If you have been following the news lately, it is known that the world is fighting a global pandemic meaning that every sector of the industry is struggling to do any business right now. Therefore, it is understood that companies will have a slump in their forecasts of profit. As far as the companies and their profits are concerned, we now have a new report from Adidas and the things are not looking great for the footwear brand. It is known that the things being sold are only being done via e-commerce meaning that only deliveries are possible.
It is seen that stores are not open meaning that sale of things that need a physical touch is shut down. This also includes shoes which need to be tried on in order to decide before buying. Now, Adidas has said that they are seeing a 97% slump in their net profits. They have said that “Our focus on accelerating our own-retail and digital business”
Adidas CEO also said that “Our results for the first quarter speak to the serious challenges that the global outbreak of the coronavirus poses even for healthy companies,” It is also dramatic to see the numbers released by Adidas in its earnings call. The company revealed that their net income from continuing operations was €20 million (£17.3 million) down dramatically from €631 million in the same period last year
This means that not only is the net profit from Adidas down dramatically, but it is also possible that the company is making huge losses. However, it is worth noting that the company said that it has seen a growth of 35 per cent in the e-commerce department of the country which is currently the only thing open right now. Adidas also says that it is “making use of the flexibility in its operating cost base but largely refraining from measures that would jeopardize future prospects.”