Companies

Better-than-expected first quarter prompts adidas to raise guidance

Apr 22, 2024 Germany

The German-based sportswear company has announced better-than-expected figures in its preliminary results for the first quarter of 2024, raising its full-year guidance in result

In the first quarter of the current financial year, adidas recorded currency-neutral sales growth of 8%, on a comparable basis to the same period of last year. In euro terms, revenue increased by 4% against the prior year period, reaching 5.45 billion euros. The company’s gross margin improved by 6.4 percentage points to 51.3% in the first three months and operating income totalled 336 million euros, as compared to 60 million euros in the first quarter of 2023.

“As a result of the better-than-expected performance during the quarter”, adidas has raised its full year guidance. The sportswear company now expects the currency-neutral revenue to increase at a mid- to high-single-digit rate in 2024 (previously: increase at a mid-single-digit rate). Operating profit is now expected to reach a level of around 700 million euros (previously: to reach a level of around 500 million euros). adidas also said that unfavourable currency effects will continue to have a significant impact on profitability this year.

Concerning the Yeezy inventory, the company reported that the latest drop generated 150 million euros and an operating profit of around 50 million euros in the first quarter. The sale of the remaining inventory during the rest of the year is expected to generate an additional 200 million euros in sales and no further profit.

Image Credits: news.adidas.com

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