Adidas stated on Wednesday that it was beginning to turn things around, after reporting an astounding loss for 2023 as a result of the fallout from the breakup with Kanye West.

After making a profit of €612 million (£520 million) the year before, the German sportswear giant reported a loss of €75 million (£64 million) in 2023, its first in several years.

It happened after Adidas terminated its agreement with Kanye West, whose real nаme is Ye, in late 2022 following a slew of оffensive social media remarks.

Following their split from the American rapper, the sportswear business has now stated that it has given, or plans to give, more than $150 million (£117 million) to organizations that combat antisemitism from the sales of Yeezy sneakers.

Adidas and West collaborated to create the wildly popular Yeezy shoe line, thus their breakup cost the business a significant source of income and left it with an enormous amount of unsold shoes.

With two releases last year and another late last month, the brand made the decision to sell part of the leftover inventory in batches and contribute a portion of the sales to anti-hate organizations.

Adidas has contributed to the Anti-Defamation League and the Philonise & Keeta Floyd Institute for Social Change, which is directed by George Floyd’s brother and social justice activist Philonise Floyd.

However, CEO Bjorn Gulden, who took over from rival outfitter Puma shortly after the West tie-up collapsed, maintained a positive attitude in spite of the significant financial losses.

“The business will take a long time to turn around.” “The outcome is obviously inadequate,” he said during a press conference.

However, it lays the groundwork for achieving the goals we have set forth.

The 2023 results turned out to be better than anticipated, and according to Gulden, “by 2025 we should already be a good company and by 2026 we should be a really healthy company.”

Revenues decreased by 5% to €21.4 billiоn (£18 billiоn), with the United States suffering the most from the stoppage of Yeezy shoe sales.

Adidas has been working to gradually get rid of the Yeezy sneakers; two sales in 2023 will bring in a total of €750 million (£640 million).

Nevertheless, this falls short of the €1.2 billiоn (£1 billiоn) in revenue they brought in 2022.

This year, the firm anticipates selling the last pair of Yeezy shoes, bringing in an estimated €250 million (£213 million) in sales.

Sales in North America dropped significantly and are predicted to continue dropping this year, but there was positive news from China, an important market that had been hurt by the country’s strict cоrоnavirus restrictions.

Adidas reported that sales of its iconic sneakers, such Campus, Samba, and Gazelle, were increasing. Gulden has tried to concentrate on promoting these models.

Adidas predicts a resurgence in business for 2024, with operating profit predicted to reach approximately €500 million (£428 million), double the amount for 2023, and sales growth in the “mid single-digit” range.

With the European Football Championships in June and July being hosted by Germany and the Olympics in Paris shortly after, Adidas is expected to benefit from higher sales of jerseys and related items.

Nevertheless, others were dissatisfied that the company did not improve what they saw to be an unimpressive future, even if the company’s prediction was several hundred million euros below what analysts were projecting.

As per Deutsche Bank, the results did not come as a surprise, and the corporation has declared 2024 as ‘another transition year’.

“Everyone is focused on the ultimate goal and the fundamental elements that lead there,” it continued.

After the results were announced, Adidas’s stock in Frankfurt barely moved.