Adidas has significantly raised its full-year profit forecast, driven by strong sales of its Samba and Gazelle trainers.
- The third quarter performance was exceptionally strong, surpassing previous expectations and boosting overall financial guidance.
- A 46% rise in operating profit highlights the effectiveness of Adidas’ strategic initiatives amidst challenging market conditions.
- The brand’s decision to sell parts of its unsold Yeezy inventory contributed positively to this financial uplift.
- Adidas anticipates a further increase in currency-neutral sales, adjusting its expectations accordingly.
Adidas has revised its financial outlook for the year, increasing its profit expectations to £1bn. This marks the third adjustment to its full-year guidance, underpinned by a better-than-expected third quarter performance. The company’s iconic Samba and Gazelle trainers have played a pivotal role in this financial resurgence, contributing to a 7% rise in sales, amounting to £5.39bn.
This upward revision in profit forecast comes as a direct result of a remarkable 46% increase in operating profit, which grew from £342m to £500m. Key to this growth was a strategic decision to sell parts of the remaining Yeezy inventory, resulting in an additional contribution of £41.8m. Such measures have demonstrated Adidas’ ability to navigate complexities in the retail market effectively.
Chief Executive Bjørn Gulden has been instrumental in steering this turnaround, especially after the brand’s split with Ye, formerly known as Kanye West. The separation had initially posed challenges, leaving Adidas with unsold Yeezy stock worth £1bn. However, adapting swiftly, the sportswear giant expects no further profit from these sales in the upcoming quarter.
In an ambitious move, Adidas now forecasts a 10% increase in currency-neutral sales, a notable upgrade from the previously predicted high-single-digit growth. This revision underscores the brand’s confidence and strategic capabilities in harnessing market momentum.
The company continues to harness its product appeal and brand strength, evident in the sustained interest in its classic trainer lines. Adidas’ proactive measures and market responsiveness illustrate a significant recovery and an optimistic outlook for sustained growth.
Adidas’ strategic manoeuvres and strong product performance signal a robust recovery and promising future prospects in the sportswear industry.
