Adidas has announced its plans to turn around the business after its split with Kanye West, according to a Reuters report. The company’s new CEO, Kasper Rorsted, stated that Adidas will focus on expanding its marketing efforts and improving its merchandise lineup in order to regain market share. Rorsted also emphasized that the company has a strong financial position and will continue to invest in growth opportunities.
The company’s financial situation, however, is not without its troubles. Adidas recently warned of its first annual loss in three decades and cut its dividend, as reported by CNBC. The split with West is just one factor behind the company’s financial struggles, along with a slowdown in China and other market challenges.
As Fox Business reports, Adidas plans to cut dividends in the wake of its split with West. This decision comes as the company looks to conserve capital and focus on growth initiatives. Adidas had previously announced plans to invest heavily in marketing and product development.
Perhaps the biggest impact of the split with West is the hit to earnings, which ABC News reports was expected to be significant. Adidas took a beating as a result of the split, which coincided with a slump in Chinese demand for its products. While the company remains optimistic about its ability to turn things around, the road ahead is likely to be challenging.
One area of uncertainty for Adidas is what to do with its $526 million in Yeezys, as Business Insider reports. While the company has not yet made a decision, it is clear that it will need to take steps to manage the inventory and move forward in a way that helps the company return to profitability.
Overall, Adidas faces significant challenges in the wake of its split with West. While the company remains optimistic about its future prospects, it is clear that a strong focus on growth and revitalizing its merchandise lineup will be essential in delivering long-term success.