Unsold Yeezys collect dust as Adidas lags on a plan to repurpose them
More than six months after Adidas cut ties with Ye, formerly known as Kanye West, the sportswear giant has been slow to release a plan on how it will repurpose the piles of unsold Yeezy merchandise — fueling frustrations among investors.
"We are working on different options," Adidas CEO Bjorn Gulden said in an investor's call on Friday. "The decisions are getting closer and closer."
Earlier this week, a group of investors filed a class-action lawsuit against Adidas, accusing the company of knowing about Ye's problematic behavior years before ending the collaboration. Adidas denies the allegations.
Adidas terminated its partnership with Ye back in October after the rapper made antisemitic comments. The company stopped its production of Yeezy products as well as payments to Ye and his companies.
In February, Adidas estimated that the decision to not sell the existing merchandise will cut the company's full-year revenue by 1.2 billion euros (about $1.28 billion) and its operating profit by 500 million euros ($533 million) this year.
The loss may be even steeper if the company does not figure out how to repurpose the already-made Yeezy products.
For months, investors have been waiting for Adidas to decide how it will offset the losses.
In an investor's call in March, Gulden said he received hundreds of business proposals, but it was important to tread carefully given the tarnished reputation that the product is associated with.
"I probably got 500 different business proposals from people who would like to buy the inventory. But again, that will not necessarily be the right thing to do, so a very difficult, sensitive situation," he said.
On Friday, Gulden told investors that "there are three, four scenarios that are now building" and the company has been in talks with "interesting parties many times."
He added that a repurpose plan could be approved in the "mid-term in the future."