Adidas says dropping Kanye West could cost it more than $1 billion in sales

The company warned Thursday that it’s expected to lose $1.3 billion (1.2 billion euro) in revenue this year because it’s unable to sell the designer’s Yeezy clothing and shoes. Adidas ended its nine-year partnership with the rapper last October because of his antisemitic remarks.

In a statement, Adidas said if the company “can’t repurpose any of the remaining Ye clothing,” it could cost the company $534 million in operating profit this year.

The company said shortly after the partnership was dissolved that it would try to sell the clothing, stripped of the Yeezy name and branding.

Adidas said selling the sneakers under its own branding would save the company about $300 million in royalty payments and marketing fees.

Yeezy isn’t the only partnership struggling with Adidas. The news reported earlier this week that Beyoncé’s Ivy Park clothing line is in trouble as well.

Allegedly, Ivy Park only brought $40 million in sales in 2022, compared to the $93 million the brand earned in 2021. Although there was some money lost, Adidas claims their partnership with Queen Bey is “strong and successful,”

“can’t repurpose any of the remaining Ye clothing,it could cost the company $534 million in operating profit this year. The numbers speak for themselves. We are currently not performing the way we should. 2023 will be a year of transition to set the base to again be a growing and profitable company.”

Adidas CEO Bjørn Gulden said

The Chicago-born rapper can’t seem to stay out of the negative spotlight lately. After a string of odd behavior, Ye is under investigation after getting into an altercation with a woman after she was seen recording him.

He allegedly got into a screaming match with the woman on his way to his children’s basketball game and threw her phone in the street.

Adidas said last year that it ended its partnership with Ye because it “does not tolerate antisemitism and any other sort of hate speech” and said his comments were “unacceptable, hateful and dangerous.”

Adidas said they violated the company’s “values of diversity and inclusion, mutual respect and fairness.”