Adidas has announced a significant increase in its profit forecast, attributing it to robust sales performance.
- The company’s operating profit target now nears £1bn for 2024, significantly higher than previous estimates.
- Adidas experienced a surge in third-quarter profits, surpassing last year’s figures by a considerable margin.
- Growth was notably strong in lifestyle and performance sectors, with footwear sales witnessing a remarkable rise.
- Regional sales, particularly in Greater China and North America, contributed to the positive financial outlook.
Adidas has revised its full-year profit ambitions upwards, following an unexpected surge in sales over recent months. The sportswear company has raised its operating profit forecast for 2024 to approximately £997m, showing adaptability and strength in its financial planning. This upward revision is buoyed by a reported operating profit of €598m in the third quarter, a substantial increase from €409m in the same period of the previous year.
The company has also seen a noticeable rise in net income from ongoing operations, which reached €449m. This performance was driven by double-digit growth across both its lifestyle and performance sectors. As part of its trading update, Chief Executive Bjrn Gulden expressed satisfaction with the company’s achievements, noting a 14 per cent growth within the Adidas brand. His comments, “The third quarter was a very strong quarter for us and again better than expected,” underline the success.
Adidas’s market strategy appears successful across all regions and channels, with a balanced growth trajectory reported in lifestyle and performance segments. Footwear, a key revenue driver for the brand, recorded a 14 per cent increase. This was supported by a spike in demand for its original and performance lines, covering categories such as running and football. Additionally, the apparel sector, including accessories, performed well, boosted by collaborations with designers like Wales Bonner.
Fiscally, Adidas reported a 13 per cent uplift in wholesale revenue and achieved a 7 per cent growth in its direct-to-consumer segment. E-commerce also stood out, with a notable 25 per cent increase, excluding sales from the Yeezy collection. Regionally, the firm saw impressive results in Europe, achieving 18 per cent growth.
Significantly, Adidas’s operations in Greater China and North America have turned towards positive figures earlier than anticipated. CEO Gulden attributed this to the enduring strength of the Adidas brand and recognised the hard work of employees across markets and functions. Gulden further emphasised that the brand’s renewed popularity offers a unique opportunity to connect with a new generation of consumers across all markets.
Adidas’s revised profit forecast and robust sales growth highlight its successful strategic direction.
