Adidas has sold the final pair of Yeezy sneakers, and after finishing his partnership with controversial rapper YE, the turnaround has come into view, but now the sneaker giant is challenging sales from President Trump's tariffs.
The German-based company predicted operating profit on Wednesday between $1.8 billion and $1.9 billion in 2025, down below the $2.3 billion forecast for analysts.
Adidas CEO Bjorn Gulden warned that President Trump's import tariffs (25% of goods from Canada and Mexico, 20% in China could exacerbate inflation and allow consumers to cut spending.
However, he acknowledged the forecast was conservative and said the company's goals were higher. Adidas has consistently beat its revenue forecasts.
“When we enter 2025 with all the volatility, we don't know what will happen with US tariffs. We don't know what that inflation will cause,” Garden said. “Of course, being on the safe side is good.”
Trump has also threatened to impose tariffs on Vietnam, the leading manufacturer of adidas products around the world.
Since taking the helm in 2023, Garden has gained market share from its struggled rival Nike, helping Adidas recover after Kanye West's anti-Semitism explosion destroyed Yeezy's collaboration.
The athletic brand revealed Wednesday that it sold its final pair of Yeezy sneakers from stock after splitting from YE in October 2022.
“We don't have Yeezy Shoe left, it's all for sale and that episode is behind us,” Adidas Chief Financial Officer Hart Ohlmeyer said at a press conference.
Losing Yeezy has hurt adidas' sales over the past few years, especially in the US, where Yee's brand was particularly popular.
North American sales fell 2% in 2024, “just because Yeezy's sales fell significantly.”
The company began selling the remaining Yeezy stock in May 2023, pledging to donate some of its profits to organizations fighting anti-Semitism, such as the anti-liberal league.
Adidas said it secured about $280 million for donations, or about half of its operating profit from selling Yeezy shares in 2023 and 2024.
The company expects annual revenue to rise in 2025 at a “single-digit high” rate. This is lower than last year's 12% jump.
However, aside from the impact of losing Yeezy, Adidas said it expects growth of over 10%.
Adidas has been able to capture market share while Nike's decline thanks to the success of the Samba and Gazelle retro sneaker revival, but is looking for new growth sources.
“The first boom in adidas samba and gazelles set the pace. These iconic styles remain a presence in the mass market, but appear to be saturated.”
“Low Profile” thin-slit sneakers and running shoes for daily wear are some of the new products Adidas is betting on, Garden said.
The company also confirmed reports that it plans to cut up to 500 jobs at its German headquarters through restructuring efforts starting in January.
With post wire
