In a stunning turn of events, the previous high-flying stock of Tyson Foods crashed today after the company reported an unexpected 14% decrease in sales, significantly missing Wall Street estimates. Shareholders headed for the exits as the company announced CEO Donnie Smith “stepped down” and added that full year earnings will also fall short of expectations.
While the company attributed the decline in sales to lower beef prices and higher costs, the facts don’t support their claim as beef sales have been consistently declining as a result of health warnings. Their PR machine’s excuse is further made porous by the Board’s shocking decision to let go of its CEO. It’s a decision they unlikely would have made if their sales decline was simply the result of external pricing issues.
A more reasonable explanation for Tyson’s sales drop is that the public has become increasingly fed up with their horrific abuse of animals, mistreatment of employees, lawsuits, shareholder and consumer deception, and felony pollution of air and water. And, of course, the plant-based meat market is also compassionate, environment-friendly, healthier, and booming and likely contributed to their woes. Now it’s clear why Tyson invested in Beyond Meat last month. They likely saw their weak sales data and decided they needed to diversify their business model.
Tyson announced today that they’re going to increase capital spending from $700 million to $1 billion to improve worker safety, animal welfare, and food safety. These steps would not be necessary if the decline in sales was simply a matter of competitive pricing. It’s a monumental admission that their egregious and repeated violations are decreasing sales.
Tyson Chairman John Tyson thanked outgoing CEO Donnie Smith for leading the company “with a conscience.” Ironically, several articles about the Tyson stock crash and Smith’s firing today cite mounting pressure from animal-rights activists and the public over their hideous cruelty toward animals, something that happens when people have no conscience. Tyson continues to live in their alternate universe where compassion is cruelty for profit. Fortunately, the public is seeing through their facade. The Tyson collapse today provides a powerful reminder that nothing can stop the animal rights movement.