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adidas’ legendary run as a profitable company for more than 30 years has come to an end.
And who’s fault is it you ask? Kanye West.
The rapper’s string of antisemitic remarks led to the company cutting ties with him in October 2022. Nearly two years later, it’s still feeling the effects of the decision, having posted a net loss of $63 million.
“We didn’t have a great year in 2023,” adidas CFO Harm Ohlmeyer told CNN.
Other contributors to the multimillion-dollar loss include falling sales in America, which reached 16% in 2023, which was a big hit as the continent is its second-biggest market. Another clue points to a tax bill that shot up in 2023 but is expected to stabilize in 2024, ensuring their bottom line is better this year.
adidas said in a statement, “Going forward, the company expects the tax rate to normalize again as its operating profit improves.”
It wasn’t all bad news for the three stripes, as it’s seeing a pick-up in China’s interest in its product, with an 8% rise in 2024 and an even more impressive 37% in the final months of 2023.
The fractured relationship with Ye is still on the rocks, with several sales taking place to get rid of existing stock. West has taken issue with adidas’ actions of still selling his sneakers, specifically 350s, in colorways he didn’t approve.
adidas may have had the money to make up for its massive loss, but making good on its promise to donate proceeds to groups fighting antisemitism after the Ye drama took precedence.
After unloading all the previously unsold Yeezy merchandise, adidas pocketed around $1.3 billion with more than $150 million being sent to those anti-hate groups.
Here’s the latest Ye response to his ongoing beef with adidas:
