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Sportswear giant Adidas could lose up to $1.3 billion in revenue in 2023 if it can’t sell its remaining Yeezy inventory.
CNBC report The company has been going through a difficult time over anti-Semitic comments since splitting from rapper Kanye West (now known as Ye) in October 2022. Adidas has previously considered the potential negative impact of not selling its products and is now considering what to do with its remaining inventory.
Analysts say a failure to sell Yeezy in 2023 could reduce operating income by nearly $605 million. Additionally, sales are expected to decline at a high-single-digit pace this year. As a result, Adidas may have to write off the rest of his Yeezy inventory, resulting in one-off costs of approximately $242 million. As a result, 2023 losses could total about $750 million.
Following the news, Adidas CEO Björn Gulden released a statement saying: “The numbers speak for themselves. Right now we are not performing as we should.” . The announcement immediately had an impact on stock prices, with Adidas shares he dropping 9.5%.
It’s another economic hit to earnings for Adidas, which is trying to fix its Yeezy inventory problem. What will happen remains uncertain, but investors and analysts are waiting to see if Adidas can turn things around.