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Germany’s Adidas forecast a lower than expected operating profit for 2025, anticipating sales growth will slow slightly from a strong 2024, and flagged increased volatility due in part to US tariffs.
CEO Bjorn Gulden called the guidance conservative and said the company’s ambition was higher, however, helping shares recover to trade up around 1 percent after early losses. Adidas, which has been gaining market share while main rival Nike struggles, has repeatedly delivered stronger results than it has forecast.
Adidas said it should reach between 1.7 billion euros and 1.8 billion euros ($1.8 billion and $1.9 billion) operating profit in 2025, lower than the 2.1 billion euros analysts had expected.
Gulden, who has led a successful turnaround at Adidas since the end of its Yeezy collaboration with rapper Ye, noted risks to consumer demand.
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Further US tariffs on imports would boost inflation and cause consumers to curb spending, he said, after U.S. President Donald Trump hiked tariffs on China and implemented 25 percent tariffs on Canada and Mexico.
Trump has also threatened tariffs on Vietnam, which is the main manufacturer of Adidas products globally.
“Going into 2025, with all the volatility, we don’t know what’s going to happen with tariffs in the US, we have no idea what that inflation could cause [so] it is of course good to be on the safe side,” Gulden said.
Adidas expects annual revenues to increase at a “high single-digit” rate in currency-neutral terms, lower than the 12 percent growth it delivered last year, but sees growth of more than 10 percent when adjusting for the lack of Yeezy, after it sold its last remaining discontinued sneakers in the fourth quarter.
Adidas has a “clear ambition” of being the top sportswear brand in all markets except the United States - where Nike is especially dominant - Gulden said in an annual report also published on Wednesday.
Adidas is looking for new sources of growth beyond its retro sneakers Samba and Gazelle, as it seeks to take further market share from US rival Nike while also fending off newer sportswear brands, such as On Running and Hoka.
“The initial boom of the adidas Samba and Gazelle has set the pace, and while these iconic styles maintain a presence in the mass market, they appear to be reaching saturation,” said Lucila Saldana, footwear and accessories strategist at trend forecasting firm WGSN.
Gulden highlighted new products like ‘low profile’ thin-soled sneakers inspired by motor sports, and running shoes marketed for everyday wear, as trends to drive the business.
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In the key holiday shopping quarter, Adidas sales grew by 15 percent in North America, 25 percent in Europe, 31 percent in Latin America, and 16 percent in Greater China. Adidas expects sales in North America and Greater China, among others, to grow by more than 10 percent this year, while it sees high single digit sales growth in Europe.
Footwear like the Samba and Gazelle, as well as soccer cleats and running shoes, have been driving sales, but Adidas will also push its clothing lines more this year, Gulden said.
Footwear sales grew by 26 percent in the fourth quarter while apparel sales were up 11 percent.
Adidas plans to cut up to 500 jobs at its headquarters in Herzogenaurach, Germany, as part of a push to simplify the organisation and give teams in different markets more power to design and market local products, Gulden said in a press conference, confirming January reports.
By Helen Reid and Alexander Huebner, writing by Linda Pasquini; Editing by Miranda Murray, Tom Hogue, Tomasz Janowski and Elaine Hardcastle
Learn more:
Case Study | The Strategy That Brought Adidas Back From the Brink
Adidas has mounted one of the more remarkable turnarounds in recent memory after facing a crisis two years ago from the end of its Yeezy business. BoF spoke to chief executive Bjørn Gulden and other members of Adidas’ leadership to unpack how a series of bold decisions on products like its Samba sneaker, a move to refocus the brand on athletes and internal shifts brought Adidas back from the brink.
