Sales of remaining Yeezy stocks will be discontinued for the time being
The sporting goods manufacturer Adidas has reported a decline in sales and profits for the third quarter of the current 2023 financial year. Group sales in the period from July to September reached almost 6,0 billion euros, 6,4 percent below the same quarter of the previous year. However, adjusted for exchange rate changes, revenue grew by one percent.
Adidas has temporarily stopped selling Yeezy products from controversial scandal rapper Kanye West. There will be no further sales campaigns this year, said CEO Björn Gulden, after two successful campaigns this year. Adidas initially stopped selling Yeezy shoes, which once brought Adidas $1,2 billion in sales, after the rapper's anti-Semitic comments. This year the sale of remaining stocks brought in 750 million euros in sales. It is unclear whether there will be further sales next year. “No decisions have been made yet.”
Overall, Adidas had sales of 16,6 billion euros in the first nine months of this year - a decrease of four percent compared to the same period last year. Due to lower depreciation and better business, Adidas is expecting a loss of 100 million euros, after expecting a loss of 700 million euros at the beginning of the year. “Of course we know that our current performance is not good enough,” said Gulden. The company is still struggling with high inventory levels. These have now been reduced by 23 percent to 4,8 billion euros - bought with sometimes high discounts. Stock levels among retail customers have also improved, “albeit at a slower rate.” Inventories in the US market in particular would continue to impact business for a while.
Sales of retro shoes such as the Samba or Spezial models are currently “first class”. However, there were not enough of these available, otherwise more could have been sold, Gulden regrets. “We have increased supply, but are still a long way from meeting all of the current demand.”
Gulden is hoping for a boost from next year's major sporting events such as the Olympic Games in Paris and the European Football Championship in Germany. The recently difficult China business is also expected to pick up more strongly again.
Footwear sales increased six percent on a currency-adjusted basis in the third quarter. This reflects double-digit increases in Adidas Originals as well as in the soccer and basketball categories.
