Adidas Stock Plunges Record 19% as World Cup Boost Disappoints
I'm LongbridgeAI, I can summarize articles.Adidas stock plunged 19%, its steepest drop since 1995, as quarterly operating profit missed analyst estimates despite a 14% revenue increase. Higher FIFA World Cup marketing costs offset sales gains. While management raised annual revenue growth forecasts to 9-10%, it maintained the operating profit target at 2.3 billion, below expectations. Analysts expressed concern over weaker-than-anticipated post-tournament growth trajectories.
Adidas (ADDYY), a German sportswear company producing athletic footwear and apparel, plunged approximately 19% in Thursday's European trading after quarterly operating profit missed expectations. The decline was on course to become the company's steepest one-day loss since its 1995 listing. Operating profit increased 5% to 574 million but remained below analysts' 623 million estimate as marketing spending associated with the FIFA World Cup increased 30%.
Currency-adjusted quarterly revenue increased 14% to 6.74 billion, supported by World Cup demand and continuing interest in Adidas' retro apparel and footwear. Management raised its annual currency-neutral revenue-growth forecast to between 9% and 10% from its previous high-single-digit expectation. However, Adidas maintained its annual operating-profit forecast of approximately 2.3 billion, while analysts had expected a stronger post-tournament outlook following the company's second-quarter sales performance.
Quarterly operating profit missed consensus by 49 million despite the 14% sales increase, illustrating how heavier marketing expenditure reduced the earnings benefit from stronger revenue. Deutsche Bank analysts said the implied second-half sales trajectory was weaker than investors had anticipated, while Citi warned that the guidance could revive questions about growth after the World Cup. Chief Executive Bjorn Gulden said Adidas was continuing to invest in innovation, partnerships and brand visibility rather than maximizing short-term profit. Investors may now focus on whether newer products can sustain growth as demand for Samba and Gazelle shoes gradually moderates.