The German sportswear brand Adidas is benefiting from the fact that sport is once again the centre of attention this summer. This traditionally drives the sale of sporting goods.
After a long period when people were sometimes barely able to exercise due to the corona pandemic, there are again major tournaments such as the European Football Championship and the Olympic Games. Adidas sales in Europe and North America have almost doubled as a result.
In the comparable period last year, the sports brand was still hard hit by the first corona lockdowns, while the stores in many countries were able to open again last quarter. Adidas’ total revenues increased by almost 52 percent to more than 5 billion euros. There was a profit in the books of 407 million euros. A year ago, there was still a loss of 317 million euros.
Products such as football shirts and outdoor clothing were particularly successful. CEO Kasper Rørsted calls the results better than expected, and he is happy that the focus on sport is back. However, it was noticeable that online sales fell considerably, now that people could physically go to sports stores again. Adidas is taking advantage of the strong quarter to raise its full-year forecasts. The company expects to grow by up to 20 percent. Net profit from continuing operations should also amount to around 1.4 billion euros to 1.5 billion euros.
According to Rørsted, the optimistic forecast does not alter the fact that the clothing industry also faces challenges. For example, more prominent shoe and clothing brands such as Adidas and also the American Nike have recently faced production problems due to the closure of factories in Southeast Asia because the authorities there want to prevent the further spread of the coronavirus.
The international relations with China are also not going well for Adidas. Earlier this year, there were major protests in China against Western clothing brands. In addition, Adidas has also been the target of boycotts by the Chinese as the company stated human rights violations in the Xinjiang region.
According to Adidas, sales in the Greater China region fell last quarter. But the group attributes this mainly to the fact that the second quarter of last year was exceptionally strong there. While the rest of the world was locked down because of the corona at the time, China – where the corona pandemic had started – opened again during that period. At the time, this caused a significant uptick in sales in the Asian country.