The shoes go on sale at an Adidas store in Chicago on February 10, 2023.
Scott Olson | fake images
adidas announced Wednesday that it will not write off most of its unsold Yeezy inventory and instead plans to sell the remaining shoes “at least” at the cost it paid for them, as the clothing retailer looks to recoup its losses.
The German sportswear giant had previously considered writing off about 300 million euros, or $325 million, in unsold Yeezy inventory after the company cut ties with rapper Ye, formerly known as Kanye West, for a series of anti-Semitic comments he made.
In its announcement, Adidas said it managed to generate an operating profit of 268 million euros in 2023, after originally forecasting a loss of 100 million euros. The company attributed the gains to its “better-than-expected operating business” during its fourth quarter and a decision to sell off most of its remaining Yeezy inventory.
“Following the latest decision, 2023 operating profit now only includes a low double-digit amount in millions of Yeezy-related inventory write-offs. Instead, the company plans to sell the remaining Yeezy product at least at cost in 2024,” he said. Adidas. in a press release.
CEO Bjørn Gulden added: “Our consumer, retail and trade research has shown that we can sell this remaining inventory in 2024 at least at cost price. That is why we have only written off inventory that was damaged or severely broken in size.”
Last year, Adidas sold about €750 million worth of Yeezy products and donated part of the profits to groups such as the Anti-Defamation League and the Philonise & Keeta Floyd Institute for Social Change, a group run by George Floyd's brother.
It's unclear if Adidas will donate any portion of the remaining Yeezy sales. The company said it “does not assume any contribution to Yeezy earnings” in fiscal 2024.
The company declined to say whether it would donate more profits this year.
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