United States: Adidas has stated that it intends to sell the remaining inventory of Yeezy sneakers from its now-dissolved collaboration with Kanye West for at least some cost.
In 2022, the fashion designer and rapper Ye severed his relationship with the company due to a string of antisemitic remarks he had made on social media. But Yeezy sneakers are still in high demand in the resale market, so the demand hasn’t decreased.
Currency fluctuations have cost the company $1.08 billion. According to a statement from Adidas, the German sportswear juggernaut’s finances were hurt last year by ending the Yeezy line of business and lowering wholesale prices to reduce inventory levels.
Adidas reported an operating profit of $289 million in 2023 despite facing considerable challenges, and it anticipates nearly doubling that amount this year.
Chief executive Bjørn Gulden of the company stated, “The improvement is due to the better operating business of around €100 million and the decision to not write off €268 million of Yeezy inventory.”
At the beginning of 2023, Gulden was hired by competitor sportswear company Puma to spearhead Adidas’ turnaround after the company’s breakup with the Yeezy brand left it holding unsold sneakers valued at approximately $1.3 billion.
Despite selling some of its Yeezy stock last year, the partnership’s net sales were about $486 million less than in 2022.
Adidas said that, in an effort to recover losses from the once lucrative partnership, it would now sell the remaining Yeezy stock for “at least” the cost of producing the goods.
Nonetheless, the company’s most recent outlook retained the possibility of writing off its remaining Yeezy items, which would come with a $324 million price tag.
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