Adidas’s net income fell heavily in 2022, according to preliminary results released on Thursday, with the German sportswear giant predicting major operating losses this year after ending a tie-up with Kanye West.
Net income for last year was 254 million euros ($272 million), down from 1.49 billion in 2021, the figures showed.
The end of the partnership with controversial rapper West would be a major contributor to the company suffering operating losses of up to 700 million euros this year, Adidas said.
“The numbers speak for themselves. We are currently not performing the way we should,” said Adidas CEO Bjorn Gulden, who was named to the job in November, as part of efforts to turn the company around.
“Adidas has all the ingredients to be successful… We need to put the pieces back together again, but I am convinced that over time we will make Adidas shine again.
“But we need some time.”
Adidas halted its tie-up with West — now known formally as Ye — in October after he made a series of anti-Semitic outbursts.
The firm said it would end production of the highly successful “Yeezy” line designed together with West, which has brought in huge profits.
In its financial guidance for 2023 published Thursday, Adidas said there would be a “significant adverse impact” from not selling existing Yeezy stock.
This would lower revenues by around 1.2 billion euros, and operating profit by around 500 million euros, it said.
Adidas also expects one-off costs of up to 200 million euros in 2023 — and it said it could report an operating loss of as much as 700 million euros.
