Adidas soared to all-time record profits and revenue in its third quarter, with the German sportswear maker raising its full-year outlook following a surge in sales and boost from its U.S. tariff refund.
The company reported in its earnings report on Tuesday that sales in the period rose 9 percent over the same point last year at $8.15 billion in revenue and $1.13 billion in profit — both records for the brand as operating profit climbed 37 percent.
Meanwhile, the brand revised its yearly guidance, increasing to between 9 and 10 percent, while CEO Bjørn Gulden noted that soccer, running and training helped fuel an impressive surge in the quarter.
“Our fantastic designers and development teams have created new apparel collections that are globally in high demand and currently fueling our lifestyle business,” Gulden said. “Yes, the footwear lifestyle business is currently challenging, mainly due to too much inventory and too much discounting in the marketplace, but we know this will soon normalize again. In this environment we are not trying to maximize the short-term. Instead we remain disciplined, continue to strengthen our foundation for sustainable and profitable growth and stay focused on our mid-term targets.”
Adidas received the bulk of its tariff refund claim and counted the nearly $225 million credit as part of its gross margin gain and around $112 million will be reinvested back into the company in the fourth quarter.
Operating profit will be raised to just under $3 billion for the year.
“We need to be close to the consumer and their local culture and we are convinced the only way you can achieve this is by empowering our teams in the markets,” Gulden said. “That is why people are so important and why our people are our main asset. I cannot thank them enough for what they are doing. Regardless of where we go in the world, we see talented Adidas people who show an enormous energy, a huge focus on serving our consumer and athletes, a passion for our brand and the company, and a fantastic spirit. In a volatile and complicated world, it is a privilege to work with such a great team.”
A final set of financial results for the third quarter will be published on October 29.
