Following their split with controversial American rapper Kanye West, German sportswear manufacturer Adidas has disclosed that the company expects to suffer a US$1.3 billion loss without West’s Yeezy brand.
West and the company endured a tumultuous relationship prior to the termination of their contract, with West accusing Adidas of blatantly copying his Yeezy design for their Adilette 22 Slides. After a series of highly controversial and divisive interviews, which were accompanied by a string of antisemitic statements online, Adidas and West parted ways in 2022.
After Adidas split from the artiste, they said they had sole ownership of Yeezy’s core designs and expressed that they intended to sell the merchandise without the Yeezy name. However, the company appears to be having some difficulty with that plan and, in a statement on Thursday, revealed that they expect to lose $1.3 billion in revenue this year as they are unable to sell Yeezy clothing and shoes.
According to reports, Adidas will face significant adverse impacts from not selling the existing stock. If they are not able to “repurpose” existing Yeezy branded goods, the company will lose $534 million in operating profit this year.
Adidas CEO, Bjørn Gulden, said that the company was not performing as it should and that the numbers were a clear indication of that, while reports from the Wall Street Journal suggested that Adidas had problems elsewhere. The outlet reported on Wednesday that Beyoncé’s clothing line with the company, Ivy Park, had fallen short of a projected $250 million in sales in 2022, instead making roughly $40 million in sales, a 50% drop from 2021.