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Adidas has revealed their intention to liquidate the remaining inventory of Yeezy shoes.
On January 31st, the German sports company shared its initial findings for 2023, detailing the impact of discontinuing Kanye West’s Yeezy line on their business. The company stated that this resulted in a decrease of approximately €500m ($543.69m) in comparison to the previous year.
Adidas initially intended to get rid of approximately $324 million worth of Yeezy products after severing ties with the rapper in 2022 due to his offensive comments towards the Jewish community. However, they have now reconsidered and aim to sell the remaining Yeezy inventory at the original purchase price.
According to Bjørn Gulden, CEO of Adidas, our research on consumer, retail, and trade has revealed that we can successfully sell the remaining inventory at its original cost by 2024. Therefore, any leftover inventory that was damaged or significantly flawed in size has been written off.
After making a series of anti-semitic remarks, West was temporarily banned from X (previously known as Twitter). As a result, Adidas ended their partnership with Yeezy and released a statement on October 25th, 2022 denouncing all forms of hate speech, including anti-semitism.
Adidas released a statement condemning antisemitism and all forms of hate speech. They expressed their disapproval of Ye’s recent remarks and behavior, deeming them unacceptable, hateful, and potentially harmful. These actions go against the company’s core principles of promoting diversity, inclusivity, mutual respect, and fairness.
“After a comprehensive evaluation, the company has chosen to end their collaboration with Ye without delay. They will also discontinue the production of Yeezy branded items and cease all payments to Ye and his affiliated companies,” the statement stated. “Adidas will immediately halt their Adidas Yeezy business.”
At the time, the company estimated a deficit of $271.8 million for the year 2022. In May 2023, Adidas revealed its plans to sell the remaining Yeezy inventory and donate the profits to various organizations such as the Anti-Defamation League, the Philonise & Keeta Floyd Institute for Social Change, and other charities. In 2022 and 2023, Adidas recorded a net income of around $326 million from the sale of approximately $1.3 billion and $815 million worth of Yeezy stock, respectively.
On January 31st, Gulden acknowledged that our financial performance is not satisfactory, but we are actively working towards improving and reestablishing Adidas as a strong company.
As previously stated, our main focus is to take the necessary time to successfully rebuild it. I am confident that our team’s attitude and flexibility have returned, and we are once again embodying the traditional adidas DNA,” he expressed.
Source: independent.co.uk
