After cutting ties with Kanye West, Adidas has suffered a huge operating loss.
A Major Loss
According to Daily News, this is the first loss of this magnitude for the brand in three decades. On Wednesday, Adidas announced that the net loss in its final 2022 quarter was $540 million due to unsold Yeezy products.
CEO Bjorn Gulden noted that the company expects to experience an operating loss of $738 million in 2023 and referred to this time period as “a transition year.”
Looking Ahead To The Future
“We can then start to build a profitable business again in 2024,” Gulden said.
The outlet reported that Adidas had not witnessed an operating loss across a full year on this scale in the past 31 years.
How Did We Get Here?
As previously reported by AfroTech, the sportswear company officially gave West the boot in October 2022 following alleged anti-Semitic remarks.
“adidas does not tolerate antisemitism and any other sort of hate speech,” read a statement from the organization at the time. “Ye’s recent comments and actions have been unacceptable, hateful, and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness.”
Furthermore, Adidas was prepared to take a hit following its decision.
“This is expected to have a short-term negative impact of up to €250 million on the company’s net income in 2022 given the high seasonality of the fourth quarter,” the company said in a press release.
For West, Adidas wasn’t the only company to sever ties. His partnership with Gap also came to a close following his polarizing remarks. However, the Yeezy creator took the moment as an opportunity to stand on his own two feet.
“It’s time for me to go it alone,” West told Bloomberg. “It’s fine. I made the companies money. The companies made me money. We created ideas that will change apparel forever. Like the round jacket, the foam runner, the slides that have changed the shoe industry. Now it’s time for Ye to make the new industry. No more companies standing in between me and the audience.”