Sportswear giant Adidas is still generating significant revenues from its terminated deal with Kanye West, taking in around $158.5 million from recent Yeezy sneaker releases.
Adidas shared its latest earnings preview on Tuesday, revealing sales of West's popular shoes have helped reduce the company's expected operating losses for 2023. This comes after Adidas rushed Yeezys to market earlier this year following their split with West.
The German brand initially cancelled its lucrative partnership with West in October 2022 due to his antisemitic comments. However, the continued sale of existing Yeezy inventory has proven financially beneficial for Adidas.
West still earns royalties on all sales. Meanwhile, Adidas donates a share of proceeds to Jewish groups, as promised after dropping West.
The full impact of severing ties with West won't be clear until Adidas releases its complete Q3 earnings next month. But for now, the lingering fruits of their deal are buoying the company's bottom line.
Adidas CEO Bjørn Gulden recently praised West's creativity but later apologized for suggesting the rapper didn't mean his past antisemitic remarks. Gulden called parting with West "very sad" but said such risks come with celebrity partnerships.
The saga illustrates the complexities of aligning with controversial public figures. Though rewarding at first, associations can turn costly when values clash. For Adidas, disavowing West was an ethical imperative - even if abandoning his popular brand has proved financially challenging.