Adidas returns to profitability in 2024, forecasts further growth

German sportswear giant Adidas AG closed its 2024 fiscal year with strong growth in both revenue and earnings, as expected. Management is forecasting further increases for the current year.

The figures, presented by the company on Wednesday, came as no surprise, as key data had already been pre-released in January. Last year, the group achieved total revenues of 23.7 billion euros, representing a 10.4 percent increase compared to the previous year. Adjusted for currency fluctuations, revenues grew by 12 percent.

European sales grow by nearly 20 percent

In Europe, its most important market region, Adidas saw sales increase by 19.8 percent (currency-adjusted +18.9 percent) to 7.55 billion euros. In Latin America, Adidas achieved growth of 21.0 percent (currency-adjusted +27.6 percent) to 2.77 billion euros, while in Emerging Markets, revenues grew by 16.2 percent (currency-adjusted +19.4 percent) to 3.31 billion euros.

In China, sales increased by 8.4 percent (currency-adjusted +10.3 percent) to 3.46 billion euros, and in Japan and South Korea by 3.6 percent (currency-adjusted +10.1 percent) to 1.34 billion euros. The company experienced slight declines only in North America, where revenues fell by 1.8 percent (currency-adjusted -1.6 percent) to 5.13 billion euros.

Adidas returns to profitability

An improvement in the gross margin from 47.5 to 50.8 percent, which according to the company was “mainly due to lower freight and product costs, a more favorable sales mix, and fewer discounts,” contributed to operating profit jumping to 1.34 billion euros, compared to 268 million euros in the previous year.

The bottom line showed net income attributable to shareholders of 764 million euros, after a corresponding loss of 75 million euros in 2023.

Company forecasts further revenue and operating profit growth for 2025

CEO Bjørn Gulden gave a positive assessment of the past fiscal year in light of the presented figures. “This development was much better than we had expected, and we are naturally very pleased with it,” he stated. “Although we are not yet where we want to be in the long term, it was a very successful year that confirmed the strength of the Adidas brand, the potential of our company, and the fantastic job our teams are doing. There is still much we need to improve, but I am very proud of what our people achieved in 2024.”

For 2025, management now anticipates further growth. A high single-digit percentage increase in currency-neutral revenues is forecast, with double-digit growth expected for the core Adidas brand. Operating profit is expected to improve to between 1.7 and 1.8 billion euros.