German sportswear giant adidas has reported a decrease in sales of 3 per cent in currency-neutral to €5.964 billion in the third quarter of the financial year, lower than the analysts’ expectations of €5.91 billion.
Although sales declined 2 per cent for adidas and 7 per cent for Reebok, the company added that contrarily, it recorded a strong sequential revenue improvement in the third quarter as more than 90 per cent of its stores were open to customers as opposed to the second quarter which had them temporarily shut down.
The saving grace for the company has been its e-commerce business which has reported a currency-neutral jump of 51 per cent and the wholesale business also picked up sharply, though it still remained below the levels of last year.
The overall direct-to-customer grew 13 per cent as well.
If the results are looked at with the second quarter in mind, all markets show a sequential recovery. Sales in Russia grew 11 per cent and 4 per cent in Europe but North America, Asia-Pacific, Greater China and Latin America all saw a decrease in sales with 1 per cent, 7 per cent, 5 per cent and 13 per cent, respectively.
While the company’s operating profits fell to €794 million, it fared better than the estimated €723 million and EPS or earnings per share were down to €2.80 as compared to €3.26 for the same period in 2019.
adidas expects similar levels of sales in the next quarter as well based on the fact that shopper numbers will be hit by new lockdowns. About 93 per cent of stores are currently open.
Substantiating more, Chief Executive Kasper Rorsted said in a statement “While at the beginning of the quarter we were on track for growth in Q4, a worsening of the pandemic in many regions of the world is again requiring our patience and support.”
