Adidas has improved its profit predictions for the third time this year, driven by robust brand momentum.
- The company’s third-quarter performance exceeded expectations, significantly boosting operating profits.
- Samba and Gazelle trainers have played a central role in this financial success.
- Currency-neutral sales are now expected to rise by approximately 10%.
- Adidas is effectively navigating the challenges posed by its recent separation from Ye.
Adidas has once again revised its profit expectations, marking the third occasion this year that the company has done so. This adjustment reflects the brand’s considerable momentum, particularly in the third quarter, which outperformed initial forecasts.
Operating profits saw a remarkable rise, climbing by 46% from £342 million to £500 million. This growth includes a £41.8 million contribution from the sale of Yeezy inventory, showcasing how Adidas has capitalised on existing resources effectively.
The popularity of Adidas’ Samba and Gazelle trainers has significantly contributed to a 7% increase in total sales, reaching £5.39 billion. This surge highlights the brand’s ability to capture consumer interest with its classic and trendy footwear offerings.
As a result of the outstanding performance, the company now forecasts its operating profit to hit £1 billion, an increase from the previous estimate of £837 million. This adjustment stems from a prediction of a 10% rise in currency-neutral sales, a notable improvement over the previously anticipated high-single-digit growth.
This positive outlook comes amidst a turnaround led by CEO Bjørn Gulden, particularly after the company’s split with rapper Ye, formerly Kanye West. Despite being left with unsold Yeezy shoes valued at £1 billion, Adidas anticipates no further profit from the sale of these in the fourth quarter, suggesting a strategic focus on its core offerings.
Adidas’s strategic focus on core products like Samba and Gazelle under strong leadership ensures it remains resilient and forward-looking in a challenging market.
