© Reuters. FILE PHOTO: Adidas Yeezy shoes are seen in a store on the day Adidas terminated its partnership with the American rapper and designer Kanye West, now known as Ye, in Garden City, New York, U.S., October 25, 2022. REUTERS/Shannon Stapleton/File Photo
(Reuters) -Adidas got orders worth more than 508 million euros (about $565 million) for 4 million pairs of unsold Yeezy shoes, better than the company’s “most optimistic forecast,” the Financial Times reported on Monday.
Strong demand for the first batch of online sales would potentially save the German sportswear company from having to take a big writedown on its remaining stock, the newspaper said.
Adidas (OTC:) stopped selling Yeezy shoes from its defunct partnership with Ye in October after the rapper formerly known as Kanye West made a series of antisemitic comments.
Losing the highly profitable line hit first quarter sales at the company by around $440 million.
However, robust demand for the unsold sneakers has quelled fears at Adidas’ headquarters that Ye’s outbursts and a drop in marketing in the recent past would have made the Yeezy brand too toxic, FT said, citing sources.
Adidas declined to comment saying it was in a “quiet period” ahead of its quarterly results due Aug. 3.
The company had said in May it would donate some of the proceeds from the sales to organisations fighting antisemitism and racism.
Discussions over how much will be donated to individual charities are ongoing, the FT reported, adding that the company has chosen five charities in the US and China as a first step.
“Making donations of more than 8.5 million euros across the five charities has been discussed but no decision has been made,” FT said, citing people familiar with the matter.
The final amount donated from the sales will be much larger as the company is willing to pay a significant share of the profits from the Yeezy inventory, the report said.
Adidas had forecast a loss this year before announcing its intentions to sell leftover Yeezy stocks.
($1 = 0.8996 euros)
