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Kanye West. Adidas will lose millions of euros on cooperation with the star

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Adidas has warned that the company could post an operating loss of €700 million in 2023. One of the reasons is the end of cooperation with rapper and fashion designer Kanye West.

At the end of October last year, the German giant of sportswear terminated the contract with rapper Kanye West. It was related to the controversial behavior of the musician. It’s about his posts on social media that were deemed anti-Semitic. Cooperation with West brought Adidas huge profits – it accounted for about 10 percent of the company’s revenues.

An expensive breakup

Now the new head of the company, Bjørn Gulden, has admitted that parting with the controversial star could cost the company 500 million euros. That’s how much the clothing and footwear designed by the rapper are worth, which the company still stores in its warehouses.

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The concern also expects that the transformation in the company will cost another 200 million euros. This means that Adidas could record a total loss of €700 million this year.

– The numbers speak for themselves. At the moment we are not getting the results we should,’ said Bjørn Gulden. The head of Adidas does not give hope for a quick improvement in the company’s financial situation. This is to come only in 2024.

As the BBC notes, breaking the contract with West is not the only challenge the company faced last year. In March, the company joined other Western companies and decided to withdraw from the Russian market. Adidas also faced serious problems on the Chinese market, where the restrictive lockdown resulted in a significant reduction in demand and the need to close factories.

Dispute with Kanye West

Hot on the Adidas Line – Kanye West has been for many months. At the beginning, Kanye West accused the company of illegally using his clothing and footwear designs. The company’s objections to cooperation with the celebrity appeared after he showed a T-shirt design with the inscription “White Lives Matter”. This is a reference to the slogan of protesters against police violence and brutality against black people in the United States. West’s controversial activities were met with a wave of criticism, and the rapper was accused of trivializing the importance of this issue.

Just a few days later, the artist’s comments appeared on social media, which were widely considered anti-Semitic. In the entry quoted by the media, but already deleted, there was supposed to be a suggestion of a threat and a reference to Jews. “You played with me and tried to exclude anyone who opposes your agenda,” the rapper’s tweet was quoted by the media.

Adidas’ decision was not the only reaction to West’s actions. Cooperation with the rapper was also suspended by the JP Morgan bank and the Gap clothing store chain. The rapper also had his social media accounts suspended, including Twitter and Instagram.

Main photo source: Shutterstock

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