Sports footwear and apparel manufacturer Adidas (ADS.DE) has announced that it has terminated its marketing agreement with rapper Kanye West. The reason for Adidas' withdrawal from the partnership is a series of 'anti-Semitic and racist' posts by the rapper, who has been blocked on Twitter. The company's shares have already lost nearly 70% since peaking in 2021:
- Adidas has terminated its agreement with Ye, is phasing out its Yeezy product line and is halting all financing for the brand associated with Kanye West's image;
- The company estimates a âŽ250 million negative short-term impact on total annual net income as a result of the withdrawal.
Adidas will present its quarterly report on November 9.
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âââââââAdidas shares (ADS.DE), W1 interval. Compared to U.S. Nike (NKE.US), the sell-off in Adidas shares is much deeper. Investors are worried about the crisis in China, supply chain problems and an energy crisis that could undermine the company's margins. The company is also weighed down by the dire sentiment lingering on the German stock market. The severance of the Ye deal is another 'blow to the company. Looking at the fundamental side, however, the stock may look increasingly attractive to long-term investors relying on fundamental analysis. The termination of Ye's contract is likely to have only a short-term impact on the German giant's operations. Source: xStation5
