~~Term Loan Agreement, dated May 3, 2023, among Tyson Foods, Inc., the lenders party thereto, Bank of America, N.A. as administrative agent, and BofA Securities Inc. as lead arranger.~~

~~10.4~~	**	~~Term Loan Agreement, dated May 3, 2023, among Tyson Foods, Inc., the lenders party thereto, CoBank ACB, as administrative agent, and CoBank FCB, as sole lead arranger.~~

























31.1	**	Certification of Chief Executive Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	**	Certification of Chief Financial Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	***	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	***	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following information from our Quarterly Report on Form 10-Q for the quarter ended ~~April 1, 2023~~,March 30, 2024, formatted in iXBRL (inline eXtensible Business Reporting Language): (i) Consolidated Condensed Statements of Income, (ii) Consolidated Condensed Statements of Comprehensive Income, (iii) Consolidated Condensed Balance Sheets, (iv) Consolidated Condensed Statements of Shareholders' Equity, (v) Consolidated Condensed Statements of Cash Flows, and (vi) the Notes to Consolidated Condensed Financial Statements.

104		Cover Page Interactive Data File formatted in iXBRL.

	*	Indicates a management contract or compensatory plan or arrangement.
	**	Filed herewith
	***	Furnished herewith

4342

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	TYSON FOODS, INC.


Date: May ~~8, 2023~~6, 2024		/s/ John R. Tyson
		John R. Tyson
		Executive Vice President and Chief Financial Officer

Date: May ~~8, 2023~~6, 2024		/s/ ~~Phillip W. Thomas~~Lori J. Bondar
		~~Phillip W. Thomas~~Lori J. Bondar
		Senior Vice President ~~Controller~~ and Chief Accounting Officer

4443


	Three months ended April 2, 2022
	Retail(a)		Foodservice(b)		International(c)		Industrial and Other(d)		Intersegment		Total
Beef	$	2,213	$	1,264	$	808	$	603	$	146	$	5,034
Pork	430		122		267		401		345		1,565
Chicken	1,699		1,590		277		485		35		4,086
Prepared Foods	1,410		897		44		42		—		2,393
International/Other	—		—		565		—		—		565
Intersegment	—		—		—		—		(526)		(526)
Total	$	5,752	$	3,873	$	1,961	$	1,531	$	—	$	13,117


	Six Months Ended				Fiscal Year Ended		Twelve Months Ended
	April 1, 2023		April 2, 2022		October 1, 2022		April 1, 2023

Net income	$	229	$	1,959	$	3,249	$	1,519
Less: Interest income	(16)		(6)		(17)		(27)
Add: Interest expense	173		197		365		341
Add: Income tax expense	75		538		900		437
Add: Depreciation	500		466		945		979
Add: Amortization (a)	115		124		246		237
EBITDA	$	1,076	$	3,278	$	5,688	$	3,486


Total gross debt					$	8,321	$	8,930
Less: Cash and cash equivalents					(1,031)		(543)
Less: Short-term investments					(1)		(7)
Total net debt					$	7,289	$	8,380

Ratio Calculations:
Gross debt/EBITDA					1.5x		2.6x
Net debt/EBITDA					1.3x		2.4x