Adidas on Tuesday became the latest company to sever ties with the rapper Kanye West over his antisemitic comments made over social media.
Adidas said it will terminate its relationship with West, who is now called Ye, immediately.
“Adidas does not tolerate antisemitism and any other sort of hate speech. Ye’s recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness,” the company said in a statement.
Adidas said it will end production of Yeezy branded products and stop all payments to Ye and his companies, and it will stop the adidas Yeezy business with immediate effect.
The Central Council of Jews in Germany said the Adidas action was “overdue” and that it waited until other companies, such as Balenciaga, distanced themselves from West. “I would have liked a clear stance earlier from a German company that also was entangled with the Nazi regime,” said Josef Schuster, president of the group, as he acknowledged that the company had previously taken action to distance itself from its Nazi past.
Adidas said it is expected to have a short-term negative impact of up to €250 million ($247 million) on the company’s net income in 2022 given the high seasonality of the fourth quarter.
Analysts had already forecast a loss for the fourth quarter, with the FactSet-compiled consensus that the German company would lose €233 million.
The apparel maker said it provide make more guidance on the financial impact when it publishes its third-quarter results on Nov. 9.
Adidas ADS, -6.46% shares dropped 4% on Tuesday and have declined 61% this year. Adidas issued a profit warning last week, citing deteriorating traffic trends in China as well as a significant inventory build-up due to flagging demand in western markets.
Analysts at Credit Suisse, in a note issued ahead of the statement, said the Yeezy franchise brought in an estimated €700 million per year.