Sportswear giant Adidas AG (OTC: ADDYY) received more than €508 million (US$565 million) worth of orders for its 4 million pairs of unsold Yeezy shoes.
The Financial Times reported that there’s an overwhelming demand for the first tranche of online sales, which is expected to save the Bavaria, Germany-based company from a large write-off on its stock.
Adidas had stopped selling Yeezy shoes after its partnership with rapper Kanye West, who now goes by Ye, ended due to the singer’s antisemitic remarks.
Ye was the center of controversy in antisemitism where he toured his antisemitic remarks on speakerships and interviews with former Fox News host Tucker Carlson and InfoWars host Alex Jones.
The rapper had repeated his denial of the Holocaust.
His association with white supremacist, Nick Fuentes, sparked a controversy where he dined with former President Donald Trump where an altercation came about on running for President of the United States in 2024.
Losing Yeezy had cost the footwear company a whopping $440 million in the first quarter of 2023.
In May, Adidas said it would sell some of the inventory as destruction would cost it about €500 million, and donate a part of the proceeds from the Yeezy sales to organizations fighting antisemitism and racism.
Adidas’ shareholders launched a class action lawsuit against the German apparel company alleging the company knew about the rapper’s behavior, but failed to notify investors. The lawsuit also alleged that the executive intended to deceive investor or acted in disregard of the truth over the behavior of the rapper.
It was reported that West had showed nude photos of his former wife, Kim Kardashian, to employees where he created a toxic environment.
“He has, in years past, exploded at women in the room with offensive remarks, and would resort to sexually disturbing references when providing design feedback. This type of response from a brand partner is one that Adidas employees should never be subjected to, nor should Adidas leadership ever tolerate,” said an unidentified source in a letter to the Adidas leadership team.
The company had previously said it is slated for a loss in fiscal 2023 — the first operating loss in 31 years, before opting to sell the remaining Yeezy stocks.
Thomas Chauvet, Citibank’s head of luxury and sporting goods research, expects Adidas will update its revenue and profit guidance “to reflect the initial sale of Yeezy inventory.”
Adidas will likely publish second-quarter earnings for 2023 on Aug. 3.
Produced in association with Benzinga