Trump tariff impact: Adidas freezes 2025 outlook despite strong first quarter
Adidas said that under normal circumstances, it would have upgraded its full-year outlook.
Adidas AG has opted not to raise its financial targets for 2025, even after posting stronger-than-expected first-quarter profits, due to the rising concerns over US President Donald Trump-imposed trade tariffs.
The tariffs imposed by the United States will raise prices on consumers in the world’s biggest sports market and could upend the German brand’s momentum.
“Cost increases due to higher tariffs will eventually cause price increases, not only in our sector, but it is currently impossible to quantify these or to conclude what impact this could have on the consumer demand for our products,” Chief Executive Bjoern Gulden said in the statement, which expanded on last week’s preliminary report of surprisingly robust earnings.
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The German sportswear giant acknowledged that under normal circumstances, it would have upgraded its full-year outlook given the solid start to the year.
“We therefore stick to our original outlook but admit that there are uncertainties that could put negative pressure on this later in the year,” he said.
Unexpectedly high US import levies on Southeast Asian countries such as Vietnam and Indonesia, now paused until July, have blindsided sportswear makers, which had relied on supplies from those countries to mitigate the impact of US tariffs on goods from China.
Adidas announced profit targets in March
In March, Adidas said it expects to generate operating profit of €1.7 billion to €1.8 billion this year, which disappointed investors. It also forecast currency-neutral sales to grow at a high-single-digit rate.
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Adidas is still benefiting from its two-year hot streak for classic sneaker models including the Samba and Gazelle, which helped it take market share from industry leader Nike Inc. Gulden has projected confidence that the buzz is helping Adidas pull in new customers for apparel and performance sports gear.
Meanwhile, the company is trying to extend the trend into other sneaker models, including the thin-soled Tokyo and Taekwondo.
(with Bloomberg inputs)
