Karma After Kanye? Adidas Warns First Annual Loss In 3 Decades Due To Yeezy Fallout

March 08, 2023

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Adidas has recently warned that the company could possibly suffer its first annual operating loss in 31 years since severing ties with Kanye West. According to the sportswear brand, it may have to write off the entire range of Yeezy-branded merchandise.

Updated By: Nicole Bartley (3/8/23 at 1:45 pm)

Since Ye’s business fallouts due to his comments deemed antisemitic, it appears his ex-partners are experiencing a difficult time. German sportswear brand Adidas announced that it may face an operating loss of $736 million, which would mark its first in 31 years.

The predicted plummet would be a result of a potential $527 million hit due to unsold Yeezy stock, including strategic review costs, according to CNN reports. On Wednesday, March 8, Adidas shares dropped 2.2% after publishing its 2022 results, which Chief Financial Officer Harm Ohlmeyer refers to as a “disappointing year.”

“We definitely did not perform as we should have performed,” Ohlmeyer admitted after presenting the results. Still, Adidas is hoping for a positive turning point this year.

JP Morgan Chase, Adidas, & Balenciaga Fall Short Since Split With Ye

Several companies such as JP Morgan, Adidas, and Balenciaga have cut ties with Kanye West since his 2022 remarks were deemed antisemitic. However, since Ye’s partnership terminations, it seems those companies are also experiencing financial and reputational issues.

Since late 2022, Kanye West has lost several business dealings. Now, it seems those same companies are experiencing financial or reputational troubles since letting him go. 

2022: JP Morgan bank cut ties with Kanye for anti-Semitism

2023 : JP Morgan is accused of being involved into the child trafficking of Jeffrey Epstein pic.twitter.com/YstLFs5q2F

— Donda Times (@dondatimes) February 16, 2023

An Unfortunate Turn Of Events

In October 2022, Ye shared a series of tweets that were deemed antisemitic. The controversial tweets led the rapper and fashion entrepreneur to be cut by major companies, including his legal team.  

Kanye’s former bank, JP Morgan Chase cut ties with him for publicly criticizing the company.  Less than four months after dropping the Yeezy mogul, former JP Morgan Chase executive Jes Staley’s alleged sexually explicit emails exchanged with the late disgraced financier Jeffrey Epstein was revealed, according to a CNN report. 

In an investigation from the US Virgin Islands government, Staley exchanged over 1,000 emails from his JP Morgan Chase email account with Epstein between 2008-2012, while he was under investigation for child sex trafficking. Staley would visit Epstein’s Virgin Islands residence while Epstein was incarcerated as well.

Balenciaga & Adidas In Hot Water

French designer brand Balenciaga cut ties with Kanye in October due to Kanye’s controversial comments. That following month, Balenciaga dropped their holiday campaign featuring children holding teddy bears in bondage harnesses and sexually explicit costumes, according to a report from The New York Times. 

The company was accused of pedophilia, and #cancelBalenciaga later trended on Twitter.   Balenciaga responded by issuing an apology statement on their Instagram story. 

“We strongly condemn abuse of children in any form. We stand for children’s safety and well-being,” the statement read. The campaign was also removed from their official website. 

Kanye also lost his deal with Adidas in October 2022.  Since Ye was released in October, the sports apparel brand could lose over $1 billion in revenue in 2023. 

The loss of revenue mostly involves the decrease in his Yeezy brand shoes, one of the company’s most popular products.  In the past,  Kanye expressed his frustrations with Adidas for making business decisions without his permission and also threatened to take them to court. 

Kanye has not publicly commented on any of the companies’ current controversies. 

New Kanye West Documentary & Podcast In The Works

A new documentary and podcast about Kanye West is on the way and will be released by the British network, BBC.

The documentary or podcast does not have a release date but will focus on Kanye’s life, music career, and controversy surrounding his comments that were deemed antisemitic.

Originally Written By: Chris Samuel (2/20/23 at 1:29 pm)

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