Bloomberg reports Yeezy accounts for 40% of Adidas profits.
Kanye and Adidas has had a tumultuous relationship from the early days as the rapper turned designer would publicly air out his business partner for unfair dealings.
Bloomberg reports that “From the beginning, there were plenty of warning signs that Adidas AG’s collaboration”.
Severing ties with Ye is proving to be more detrimental to the sports brand than initially reported.
Yeezy was a huge win for Adidas who Ye chastised for rolling off his designs and putting them on other shoes without the Yeezy approval. The styles copied from the rapper and social media star helped the company to become a leader in footwear and gear for sports such as soccer—to attract a young, hip international clientele that relate to Ye and the culture of Hip Hop and taste making he represents.
Morgan Stanley analyst Edouard Aubin estimates that the Yeezy line has been generating €1.8 billion ($1.8 billion) in annual sales, about 8% of Adidas’s total revenue and more than 40% of the company’s profits.
On Oct. 25 Adidas released a statement denouncing Ye’s comments as “unacceptable, hateful and dangerous,” adding that they violated the company’s values of “diversity and inclusion, mutual respect and fairness.” Beyond that, Adidas has stayed silent, saying it will fill in more details of the Yeezy breakup and future of the partnership’s shoe designs when it delivers quarterly earnings on next Wednesday (Nov. 9).
