Sportswear manufacturer Adidas has said that it is set for an operating loss of $725 million (Rs 5,987 crore) in 2023 from the fallout of its dispute with rapper Kanye West, who has formally changed his name to Ye, according to a report in Time Magazine. Adidas had cut its ties with Ye last October over the rapper's anti-semitic remarks. Adidas had designed the highly-successful "Yeezy" line together with West, but stopped all the payments to Ye. Now, the company's new boss has said it could lose millions of dollars if it decides not to sell its stock of Yeezy sneakers, Time further said.
"The numbers speak for themselves," Adidas' Chief Executive Officer Bjorn Gulden said on the company's website. "We are currently not performing the way we should."
Mr Gulden joined Adidas in January after spending a decade at rival Puma, where he led turnaround. His focus at Adidas now is to reinvigorate the brand's lackluster business.
"We need to put the pieces back together again but I am convinced that over time we will make Adidas shine again," said Mr Gulden. "But we need some time."
Adidas, meanwhile, said it is expected to return to profit in 2024. It also revealed that the operating profit for last year had fallen to 669 million euros (Rs 5,911 crore), two-thirds lower than 2021.
The sportswear brand ended its ties with Ye after he was suspended from Instagram and Twitter over offensive posts.
In March last year, the company said it would close its stores and suspend online operations in Russia, The Guardian reported. Adidas has also been hit by China's strict Covid restrictions put in place to curb a new wave of the virus late last year.
