Adidas slumps as Kanye split triggers new profit warning
Adidas (ADSGn.DE) shares slumped as much as 12.6% on Friday after the sportswear maker warned it could plunge to a loss this year for the first time in three decades, in the latest downgrade triggered by its split from Kanye West.
Inventory of the rapper and fashion designer’s Yeezy brand, with price tags for sneakers and apparel of up to $700 a pair, could be written off entirely, resulting in a 700 million euro ($749 million) loss this year, the company said on Thursday.
Just by not selling the stock, revenues would take a 1.2 billion euro hit in 2023, while operating profit would fall by about 500 million euros to around break-even, the rival to Nike (NKE.N) added.
“The numbers speak for themselves. We are currently not performing the way we should,” said CEO Bjorn Gulden, who joined Adidas on Jan. 1 after switching from rival Puma (PUMG.DE) and has promised a “year of transition” to make the sportswear giant profitable again.
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