MarketWatch reported that, on March 8th, Adidas revealed plans to reduce its 2022 dividend to €0.70 (74 U.S. cents) a share, as a result of the company’s choice to end its partnership with Kanye West. In comparison, the German sportswear company’s full-year dividend was €3.30 a year prior.
Adidas has reported a fourth-quarter operating loss of €724 million for the period ending December, compared to a profit of €66 million in the same period the previous year. The loss was even greater than some analysts had anticipated, as the consensus estimate by Bloomberg was a loss of €717 million.
The sportswear giant cited the termination of its partnership with Kanye West as a key factor in the 1% decline in quarterly revenues, resulting in a negative impact of €600 million. The discontinuation of the Yeezy brand had a particularly strong effect on demand in North America, according to Adidas.
Additionally, the company has yet to decide what to do with its remaining Yeezy merchandise, and has warned that if it goes unsold, Adidas may incur a loss of around $1.3 billion, as previously stated last month.
“2023 will be a transition year to build the base for 2024 and 2025,” said chief executive officer Bjørn Gulden in a statement. “We need to reduce inventories and lower discounts. We can then start to build a profitable business again in 2024.”
Meanwhile, Kanye West marked his return to Instagram this week following a ban for antisemitic comments. He shared a post of an image from a Balenciaga fashion show asking his followers to “Write a caption.”
