Adidas has reported a 1% fall in total revenue in Q1 of this year after ending its collaboration with Kanye West. The loss of the Yeezy business cut sales by €400m (£350m), but Adidas said that sales were up 9% when the impact of the Yeezy business was excluded.
The sportswear giant said it was benefiting from the current trend for “terrace” style trainers and was seeing “extraordinary demand” for its Samba, Gazelle and Campus brands. Adidas chief executive Bjorn Gulden said the loss of Yeezy is “of course hurting us”. The company scrapped its tie-up with West in October last year following the rapper’s anti-Semitic comments.
At the time, the firm said: “Adidas does not tolerate antisemitism and any other sort of hate speech.” Adidas said that if it decided not to “repurpose” its remaining unsold Yeezy stock, this would hit its operating profit by €500m this year.
The company still has to decide what to do with the remaining products, and whether it will sell them or scrap them. Mr Gulden the firm was narrowing its options on the Yeezy stock, and the company was getting “closer and closer” to a decision.
Pippa Stephens, senior apparel analyst at GlobalData, said that while Adidas was “unable to reverse its past mistakes, it must now quickly come to a decision on what to do with its remaining Yeezy stock, to avoid angering its investors even further”. “Should it decide to sell it, it risks damaging its brand reputation even further, so must ensure it does so sensitively to avoid upsetting customers.”