Revenue from selling products under the Yeezy brand brought Adidas in the third quarter of 2023 $375 million. At the same time, total sales of the sports giant decreased in the reporting period by 6.4% to 6 billion euros. Adidas’ net profit fell 20.5% to €280 million.
The weak operating performance was caused, among other things, by lower Adidas sales in North America. Yeezy sales were below last year’s level despite the decision to restart runoff sales. In an updated forecast, Adidas expects an operating loss of €100 million for 2023. The company had previously predicted losing up to €700 million.
About a year ago, Adidas broke up with Kanye West and, for a long time, refused to sell Yeezy collections. Eventually, this year, it was decided to start a partial stock sale. A final decision on all the inventory has not yet been made.
Adidas CEO Bjørn Gulden on Wednesday tried to look past Q4, saying in a statement that the last months of the year will be dedicated to laying “the foundation for an improving 2024 and a successful 2025 and 2026.”
“To be very honest with you, for the story of Adi going forward, how are we performing in Q4 doesn’t really matter,” he told analysts on a Wednesday morning conference call.
Adidas is also currently gearing up to release merchandise created through a collaboration with fashion designer Jerry Lorenzo’s Fear of God brand. According to Goulden, who joined Adidas earlier this year, collaborations with the brand have been plagued by delays over the past three years.
“The Fear of God thing I think is a good example of working with a partner and not having a clear setup of what is expected,” he said. “I think it’s wrong expectations …and actually a lot of misunderstandings of what it means to work on a performance product and then on a lifestyle product.”
