Strong performance and inventory decision drive positive results
- Adidas exceeded revenue and operating profit guidance in 2023
- Sales on a currency neutral basis were flat compared to 2022
- Annual sales slipped 5% to 21.43 billion euros
- Operating profit came in at roughly EUR200 million, above guidance
- Adidas decided not to write off EUR268 million of Yeezy inventory
- CEO expects a ‘flattish’ start to sales in 2024
Adidas has announced that it exceeded its revenue and operating profit guidance for 2023. Despite flat sales on a currency neutral basis compared to the previous year, the company’s performance was better than expected. Annual sales slipped 5% to 21.43 billion euros, but operating profit came in at roughly EUR200 million, surpassing the guidance of around EUR100 million. One of the key factors contributing to this positive outcome was Adidas’s decision not to write off EUR268 million of Yeezy inventory. CEO Bjorn Gulden expressed confidence in the remaining inventory, stating that it can be sold in 2024 for at least the cost price. Looking ahead, Gulden expects a ‘flattish’ start to sales in 2024, but anticipates revenue improvement in each subsequent quarter. The company aims for mid-single-digit currency-neutral sales growth and an operating profit of around EUR500 million in 2024, with the goal of returning to double-digit growth and a 10% operating margin.
Public Companies: Adidas (N/A)
Private Companies:
Key People: Mauro Orru (N/A), Bjorn Gulden (Chief Executive)
Factuality Level: 8
Justification: The article provides specific information about Adidas’ revenue and operating profit, as well as the company’s performance in the fourth quarter. It includes quotes from the Chief Executive and mentions the decision not to write off Yeezy inventory. The information provided seems to be based on official statements and financial data.
Noise Level: 7
Justification: The article provides information on Adidas’ revenue and operating profit exceeding company guidance, as well as the reasons behind the improvement. It includes details on sales performance, currency effects, and the decision not to write off Yeezy inventory. The article also mentions the CEO’s expectations for the future and the company’s targets. However, it lacks in-depth analysis, scientific rigor, and evidence to support the claims made. It also does not provide actionable insights or explore the consequences of decisions on stakeholders.
Financial Relevance: Yes
Financial Markets Impacted: Adidas
Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article pertains to the financial performance of Adidas, a sporting-goods company. It discusses the company’s revenue, operating profit, and sales performance in 2023, as well as its outlook for 2024. There is no mention of any extreme events or their impact.
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