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In a speech at Adidas’ Annual General Meeting for 2023 on Thursday, CEO Bjørn Gulden gave some insight into what the retailer plans to do with all its leftover Yeezy merchandise.
“For the last four months we have been trying to find solutions on what to do with it. Burning the goods is not the solution. Now, talking to all the NGOs, and a lot of organizations that have been hurt by Kanye, they all say, ‘No, that's not the solution,’” Gulden said, according to a translation of his comments provided by an Adidas spokesperson.
What to do with the 1.2 billion euros ($1.3 billion) of product has been a debate ever since Adidas cut ties with Kanye West, also known as Ye, in October. The retailer faced pressure both at the concept of burning the products and at the concept of selling the products. Now, it appears the retailer is leaning toward the latter option, with the aim of donating the proceeds.
“What we are trying to do now over time is to sell parts of this inventory and donate money to the organizations that are helping us and that was also hurt by Kanye's statements,” Gulden said. “When we will do that and how we will do that is not clear yet, but we are working on those things. But I think burning the products is not the point. And we will update you as soon as that decision is made."
An Adidas spokesperson did not answer questions about how much of the inventory the retailer plans to sell or if West would benefit from the sales. Adidas has said in the past that, as the sole owner of the IP rights to the designs, it would sell Yeezy products without the Yeezy name starting in 2023.
The fallout of the Yeezy partnership lost Adidas hundreds of millions of dollars in net income in 2022, and led the company to project its first annual loss in three decades for 2023. Adidas reported first quarter earnings on Friday, which showed revenue declines of 1%, but Gulden said that sales growth excluding Yeezy was 9%.
Adidas is also facing a lawsuit from investors claiming the company knew of the risks associated with its Yeezy partnership and did not disclose them.
via https://www.aiupnow.com
Cara Salpini, Khareem Sudlow
