Adidas outperformed market forecasts
Adidas (ETR:ADS) shares added around 3% on Wednesday, thanks to upbeat financial results and an upgraded outlook for the rest of 2024.
It comes in stark contrast to American rival Nike, which recently issued a profit warning.
Today, the German sportswear firm told investors it now expected operating profit to reach €1 billion this year, after seeing a strong performance in its second quarter. That marked a significant upgrade from a prior forecast of €700 million.
It reported that second-quarter revenues increased around 11% on a constant currency basis – whilst in Euros, it was up 9% to € 5.822bn. Operating profit for the year was up at €346 million, from €176 million a year ago.
Adidas noted the wind-down of its ‘Yeezy’ collaboration, with €50 million worth of inventory sold in the period, and, said it assumes it will sell the last of the Yeezy stock during the remainder of the year “to occur on average at cost” – to generate around €150 million of remaining sales.
The German firm’s comparatively strong performance as a number of its iconic trainer designs are seeing a premium-priced resurgence – with brands such as the Gazelle, Samba and Spezial in fashion, especially among ‘gen z’ influencers and celebrities.
Adidas shares were up 2.8% on Wednesday, trading at €235.10.
