Adidas CEO suggests Yeezy sneakers could be sold
Adidas CEO Bjørn Gulden – who has wrestled for months over what to do with the company’s accumulated Yeezy inventory – suggested on Thursday that it could be sold.
Adidas has once been popular since cutting ties with rapper Ye, formerly known as Kanye West, in October over his anti-Semitic outbursts and public meltdowns Yeezy shoes are piling up in the warehouses.
While Adidas has been reluctant to decide what to do with the millions of sneakers, Gulden made it clear at Thursday’s AGM that “burning is not the solution.” according to Bloomberg.
He added that Adidas spoke to many non-profit organizations that agreed with the decision. Gulden had previously said during a March conference call that he was “trying to avoid” burning the shoes “because it’s a sustainability issue.”
Instead, “over time, we try to sell portions of that merchandise and then donate to organizations that help us that have also been hurt by Kanye’s statements,” Gulden said, according to Bloomberg.
“It’s not yet clear when we’re going to do that and how we’re going to do that, but we’re working on those things,” the CEO said. He also did not explain to which organizations Adidas wanted to donate.
Adidas also said in March that it would not sell the unsold Yeezy inventory to avoid “a reputation issue.”
In a 2022 annual report reviewed at the AGM, Adidas said that should it “decide not to reuse any of the existing Yeezy products, it would result in the write-off of the existing Yeezy inventory and further reduce operating profit by around 500 million euros (546, $5 million) this year.”
Seven months after Adidas and Yes split, Gulden still hasn’t made a final decision on what to do with the sneakers, and unsold inventory is piling up in warehouses.
German sportswear company audits $1.3 billion in unsold Yeezy show inventory And while the brand is reluctant to resell the products, a resale could erase the brand’s $546.5 million in losses.
Gulden said the split continues to “damage” the brand The earnings report for the first quarter was released last week.
The report revealed that Adidas saw “sales down 20% in North America – down 5% excluding Yeezy,” which Adidas attributed in part to “high inventories.”
Gulden said last week that “2023 will be a bumpy year with disappointing numbers” for Adidas. He added that this will be “a transitional year to lay a strong foundation for a better 2024 and a good 2025 and beyond” rather than “maximizing our near-term financial results.”
