Contrary to expectations, Adidas was in the black last year and maintained sales. According to preliminary figures, the operating result was 268 (2022: 669) million euros, the world’s second largest sporting goods group announced on Wednesday evening in Herzogenaurach. CEO Björn Gulden had recently expected a loss of around 100 million euros. But the Christmas business went better than expected, he said, as did the sell-out of “Yeezy” shoes from the ended partnership with the US rapper “Ye” (Kanye West).
Adidas is not writing off the rest of the sneakers, but wants to at least sell them to cover costs in 2024. Group sales remained flat after adjusting for currency effects, but Adidas had expected a decline. Calculated in euros, sales fell by five percent – more than one billion – to 21.4 billion euros, partly due to the devaluation of the Argentine peso.
“Of course we know that our financial results are not good,” said Gulden. “But we are in the process of making adidas a good company again.” He needs time for that. The current year will get off to a slow start with stagnating sales. For the second half of the sports year with the European Football Championship in Germany and the Olympic Games in Paris, Gulden expects double-digit growth rates again – excluding the “Yeezy” effect. For the full year, Adidas forecast a currency-adjusted sales increase of around five percent and an operating profit of 500 million euros – “despite no profit contribution from Yeezy, the significant unfavorable currency effects, the ongoing challenges in North America, our continued investments in marketing and sales and a world full of uncertainties,” as Gulden said.
The outlook disappointed stock market traders: Adidas shares fell by more than nine percent in late trading. According to LSEG data, analysts had expected Nike’s rival to make an operating profit of almost 1.3 billion euros this year. The smaller local rival Puma recently frightened the markets with weak figures and the share price collapsed. Adidas was initially able to reassure the analysts. Gulden now put investors off to 2025: “This year is the next building block to make Adidas a company with double-digit growth and an operating margin of ten percent.”
A year ago, the Norwegian warned of a loss of up to 700 million euros in 2023. But then he brought himself to throw the “Yeezy” models designed by Ye, which had long since been produced, onto the market despite the scandal surrounding the rapper’s anti-Semitic statements. Two online sales campaigns alone brought Adidas 700 million euros in sales and 300 million euros in operating profit. Adidas was still around half a billion euros short of sales without new versions of the best-sellers of recent years. Goods worth 250 million euros are now left. According to our own market researchers, they could at least be sold at cost price, explained Gulden. This saved Adidas from having to write off the shoes at the turn of the year.