Adidas suffered huge loss for the first time in many years, breaking the deal with Kanye West was costly
The results of the year 2023 have been disappointing for Adidas. Terminating its contract with Kanye West at the end of 2022 was a huge loss for the company. The company said it faced a loss of 75 million euros (about $82 million) in 2023. Earlier the company had earned a profit of 612 million euros. This is the first time that the company has suffered a loss.
Adidas, a manufacturer of sportswear, experienced significant losses in 2023. The business announced on Wednesday that it had severed ties with American rapper Kanye West and sustained a significant loss. The business did note, though, that it is quickly making up for the losses.
Adidas, a German company, ended Kanye West's contract in 2022 after the rapper posted anti-Semitic remarks on his social media accounts.
Together, Adidas and Kanye West produced the wildly popular Yeezy shoe line. The company experienced a significant setback upon the expiration of this agreement when it was unable to sell a sizable inventory of these shoes. His revenue was severely reduced as a result.
Adidas reported that it has suffered a loss of 75 million euros (about 82 million dollars) in the year 2023. This is the first time in many years that the company has been at a loss. Earlier the company had earned a profit of 612 million euros.
After the termination of its partnership with Kanye West, Adidas also changed the top brass. The CEO position went to rival Puma's Bjorn Gulden. Even if the outcomes are poor, he said, it will take time for the company to change. He went on to say that the 2023 results were not as bad as initially thought, that we should improve by 2025, and that by 2026, the company should be in good shape.
Revenue for the company dropped by 5% to 21.4 billion euros. The country that has lost the most from the Yeezy shoe sales halt is America. On the other hand, the business is introducing the Yeezy shoe line gradually.
The company will sell Yeezy shoes at cost price. It is estimated that this will generate revenue of about 250 million euros. There has also been relief news for the company from China, where its sales have increased.
