ADIDAS ON THE RISE
Jerseys and ‘dad shoes’ contribute to $7.94 billion in second-quarter revenue
Shares spike after company posts second-quarter revenue,
FRANKFURT, GERMANY— Adidas AG got a boost from the World Cup, selling record numbers of jerseys even though the national teams it sponsors lost out to countries supported by rival Nike Inc.
The German sportswear giant’s shares rose as much as 10 per cent on Thursday, the most since March, after it posted second-quarter revenue and profit that beat analyst expectations.
Adidas World Cup shirt sales topped the 8 million sold in connection with the tournament in Brazil four years ago, chief executive officer Kasper Rorsted said in an interview with CNBC. That’s even though two teams wearing Nike uniforms — winner France and runner-up Croatia — faced off in the final at this year’s event.
The Herzogenaurach, Germany-based company withstood a shift in off-the-field fashion away from minimalist classic shoes like the Stan Smith sneaker and toward so-called “dad shoes” — chunkier versions of designs from the 1980s and 1990s. German competitor Puma SE last month said the change hurt its sales in the first half of the year.
“The consumer is becoming more fickle,” Rorsted said on CNBC. “That’s an opportunity but also a threat.”
Adidas said revenue adjusted for currency swings rose 10 per cent to 5.26 billion euros ($7.94 billion) in the second quarter, driven by a12 per cent gain at its namesake shoe brand. Analysts on average predicted 5.17 billion euros.
The company saw double-digit growth in North America, Asia-Pacific, Latin America and Russia. It also reiterated a forecast for a 10 per cent currencyadjusted sales gain this year.
Adidas said it had “exceptional growth” in football merchandise in Russia, which hosted the World Cup, and Latin America, while the category also grew at a double-digit pace in North America and Western Europe.