Adidas will sell some of the merchandise from its defunct Yeezy partnership with rapper Kanye West and donate part of the proceeds to international organisations, CEO Bjoern Gulden said today.
The German sportswear giant has been in a predicament over the Yeezy stock since it cut ties with West over his anti-Semitic comments late last year, with the controversy weighting on its stock and hitting its bottom line.
Millions of Yeezy brand shoes with a retail value of €1.2 billion are sitting in storage after their sale was put on hold.
Addressing investors in the southern German town of Fuerth after the debacle contributed to the company's first annual loss in 31 years, Gulden said it had yet to be determined when and how the planned sale would proceed.
"We are working on these things. Burning the goods would not be a solution," he said.
He added the proceeds would be donated to international organisations that West, who changed his name to Ye in 2021, had harmed with his comments.
By selling some of the stock, the company is potentially minimising a $700m loss this year, but it is unclear how much stock will be sold and what proportion of the proceeds will be donated.
If the goods are sold, West will be entitled to previously-agreed commissions - 15% of turnover, according to media reports. Adidas has declined to comment on this.
Gulden defended Adidas' years-long collaboration with the rapper, saying that "as difficult as he was, he is perhaps the most creative mind in our industry".
The company's first-quarter results will likely show a 4% decline in net sales to $5.07 billion, according to a company-compiled consensus.
But investors have high hopes Gulden can turn Adidas around. The stock has gained around 65% since November 4, when the former Puma CEO was first floated as a successor to Rorsted.
