German footwear company Adidas is facing a huge loss as its shares tanked a whopping 11% today. It all happened after their report that they are sitting on a $1.2 billion pile of unsold merchandise after terminating its lucrative branding deal with rapper Ye, formerly known as Kanye West.
According to Company’s reports, If it has to write off all existing Yeezy inventory, it faces an operating loss of as much as $500 million in 2023. “The numbers speak for themselves. We are currently not performing the way we should.”Adidas’ new chief executive Bjorn Gulden said on the company’s website.
The Yeezy deal might have brought in $1.2 billion of revenue and $500 million of operating profit had things turned out differently, the company said.
Adidas ended their deal with Ye a few months back following his series of anti-Semitic remarks on social media.“Adidas does not tolerate antisemitism and any other sort of hate speech. Ye’s recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness,” said the company on ending the nearly 10-year partnership.
(Report via Bloomberg)