Key Takeaways:
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- Adidas forecasts an operating profit of €1.7 billion to €1.8 billion for 2025, driven by strong demand for retro sneakers like the Samba and Campus.
- The company’s recovery under CEO Bjorn Gulden has been bolstered by a back-to-basics strategy and strong global sales growth, particularly in Europe, China, and North America.
- Adidas’ currency-neutral sales are expected to grow at a high-single-digit rate, with double-digit growth excluding the defunct Yeezy franchise.
- Shares have risen 32% in the past year, outperforming competitors Nike and Puma.
What Happened?
Adidas AG announced a profit forecast of €1.7 billion to €1.8 billion for 2025, reflecting strong momentum in global sales, particularly for its retro sneaker lines like the Samba, Campus, and SL72. While the forecast falls short of analysts’ €2.07 billion estimate, Adidas is known for conservative guidance and raised its outlook multiple times last year.
The company’s recovery has been led by CEO Bjorn Gulden, who has focused on core sportswear and retro footwear after managing the fallout from the terminated Yeezy partnership with Kanye West. Adidas saw significant sales growth in key markets, including a 16% increase in Greater China, 25% in Europe, and 15% in North America during the fourth quarter of 2024.
Why It Matters?
Adidas’ resurgence highlights the growing consumer demand for retro sneakers, which have become a key driver of revenue and brand buzz. This trend has allowed Adidas to recover from past crises and position itself as a strong competitor to Nike, which has faced its own challenges.
For investors, the company’s high-single-digit sales growth and double-digit growth excluding Yeezy signal a sustainable recovery. Adidas’ ability to outperform Nike and Puma in share price growth over the past year reflects market confidence in its strategy under Gulden’s leadership.
The company’s decision to delay the reintroduction of certain retro models, like the Superstar basketball shoes, demonstrates a disciplined approach to managing demand and avoiding market saturation.
What’s Next?
Adidas plans to continue leveraging its retro sneaker momentum while expanding its sportswear offerings, such as Predator football boots and Adizero running shoes. The company’s focus on high-growth markets like China, Europe, and North America will remain critical to sustaining its recovery.
Investors should watch for further updates on Adidas’ ability to maintain double-digit growth excluding Yeezy and its strategy to close the gap with Nike. Additionally, the company’s disciplined product launches and focus on innovation will be key to sustaining long-term profitability.
