German sports brand Adidas has lowered its profit forecast for the third time since last summer. The new downward revision results from the termination of the collaboration with rapper Kanye “Ye” West.
The reason for the termination of the collaboration was the anti-Semitic statements of the American, who had been working with Adidas with his brand Yeezy since 2015.
The German sports brand now expects revenues at constant exchange rates to increase by a few percent this year. Previously, a growth of around 5 percent was expected. As a result, the forecast for the operating margin has also been lowered from 4 percent to 2.5 percent. The Yeezy line accounted for nearly half of Adidas’ total profits.
Kanye West, who previously had his name changed to Ye, has recently come under fire from several sides. The artist made anti-Semitic statements in various interviews and tweets. As a result of his statements, the rapper was denied access to his social media accounts. Previously, the fashion house Balenciaga and the American agency Creative Artists Agency stopped all their collaboration with the artist.
Adidas has had a series of setbacks lately. In addition to the dispute with Ye, the brand is struggling with weak sales in China. Earlier this week, the company confirmed that CEO Bjørn Gulden of the German sports brand Puma would take over the leadership of Adidas from 1 January. The Norwegian will take over from CEO Kasper Rørsted, who will step down from Adidas on Friday. In the meantime, he will be replaced by financial director Harm Ohlmeyer.
