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Adidas reported that its second-quarter revenues in North America, excluding Yeezy sales, climbed over the prior year.
Adidas announced on Wednesday that its second-quarter revenues in North America, excluding sales of the Yeezy line, increased compared to the previous year. This growth was driven by strong performance in wholesale and its retail channels.
Including the Yeezy product line, Adidas’ currency-neutral sales in North America, its second-largest market after Europe, fell by 8% to 1.3 billion euros ($1.51 billion) during the April to June quarter. The company attributed the decline solely to the significantly smaller Yeezy business following its break-up with rapper Kanye West, who goes by Ye. Adidas did not specify the exact increase in sales, excluding the Yeezy line.
As part of a turnaround strategy led by CEO Bjorn Gulden, Adidas has been focusing on clearing remaining Yeezy stock while boosting its brand with popular retro styles. By June 30, Adidas had reduced its overall inventories by 18%, bringing them down to 4.5 billion euros compared to the previous year.
The company reported a 6% increase in quarterly apparel sales, with strong double-digit growth in soccer-related products, including jerseys for the Euro Cup and Copa America tournaments.
In Europe, Adidas saw a 19% increase in currency-neutral sales from the previous year, reaching 1.9 billion euros in the second quarter. CEO Bjorn Gulden noted that the quarter also marked a positive development for the company’s apparel segment.
In mid-July, Adidas raised its full-year guidance and reported preliminary second-quarter results that exceeded expectations. The company credited the popularity of its low-rise multi-colored Samba and Gazelle sneakers, along with weaker sales at rival Nike, for this positive performance. Despite expecting currency effects to impact profitability significantly this year, Adidas remains optimistic about achieving its mid-term target of a 10% operating profit margin.
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