Adidas has stated that it will sell the remaining Yeezy shoes

Adidas has stated that it intends to sell the remaining inventory of Yeezy sneakers from its now-dissolved collaboration with Kanye West for at least cost. After Ye, a rapper and fashion designer, posted a number of antisemitic remarks on social media in 2022, the company severed its relationship with him. Yeezy sneakers are still quite popular on the resale market, therefore demand for them hasn’t decreased. Currency changes caused the company to lose €1 billion ($1.08 billion; £850 million). Adidas said in a statement that last year’s cancellation of the Yeezy line and price reductions to wholesalers to reduce inventory levels had an effect on the German sportswear behemoth’s profitability.

 

Adidas reported an operating profit of €268 million in 2023 while overcoming considerable challenges, and it anticipates nearly doubling that amount this year. Chief executive Bjørn Gulden of the company stated, “The improvement is due to the better operating business of around €100 million and the decision to not write off €268 million of Yeezy inventory.” At the beginning of 2023, Adidas was left with unsold sneakers worth approximately €1.2 billion following its divorce with the Yeezy brand. To drive the turnaround, Mr. Gulden was brought in from rival sportswear company Puma. Net sales from the partnership were around €450 million less in 2022 even though the company sold some of its Yeezy stock last year.

 

Adidas announced that, in an effort to recover losses from the once lucrative collaboration, it will now sell the remaining Yeezy stock for “at least” the cost of creating the shoes. The company’s most recent projection did, however, still contain the possibility of writing off its remaining Yeezy goods, which would come with a €300 million price tag. Adidas added that the depreciation of the Argentine Peso at the end of 2023 had a negative impact on it. Dec. saw the Argentine pear depreciated by over 50% due to the “economic shock therapy” that new president Javier Milei claimed the nation need. The company also issued a warning, stating that this year’s depreciation will continue to hurt its profitability.

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