Adidas announced on Wednesday that it has committed over $150 million to combat antisemitism and other forms of hate through donations from the sales of Yeezy shoes last year, following the termination of its partnership with Ye, formerly known as Kanye West.
After ending its collaboration with Ye in October 2022 due to his antisemitic and offensive remarks on social media and in interviews, the German sportswear brand found itself with a surplus of 1.2 billion euros ($1.3 billion) worth of Yeezy sneakers stored in warehouses.
To address this surplus, Adidas opted to release the remaining shoes in batches, with two releases in 2023 and another in late February 2024, earmarking a portion of the proceeds for anti-hate organizations.
Among the recipients of Adidas’ donations are the Anti-Defamation League and the Philonise & Keeta Floyd Institute for Social Change, led by social justice advocate Philonise Floyd, brother of George Floyd.
Just this week Kanye went on a F*ck Adidas rant as he celebrates his fifth Billboard Hot 100 No. 1 with “Carnival” thanking collaborators Rich the Kid, Ty Dolla $ign, and Playboi Carti. “Rich Ty Carti and the supporters that stood by us through everything This number #1 is for you it’s for the people who won’t be manipulated by the system and fuck adidas and everybody who works there or with them Anyone who goes to school with anyone who’s parents work at adidas Just know they tried to destroy me and here we are with the number 1 song in the world Like the fake dude I saw in the lobby at the Ritz that works at Goat.”
The Yeezy designer then blast off some “f**k yous” to all of his enemies including Adidas, Drake in a lengthy Instagram post saying, “You pussys don’t stand for shit And f**k everybody at the Dailey Mail And F**k everybody at the fashion houses that sided with Gabby and Hailey Bieber F**k each and every single one of yall And f**k every Christian that watched me have my kids taken out of my control That’s how I feel And it’s f**k Drake for taking Durk right at the beginning of the Vultures role out I’ll come back to yall if I think of more f**k you’s.”
Last year, net sales from the remaining Yeezy inventory at Adidas amounted to approximately 750 million euros, down from over 1.2 billion euros in 2022, resulting in a profit of 300 million euros. Adidas disclosed that over 140 million euros ($152 million) of this profit has been or will be donated.
Adidas attributed its ability to achieve an operating profit of 268 million euros in 2023, despite a nearly 60% decrease from the previous year, to the decision to sell a significant portion of its Yeezy inventory and operational improvements.
According to Morgan Stanley analyst Edouard Aubin, the Yeezy collaboration between Kanye West and Adidas, contributed to 40% of Adidas’ profits. Despite a rocky relationship between Kanye and Adidas, the Yeezy line was a significant success, helping Adidas become a leader in footwear and sports gear. The partnership’s termination turned out to be more damaging to Adidas than initially anticipated. The Yeezy line generated approximately €1.8 billion ($1.8 billion) in annual sales, comprising 8% of Adidas’ total revenue and over 40% of its profits.
CEO Bjørn Gulden acknowledged the challenges faced in 2023 but expressed optimism about the company’s performance, anticipating sales of approximately 250 million euros from the remaining Yeezy inventory this year.
However, Adidas highlighted North America as a persistently challenging market, with revenue expected to decline in the mid-single digits due to the “negative Yeezy impact,” leading to a 16% drop in revenue in the region last year.
Despite macroeconomic uncertainties and geopolitical tensions, Adidas aims to nearly double its operating profit to around 500 million euros this year. The company plans to capitalize on high-demand shoe lines like Samba, introduce new products, and leverage major sports events such as the Paris Olympics to drive growth.
