Adidas shares jump to three-year high after annual profit beat
The share price of Adidas jumped on Tuesday to its highest in more than three years after the sports apparel and footwear giant smashed its own expectations with fourth-quarter profits and delivered a confident outlook on current trading.
Revenues in the fourth quarter were up 19% in constant-currency terms at €5.97bn, an a big improvement in gross margins to 49.8%, from 44.6% the year before, helped the company record an operating profit of €57m, compared with a loss of €377m previously. Analysts were expecting a loss of €63m for the quarter.
As a result, operating profits for 2024 as a whole surged to €1.34bn, up from €268m in 2023 and well ahead of Adidas's own guidance of €1.2bn. Annual revenues were up 12% at constant currency at €23.68bn.
“I am very pleased the way the fourth quarter and the full year developed for us at adidas," said chief executive Bjørn Gulden.
"19% currency-neutral growth (+24% reported) in a quarter that in general was difficult for the trade underlines the strong momentum we currently see for our brand and our products."
Looking ahead, Gulden said he "feel[s] good about the future", with the potential to increase market share across all markets.
"There is a lot of macroeconomic uncertainty right now, but we clearly have the goal to again grow double-digit with the adidas brand and use that growth to continue to improve our operating profit and make further progress towards our 10% margin target.”
By 1151 in Frankfurt, the stock was up 6.3% at €258.80, trading at levels not seen since November 2021.