Adidas to continue selling shoes with Ye designs sans Yeezy branding

Following Kanye West’s anti-Semitic remarks, Adidas along with GAP and Balenciaga ended their partnerships with the rapper. However, Addidas announced on Wednesday that it will continue to sell West’s sneaker and apparel line, but without the Yezee name associated with it. 

Adidas finance chief Harm Ohlmeyer said that the company is the sole owner of all the designs under the Yezee branding and selling the sneakers without the Yezee branding will save them close to $300 million in royalty payments and marketing fees. 

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Earlier, the Associated Press reported that Adidas has forecasted lowered earnings for the rest of 2022 after accounting for losses it will suffer due to cutting off ties with West. The company cut its sales outlook for 2022 in its third quarter statement to a low single digit increase from a mid single digit increase. Its net profits are also projected to drop by 250 million euros and its net revenue by 500 million euros.

“Going forward, we will leverage the existing inventory with the exact plans being developed as we speak,” Ohlmeyer said. 

The Yeezy brand accounted for Adidas’s 15% of net income, according to David Swartz, an analyst with Morningstar. 

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Morgan Staley says that sales from Yeezy accounted for nearly $2 million in profit for Adidas in 2021, which was 8% of the company’s total sales. Above all, the Yezee line helped the brand to get a place at major retailers and brought new customers to the stores. All of that is set to change with Adidas cutting ties with the rapper. 

Kanye West made the headlines after making repeated anti-Semitic remarks in TV interviews and on social media. He was also banned from Instagram and Twitter due to the remarks.