Adidas shares fall after warning of unsold Yeezy shares
“The numbers speak for themselves. We are currently not operating as we should,” Adidas CEO Bjorn Gulden said in a press release.
Jeremy Meller / Contributor / Getty Images
Adidas could lose about 1.2 billion euros ($1.3 billion) in revenue in 2023 if it can’t sell its existing Yeezy shares.
The German sportswear company ended a partnership with rapper and fashion designer Ye, formerly known as Kanye West, the face of Yeezy, in October after he made a series of anti-Semitic comments.
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The company said late Thursday it was evaluating what to do with inventory, adding that it had already accounted for the “significant adverse effects” of not selling products.
Operating profit will fall by around 500 million euros if the company fails to change products, and Adidas expects sales to decline at a high single-digit rate in 2023. Adidas may decide to retire the remaining Yeezy products.
Shares fell 9.5% on Friday morning as traders reacted to the announcements.
The company also forecasts one-time costs of up to €200 million, leaving Adidas with a worst-case scenario for the year of a loss of €700 million in 2023.
“The numbers speak for themselves. We are currently not operating as we should,” Adidas CEO Bjorn Gulden said in a press release.
Adidas’ revenue increased by 1% in 2022, according to unaudited data, while operating income fell from nearly 2 billion euros in 2021 to 669 million euros in 2022.
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