Adidas Has $1.3 Billion In Unsold Yeezy Shoes – ‘Narrowing Options’

Credit: Alex Haney

Six months after rapper Kanye West’s acrimonious split, Adidas is still sitting on a mountain of Yeezy merch. Estimates put the mountain at $1.3 billion.

During his recent investor call, Adidas’ new CEO Björn Gulden said called The German sportswear giant is about to make a decision on what to do with the unsold merchandise. He told investors the company’s options were “shrinking” after it reported $441 million in lost sales earlier in the year. Gulden says there are many interested parties in the talks, but no concrete decision yet.

Gulden became CEO of Adidas in January 2023 after the company parted ways with the rapper. He says the company tries to avoid destroying the merchandise, but is also reluctant to put the sneakers up for sale because the rapper would earn royalties on any sale.

The company even considered re-stitching current inventory of Yeezy shoes to remove the rapper’s branding, but ultimately decided that doing so would be dishonest. Adidas also fears that simply giving away the unsold stock to those in need could lead to a booming black market for the Yeezy sneakers and people willing to pay top dollar for them.

Adidas hasn’t disclosed how many unsold pairs of Yeezy sneakers it has in its warehouses. Because Gulden fears that if consumers know how many are left, it “could hurt demand”. Adidas is expected to incur a €500 million loss this year if it doesn’t move remaining Yeezy shares. Net sales fell 1% in the first quarter of 2023 and would have been up 9% had sales of the Yeezy line not stopped.

Adidas is currently facing a class action lawsuit from its investors, who claim the company has known about the risks of an association with Kanye West since at least 2018. The lawsuit aims to represent people who bought Adidas stock from May 2018 to February 2023. The lawsuit points out that Ye’s 2018 comments suggested slavery was a people’s “choice,” and it is reported that Kanye made anti-Semitic remarks in front of Adidas employees.