Adidas footwear are displayed at a DSW retailer on January 31, 2024 in Novato, California.
Justin Sullivan | Getty Photographs
Shares of Adidas fell Wednesday after the German sportswear big flagged a double-digit million euro hit from U.S. tariffs within the second quarter and warned that present import levies will push up the price of its U.S. items.
The world’s second-largest sports activities retailer mentioned that added prices related to tariffs might complete 200 million euros ($231 million) within the second half of this yr.
“The worth will increase, if any, will solely be within the U.S.,” CEO Bjørn Gulden informed reporters throughout an earnings name.
Shares shed as a lot as 9% in early commerce earlier than recovering losses barely to commerce down 6% by 9:50 a.m. London time (4:50 a.m. ET).
Adidas mentioned that it had not but applied any worth hikes in response to tariffs however had as an alternative reallocated its sourcing combine.
Gulden added that administration would conduct a pricing assessment as soon as the ultimate fee of U.S. tariffs on world imports are confirmed on or round Aug. 1., and instructed that worth will increase have been extra more likely to be utilized to new merchandise quite than current strains.
“What we are able to say is we is not going to be the worth leaders. We’ll transfer slowly and see what is occurring available in the market,” he mentioned.
The corporate meantime flagged potential broader dangers to client demand ought to U.S. tariffs set off a surge in inflation.
“Tariffs, and particularly the uncertainty, make issues troublesome proper now. For Adidas, it is about maneuvering by this as greatest we are able to with out damaging the enterprise long-term,” Gulden mentioned.
“We do additionally not know what the oblique influence on client demand will likely be ought to all these tariffs trigger main inflation,” Gulden mentioned in a press release accompanying its earnings replace.
Adidas nonetheless maintained its full-year steerage, however famous this might change because it cited “elevated uncertainty on account of U.S. tariffs and macroeconomic dangers.”
It at present expects full-year currency-neutral gross sales to extend on the high-single digit fee and working revenue to rise to between 1.7 billion euros and 1.8 billion euros.
It comes because the sports activities retailer posted weaker-than-expected second-quarter gross sales, with the U.S. seeing the softest gross sales progress.
Revenues rose 2% year-on-year within the three months to June 30 to five.95 billion euros, the corporate mentioned flagging a destructive forex influence of 300 million euros. LSEG analysts had forecast gross sales of 6.23 billion euros.
Working revenue rose 58% yearly within the quarter 546 million euros versus the 518 million euros forecast.