Adidas reports a significant boost in operating profit projections due to a strong sales quarter.
- The company’s operating profit is now expected to reach nearly £1bn for 2024.
- Third quarter operating profit jumped to €598m, up from €409m in the previous year.
- Footwear and apparel sales saw significant growth, with a remarkable 14% rise.
- Adidas attributes success to its strategic growth across regions and product lines.
Adidas, the sportswear leader, has revised its full-year profit forecast upward, anticipating an operating profit close to £1bn by year-end 2024. This optimistic outlook follows a robust performance that outpaced Wall Street predictions. The company now aims for an operating profit of approximately €1.2bn, an increase from the prior €1bn estimate.
This comes on the heels of a strong third quarter, where Adidas achieved an operating profit of €598m, rising from €409m the previous year. The net income from ongoing operations also enjoyed a boost, hitting €449m. Such results underscore the brand’s double-digit growth in both its lifestyle and performance sectors.
Adidas’ brand saw a 14% surge, particularly in the third quarter, with its UK headquarters situated in Stockport. The company noted a 10% increase in currency-neutral sales, driven by significant gains in its brand sector. In his statement, CEO Bjørn Gulden highlighted the impressive financial performance: “The third quarter was a very strong quarter for us and again better than expected.”
Gulden expressed pride in the company’s all-encompassing growth, stating that all regions, channels, and product divisions saw advances. Additionally, the company reported double-digit growth in both its lifestyle and performance areas, illustrating a balanced business model: “Double-digit growth in both lifestyle and performance shows the currently good ‘balance’ in our business,” he said.
Adidas experienced a promising turnaround in Greater China and saw a timely positive shift in the North American market in recent quarters, enhancing mid-term future confidence. The CEO attributed this success to the brand’s strength and the efforts of its team globally.
Footwear sales were particularly strong, enjoying a 14% increase due to high demand in the originals and performance segments, including running and football. Apparel, including accessories, also saw robust gains, buoyed by collaborations with names like Wales Bonner.
Furthermore, Adidas recorded a 13% rise in its wholesale revenue and a substantial 7% growth in the direct-to-consumer sector. E-commerce revenue soared by 25% when excluding the Yeezy lineup, displaying the successful adoption of online sales strategies.
Regionally, Adidas’ European sector enjoyed an 18% growth surge, further cementing its market strength in the continent.
Adidas’ strategic growth initiatives have bolstered its financial outlook, promising a successful end to 2024.
