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The Adidas logo is seen at an official store at the Adidas World of Sports campus in Herzogenaurach, Germany, July 3, 2023. Anna Szilagyi, EPA-EFE/File

epa10724809 The Adidas logo is seen at an official store at the Adidas World of Sports campus in Herzogenaurach, Germany, 03 July 2023.  EPA-EFE/ANNA SZILAGYI

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Adidas World of Sports campus in Herzogenaurach

Agence France-Presse

<div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span class="fr-img-caption fr-fic fr-dib" style="width:960px"><span class="fr-img-wrap"><img src="https://od2-image-api.abs-cbn.com/prod/editorImage/171035049586811573476.jpg" style="width:960px" class="fr-fic fr-dib" alt="The Adidas logo is seen at an official store at the Adidas World of Sports campus in Herzogenaurach, Germany, July 3, 2023. Anna Szilagyi, EPA-EFE/File"/><span class="fr-inner" style="text-align:left">The Adidas logo is seen at an official store at the Adidas World of Sports campus in Herzogenaurach, Germany, July 3, 2023. <em>Anna Szilagyi, EPA-EFE/File</em></span></span></span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">FRANKFURT, Germany -- Adidas reported its first loss in over three decades Wednesday due to the fallout from the end of its collaboration with Kanye West, but the company insisted it was starting to turn its fortunes around.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">In late 2022, the German sportswear giant ended its contract with the US rapper, now known formally as Ye, after he triggered an outcry with a series of anti-Semitic social media posts.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Adidas and West had designed the blockbuster line of Yeezy trainers together, and the collapse of the partnership robbed the company of a vital revenue stream, and left it saddled with a massive stock of unsold footwear.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Adidas registered a loss of 75 million euros ($82 million) in 2023 following a profit of 612 million euros the previous year. It was the company&#x27;s first net loss since 1992, Adidas said.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><a href="https://news.abs-cbn.com/business/2024/2/1/adidas-says-it-will-unload-yeezy-shoes-without-loss-1005"></a><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap"><a class="fr-green fr-strong" href="https://news.abs-cbn.com/business/2024/2/1/adidas-says-it-will-unload-yeezy-shoes-without-loss-1005">READ: Adidas says it will unload Yeezy shoes without loss</a></span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">But CEO Bjorn Gulden, who was brought in to lead the company from rival outfitter Puma shortly after the West tie-up fell apart, struck an upbeat tone.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">&quot;It will take a long time to turn the business (around)... The result is of course not good enough,&quot; he told a press conference.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">&quot;But it builds the base to actually achieve what we have promised.&quot;</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">The 2023 results were not as bad as had been previously feared, and by &quot;2025 we should already be a good company and by 2026 we should be a really healthy company,&quot; he said.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap"><strong>- &#x27;Transition year&#x27; -</strong></span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Revenues fell by five percent to 21.4 billion euros, and were hit particularly hard in the United States due to the discontinuation of sales of Yeezy trainers.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Adidas has been gradually seeking to offload the Yeezy trainers, with two sales in 2023 bringing in 750 million euros. However, this is below the 1.2 billion euros of revenue they had generated in 2022.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">The company expects to sell off the final Yeezy shoes this year at cost, resulting in revenues of around 250 million euros.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">While sales fell heavily in North America, and are expected to keep declining this year, they picked up strongly in China, in good news from an important market which had suffered due to the country&#x27;s tough coronavirus curbs.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Gulden has sought to focus on promoting classic Adidas trainers -- such as Samba, Gazelle and Campus -- and Adidas said sales of the products were growing well.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Adidas is forecasting a pick-up in business for 2024, with sales expected to grow in the &quot;mid single-digit&quot; range, and operating profit to come in at around 500 million euros, double the figure for 2023.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">With Germany to host the European football championships in June-July, and Paris the Olympics right after, Adidas is poised to bag additional sales from jerseys and related merchandise.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Still, the company&#x27;s forecast was several hundred million euros below what analysts were predicting, and some were disappointed the company did not boost what they saw as an underwhelming outlook.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Nevertheless, Adidas shares were up around four percent in late afternoon trading.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">Deutsche Bank said there were no surprises in the results, and that 2024 was set to be &quot;another transition year&quot; for the company.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap">&quot;All eyes are on the future prize and the building blocks to get there,&quot; it added.</span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap"><strong>© Agence France-Presse</strong></span></div><div dir="ltr" style="line-height:1.38;text-align:justify;margin-top:0pt;margin-bottom:10pt"><a href="https://news.abs-cbn.com/life/10/20/21/what-to-expect-from-adidas-largest-store-in-ph"></a><span style="color:#000000;background-color:transparent;text-decoration:none;vertical-align:baseline;white-space:pre-wrap"><a class="fr-green fr-strong" href="https://news.abs-cbn.com/life/10/20/21/what-to-expect-from-adidas-largest-store-in-ph">READ: What to expect from Adidas&#x27; largest store in PH</a></span></div><div><br/></div><div><br/></div>

<p>Adidas reported its first loss in over three decades Wednesday due to the fallout from the end of its collaboration with Kanye West, but the company insisted it was starting to turn its fortunes around.</p>

Adidas reported its first loss in over three decades Wednesday due to the fallout from the end of its collaboration with Kanye West, but the company insisted it was starting to turn its fortunes around.

Adidas reports first loss in 30 years on Kanye fallout

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Adidas reports first loss in 30 years on Kanye fallout

Agence France-Presse,

Sam Reeves

Published March 14, 2024 01:27 AM PHT

Read More:

adidas

Kanye West

Germany

Yeezy shoes

Paris Olympics

Deutsche Bank

Bjorn Gulden

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