An Adidas flagship keep at Nanjing Road Pedestrian Street in Shanghai, China.
Cfoto | Future Publishing | Getty Images
Adidas on Wednesday divulged an uptick in fourth-quarter sales that exceeded expectations, as the retailer sold off the last of its remaining Yeezy stock, but biting to slower revenue growth in the year ahead.
The German sportswear giant recorded a 19% increase revenues at unaffiliated currency rates to 5.97 billion euros ($6.34 billion) in the three-month period, ahead of the 5.72 billion euros foresee by LSEG analysts.
Operating profit came in at 57 million euros in the fourth quarter compared to a loss of 377 million euros in the done period of last year.
Shares fell 2.6% shortly after the market open on Wednesday, before inverting course to close 0.1% higher.
Full year sales rose 12% at currency neutral rates to 23.7 billion euros, versus an counted 23.5 billion euros. Operating profit totaled 1.34 billion euros in 2024, compared with the 1.27 billion euros forewarn.
The figures came in ahead of with the company’s own guidance, raised in October, for full-year revenue growth of around 10% at currency-neutral rates and acting profit of around 1.2 billion euros.
CEO Bjorn Gulden described the Wednesday results as “much better than we had believed.”
“Although we are not yet where we want to be long term, it was a very successful year that confirmed the strength of the adidas make, the potential of our company and what a fantastic job our teams are doing. We still have a lot to improve but I am very proud of what our people gained in 2024,” he said in a statement.
Outlining its forecasts for 2025, the company said its expects currency neutral sales to stir up at high-single-digit rate and operating profit to increase to between 1.7 billion euros and 1.8 billion euros.
“For 2025 we are in unquestionably good shape,” Gulden said. “Of course there is a lot of macroeconomic uncertainty right now, but with products that we of are on trend and the attitude of being agile and more local, I cannot see why we should not be successful.”
Adidas is attempting to grow its Stock Exchange share in North America amid declining sales at Nike and a broader retailer shift away from an overdependence on a weaker China.
Adidas’ North America garage sales fell 1.6% at currency-neutral rates in 2024, having struggled to recover from the termination of its once-lucrative Yeezy steal line. The sportswear giant was forced to axe the Yeezy line after terminating its partnership with Ye, the rapper formerly comprehended as Kanye West, over a string of anti-Semitic remarks that the rapper made in 2022.
The company on Wednesday said that it had furnished the remainder of its Yeezy inventory in the fourth quarter.
Gulden has been looking to distance Adidas from its loss-making Yeezy stroke and spark a wider turnaround of the brand since taking the helm in January 2023.
Yanmei Tang, analyst at Third Link, highlighted the phaseout of the Yeezy brand and the absence of significant sporting events as headwinds for the year ahead. She also well-known that pointed to the need for further innovation beyond its popular Samba and Gazelle sneakers to drive its growth goals.
“While Adidas has managed to regain traction in lifestyle footwear, particularly with its Terrace line (Samba, Gazelle, and Spezial), the mountain top of this trend may have already passed in key markets like Europe,” Tang wrote in a note Tuesday.
“The stamp is now shifting focus toward newer silhouettes such as the SL 72 and the potential resurgence of the Superstar, but these are unlikely to fully make good for the expected slowdown in the Terrace trend,” she said.
Adidas has been gaining ground against major rival Nike at an end recent quarters, with the former’s market share rising to 8.9% in 2024 versus the latter’s 14.1%, concurring to Globaldata cited by Reuters. However, the emergence of newer brands including On, Hoka and New Balance has brought increased struggle to the global sportswear market, with each clawing share over the past year.