Adidas has rebounded from its challenging partnership with rapper Kanye West and anticipates achieving profits of €700m (£598m) in 2024.
In February, the German athletic apparel powerhouse announced its intention to offload the remaining Yeezy sneakers from its collaboration with West at minimum cost price.
Adidas’ optimistic remarks on Tuesday follow a month after the company reported its first losses in three decades.
The brand produces iconic shoes like the Samba, Gazelle, and Campus models.
The revised figures, according to the company, surpass initial forecasts by €200m, largely attributed to a stronger-than-anticipated performance in the first quarter.
Adidas revealed that its quarterly operating profit soared to €336m, a significant increase from €60m a year earlier, when it faced challenges stemming from the split with West.
Additionally, Adidas disclosed that it generated €150m in sales from Yeezy products during the quarter, yielding a profit of around €50m.
The company expects to dispose of the remaining Yeezy inventory for approximately €200m later this year, with no additional profit margin.
Last year, Adidas committed to donating a portion of the sales proceeds to charitable organizations dedicated to combating hate.
Adidas cut ties with West in November 2022 over antisemitic comments he made on social media, but the company still has a diverse fan base with rich and powerful clients.
Sunak’s ‘fulsome’ apology
Acknowledging that his association with Samba might not align with the preferences of other wearers, Mr. Sunak delivered a heartfelt apology on LBC radio, emphasizing his enduring commitment to the Adidas brand.
While the multinational corporation has cautioned that its profits will suffer due to the Yeezy situation, it has also highlighted the impact of the devaluation of the Argentine peso at the close of 2023.
Adidas has been the official supplier of jerseys for Argentina’s national football team for several decades.
Competing sportswear company Puma has also indicated that the devaluation of Argentina’s currency affected its financial performance, given that the region represents its largest and most rapidly expanding market.