Adidas’ decision to fire Kanye West last year still has a negative effect on the company’s bottom line.
Today, Adidas CEO Bjrn Gulden released the company’s first-quarter financial results for 2023, noting a
$441 million decline in year-over-year sales, primarily in North America, Greater China, and Europe,
Middle East, and Africa (EMEA) regions. This decline is largely attributable to the brand’s decision to end
its successful Yeezy business in October 2022.
In addition, Gulden reiterated remarks he made in February that were similar in that the company has
not decided what it intends to do with its current Yeezy items. The company revealed today that, if it
decides against repurposing its remaining stock, it will see an additional $551 million decrease in
operating profit this year and up to $221 million in one-time charges.
Operating losses in 2023 would be $772 million as a result of this. A decision to not repurpose Yeezy
stock might result in an overall $1.3 billion sales loss this year, according to Gulden’s statement at the
financial forecast meeting in February, a figure that was also mentioned in the report released today.
In October, Adidas stated that it was ending its relationship with West after he publicly expressed his
antisemitic beliefs and criticized the company for months. Investors in Adidas last week filed a class
action lawsuit against the company, claiming that top executives at the sportswear giant, including
Adidas Chief Financial Officer Harm Ohlmeyer and former CEO Kasper Rrsted, were aware of the dangers
of working with Ye “as early as 2018” but did not take any preventative steps to reduce potential
financial exposure in the event of a sudden fallout between the two organizations.
Gulden praised the brand’s Samba, Gazelle, and Campus brands for performing well in all markets
despite the brand disclosing its predicted losses as a result of the Yeezy debacle, while Adidas’
collaborative releases with Bad Bunny, Ronnie Fieg, and Gucci have all been major sellers.