Adidas earnings take beating on breakup with Ye, China slump

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Adidas' breakup with the rapper formerly known as Kanye West and the inability to sell his popular Yeezy line of shoes helped batter earnings at the end of last year, leading to a net loss of 513 million euros (US$540 million).

The fourth-quarter loss, also attributed to higher supply costs and slumping revenue in China, contrasts with a profit of 213 million euros in the same period a year ago, the German shoe and sportswear maker said Wednesday.

Adidas split with Ye in October following the rapper's antisemitic remarks on social media and in interviews, facing pressure along with other brands to end ties. The company is now grappling to find ways to replace its banner Yeezy line, which analysts have said amounted to as much as 15 per cent of its net income.

Fourth-quarter net sales were up a bare 1.3 per cent at 5.21 billion euros from the same quarter a year ago, held back by around 600 million euros in lost revenue by the decision to halt the partnership with Ye. For the full year, the Herzogenaurach, Germany-based company said it made net profit of 638 million euros on sales that rose 6 per cent, to 22.5 billion euros.

 

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All this money isn't the sneakers. The loss is from paying Kanye. Not the actual cost of the sneakers. Which is probably $2 bucks a unit. Lol

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