Adidas brings in $437M from Yeezy inventory sale
Adidas-Ye partnership ended in October
Adidas terminates Kanye West partnership over antisemitic rants
Red Banyan founder and CEO Evan Nierman and Ericho Communications CEO Eric Yaverbaum debate how Adidas managed the Ye controversy on 'The Claman Countdown.'
The first sale of remaining Yeezy inventory brought hundreds of millions of dollars in revenue for German sports apparel maker Adidas.
The company said Thursday revenue from the release, which included popular models that had been initiated last year, totaled about $437 million (400 million euros).
Adidas announced nearly three months ago it would put up for sale the products it had remaining from its partnership with Ye, the rapper formerly known as Kanye West.
The company ended the partnership after Ye made a series of antisemitic remarks. It also committed to making donations with a "significant amount" of money from the sales.
ADIDAS WILL SELL MORE OUTSTANDING YEEZY INVENTORY
A split photo of the Adidas logo on a sign and Kanye West at the Supreme Courthouse in New York City (REUTERS/Andrew Kelly/File Photo I Steve Eichner/WWD/Penske Media via Getty Images / Reuters Photos)
The company has said remaining Yeezy shoes and other products were worth $1.3 billion.
Adidas started offloading the Yeezy apparel in May and said it is sending anti-discrimination and anti-hate groups about $120 million from the sales. Some of the money has already been received by organizations, according to reports.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| ADDYY | ADIDAS AG | 111.71 | +0.87 | +0.78% |
The roughly $437 million generated by the Yeezy sale in May represented an amount on par with the second quarter of 2022, Adidas said.
"The sale of the first part of the Yeezy inventory did, of course, help both our top and bottom line in the quarter," said CEO Bjorn Gulden.
Adidas saw a "positive impact" of about $164 million (150 million euros) from the May Yeezy release on its second-quarter operating profit, which totaled $192 million (176 million euros). Meanwhile, its quarterly revenue was roughly $5.85 billion (5.34 billion euros).
GET FOX BUSINESS ON THE GO BY CLICKING HERE
The company noted it did not sell any Yeezy apparel in the first quarter.
The results of the Yeezy sale previously prompted Adidas to change to a "mid-single-digit" revenue drop rate and a narrower $492 million (450 million euros) operating loss in its 2023 financial forecast. Its current outlook for the year did not factor into the ongoing second release of apparel from the terminated partnership.
A sign advertises Yeezy shoes made by Adidas at Kickclusive, a sneaker resale store. (AP Photo/Seth Wenig / AP Newsroom)
More Yeezy products went up for sale Wednesday via digital channels in the second release. That offloading, which will also involve donating proceeds, is taking place in phases, a strategy the company previously said was meant to "help manage demand whilst ensuring a fair and premium experience for consumers."
ADIDAS FACES YEEZY-FOCUSED CLASS-ACTION LAWSUIT FILED BY SHAREHOLDERS
Adidas has identified the Anti-Defamation League, the Philonise & Keeta Floyd Institute for Social Change and the Foundation to Combat Antisemitism as groups it is contributing to.
Adidas AG
Round two of Yeezy sales "would further improve the company’s results" if it goes well, the company said.
Adidas halted its partnership with Ye in October, roughly nine years after it started.