If Adidas is unable to sell its existing Yeezy stock, it could lose about 1.2 billion euros ($1.3 billion) in revenue in 2023.
After a series of antisemitic comments, the German sportswear company ended its partnership with rapper and fashion designer Ye, formerly known as Kanye West, as the face of Yeezy in October.
The company announced late Thursday that it is evaluating what to do with the inventory and has already accounted for the "significant adverse impact" of not selling the products.
If the company does not move the products, operating profit will fall by around 500 million euros, and Adidas expects sales to fall in the high single digits in 2023. Adidas may decide to write off its remaining Yeezy merchandise.
As a result of the announcements, stocks fell 11% on Friday morning.
Adidas' worst-case scenario for the year is a 700 million euro loss in 2023, owing to one-time costs of up to 200 million euros.
“The numbers speak for themselves. We are currently not performing the way we should,” Adidas CEO Bjørn Gulden said in a press release.
According to unaudited figures, Adidas' revenues increased 1% in 2022, while operating profit fell from nearly 2 billion euros in 2021 to 669 million euros in 2022.
(Source:www.flipboard.com)
After a series of antisemitic comments, the German sportswear company ended its partnership with rapper and fashion designer Ye, formerly known as Kanye West, as the face of Yeezy in October.
The company announced late Thursday that it is evaluating what to do with the inventory and has already accounted for the "significant adverse impact" of not selling the products.
If the company does not move the products, operating profit will fall by around 500 million euros, and Adidas expects sales to fall in the high single digits in 2023. Adidas may decide to write off its remaining Yeezy merchandise.
As a result of the announcements, stocks fell 11% on Friday morning.
Adidas' worst-case scenario for the year is a 700 million euro loss in 2023, owing to one-time costs of up to 200 million euros.
“The numbers speak for themselves. We are currently not performing the way we should,” Adidas CEO Bjørn Gulden said in a press release.
According to unaudited figures, Adidas' revenues increased 1% in 2022, while operating profit fell from nearly 2 billion euros in 2021 to 669 million euros in 2022.
(Source:www.flipboard.com)
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