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FRANKFURT, Germany (AP) — Adidas saw operating earnings dwindle in the first three months of the year as the German sportswear company's breakup with the rapper formerly known as Kanye West and his popular Yeezy shoe brand cost it 400 million euros ($441 million) in lost sales.
Profit was down to 60 million euros from 437 million euros in the same quarter a year ago, while the profit margin shrank to a bare 1.1%. Net sales declined 1%, to 5.27 billion euros, and would have risen 9% with the Yeezy line, the company said Friday.
Losing the Yeezy brand is “of course hurting us,” new CEO Bjorn Gulden said in a statement, which didn't explain what Adidas would do with 1.2 billion euros worth of unsold Yeezy shoes a year after the company cut ties with the rapper now known as Ye.
The breakup, which followed Ye's antisemitic comments on social media and in interviews, will reduce earnings by 500 million euros in the coming year, the Herzogenaurach-based company has said.
Gulden did say the results for the Herzogenaurach-based company were “a little better than we had expected” as the company seeks to restart growth and move beyond the breakup with Ye.
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