|
Neubauer Artists LLC Getting your Trinity Audio player ready... |
International manufacturer of sportswear, footwear, accessories and sports goods with headquarters in Herzogenaurach (Germany).
In 1948, the Dasslers decided to split their business, each receiving a factory in Herzogenaurach. Rudolf launched the Puma brand, and Adolf registered the Adi Dassler adidas Sportschuhfabrik brand in 1949, which was eventually shortened to adidas.
Previously released Dassler shoe designs included two, three and four stripes. In 1949, Adolf Dassler registered a shoe model with three stripes, which later became iconic for the brand. In 1951, adidas acquired the three stripes trademark from the Finnish brand Karhu, and in 1971, the trefoil was added to them.
Adidas grew rapidly during the 1950s , when German footballers switched to its boots, which were lightweight and had screw-in studs. The company then developed a line of sporting goods, introducing its first footballs in 1963, followed by a clothing line four years later. For many years, adidas remained the largest manufacturer of sports shoes, but competition increased in the 1970s , especially from new players such as Nike. In the 1980s , after the death of Adi Dassler, the company’s market share declined. Dassler’s heirs left the company in 1990. From 1990 to 1993, adidas was owned by French manager Bernard Tapie, who was unable to revive the business. The company was sold to French investors and Robert Louis-Dreyfus became CEO and chairman of the board , under whom the company began to be reorganized. In 1995, it went public and was able to get rid of its debts.
Under Louis-Dreyfus, adidas acquired the Salomon Group, known for its winter sports products and also for its golf supplier TaylorMade, in 1997. In 2001, adidas Holding was renamed Adidas-Salomon AG and moved into retail, following in the footsteps of Nike. In 2004, the company entered into a successful partnership with fashion designer Stella McCartney.
In 2005, adidas sold Salomon but retained the TaylorMade brand. The following year, the name was changed back to Adidas AG. Later acquisitions by adidas included Reebok (including the Rockport and Reebok-CCM Hockey brands) in 2006 and the outdoor specialist Five Ten in 2011.
In March 2015, the company’s five-year strategic business plan, “Creating the New,” was presented. That same year, the Rockport brand was sold, and two years later, after the arrival of new CEO Kasper Rørsted at adidas, the holding parted ways with the hockey brand CCM and golf brands TaylorMade, Adams Golf and Ashworth. The main efforts were focused on the development of adidas and Reebok. In August 2021, adidas announced the sale of Reebok to Authentic Brands Group. The deal, which amounted to approximately $ 2.5 billion, was completed in March 2022.
In August 2022, Kasper Rorsted left adidas, under whom the brand had made significant progress in modernizing and optimizing its business model . The change in leadership was explained by the need for a restart after three years of struggling with the economic consequences of the pandemic and geopolitical tensions. Rorsted’s place was taken by former Puma CEO Bjørn Gulden.
In the fall of 2022, adidas was forced to terminate its contract with designer Kanye West, including stopping production of Yeezy-branded products. The reason was the musician’s anti-Semitic statements. The operating loss from the termination of the cooperation was estimated at 700 million euros.
In the 2023 financial year, Adidas’s currency-neutral revenue was unchanged from the previous year, while in euro terms, turnover decreased by 5% to €21.4 billion. The annual loss from continuing operations was €58 million, compared to a net profit of €254 million in 2022.
At the end of April 2024, the company reported that it had returned to growth after a decline in sales in 2023. Group sales rose by almost 4% to almost €5.5 billion, with currency effects having a negative impact. Adjusted for these, growth was 8%. Profit rose to €170 million after a loss of €39 million.
In the financial report for the second quarter of 2024, Adidas noted an increase in revenue to 5.82 billion euros (+11% for the same period in 2023).
Adidas’ sneaker sales grew by 17% worldwide, offsetting the loss of revenue from Yeezy products. After breaking the contract with Kanye West, with whom the brand developed the line, the company sold the remaining models at cost. The closure of Yeezy affected Adidas’s revenue, but in 2024, the remaining models of the line brought the brand 350 million euros, and for the second half of the year, the company predicted sales of another 150 million euros.
About The Author
