The German sports equipment manufacturer Adidas suffered a heavy drop in its net income in 2022, suffering the full brunt of the end of its collaboration with Kanye West, the group said on Thursday.
Adidas’ net profit fell to 254 million euros, compared to 1.49 billion euros generated in 2021. The end of the collaboration with the American rapper Kanye West after the anti-Semitic remarks made by the latter, should end in 2023 with an operating loss of 700 million euros, Adidas said.
‘The figures speak for themselves. We don’t have the results we should have had,” said new Adidas boss Bjorn Gulden, who took over in January.
“Adidas has what it takes to succeed… We need to put this all in order but I am convinced that over time Adidas will be able to shine again,” he added. stating that it will take time.
Adidas ended its collaboration with Kanye West – now known as Ye – in October and its highly profitable ‘Yeezy’ collection designed with West.
On the rebound
For 2023, Adidas emphasizes that the impact of this disruption will continue to be felt. Turnover is expected to fall by around 1.2 billion euros and operating profit by around 500 million euros.
Adidas provides, in the event of total depreciation of the stock of Yeezy sneakers, an additional charge of 500 million euros. The group also foresees costs of 200 million to review its strategy and prepare for the rebound in 2024.
In October 2022 after anti-Semitic remarks by Kayne West, Adidas announced in a press release ‘the decision to immediately end the partnership with Ye’.
“Adidas does not tolerate anti-Semitism or any other form of hate speech,” the group said, adding that it was ending the manufacture of the rapper’s Yeezy-branded products.
The collaboration between the three-stripe brand and the American star has long been one of the most successful in the fashion world.
In development since 2014, the rapper’s Yeezy sneaker collection has enjoyed phenomenal success that helped make Kanye West a billionaire.
Relations between the two partners had deteriorated significantly last year in connection with the various escapades of the star.
Ye was suspended from Twitter after tweeting that he was going to attack Jews in a post that the social network has since deleted for breaking its rules.
He was also suspended from Instagram.
Previously, the rapper had criticized commercial initiatives of Adidas taken, according to him, without his agreement.
/ATS