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Adidas Exceeds Q4 Expectations Amid Yeezy Stock Sell-off

Prime Highlights: 

Adidas reported a 19% increase in revenue, reaching 5.97 billion euros ($6.34 billion), surpassing analyst expectations of 5.72 billion euros.  

Operating profit for Q4 was 57 million euros, a stark improvement from a 377-million-euro loss in the same period last year. 

Key Background: 

Adidas reported stronger-than-expected fourth-quarter sales, driven by the final liquidation of its Yeezy stock, although it anticipates slower revenue growth in the upcoming year. The German sportswear giant recorded a 19% increase in revenue at neutral currency rates, reaching 5.97 billion euros ($6.34 billion), surpassing the 5.72 billion euros forecasted by analysts. Operating profit for the quarter stood at 57 million euros, a significant recovery from the 377-million-euro loss recorded in the same period the previous year. 

For the full year, Adidas posted a 12% increase in sales at currency-neutral rates, totaling 23.7 billion euros, exceeding the anticipated 23.5 billion euros. Operating profit for 2024 reached 1.34 billion euros, slightly surpassing the 1.27 billion euros forecast. CEO Bjorn Gulden expressed optimism over the company’s performance, calling the results “much better than expected” and acknowledging the strength of the Adidas brand. 

However, Adidas cautioned that growth in 2025 may slow down, forecasting a high-single-digit increase in currency-neutral sales and operating profit between 1.7 billion euros and 1.8 billion euros. Despite challenges, including the discontinuation of the Yeezy line and softening North American sales, Gulden remains confident in the company’s ability to capitalize on trends and adapt to market conditions. 

Adidas is working to recover market share in North America, where sales fell 1.6% in 2024, partially due to the Yeezy line’s termination following the dissolution of its partnership with Kanye West. Additionally, analysts highlight the need for further innovation, particularly beyond the popular Samba and Gazelle lines, to maintain growth in an increasingly competitive market.