Adidas cut its 2018 revenue forecast on Wednesday after third quarter sales fell in western Europe, where it was hit by changing fashions and Nike's gains in soccer. While the German sportswear firm has been taking market share in North America, its US rival has been powering ahead in Europe, helped by a strong showing by Nike-sponsored teams at the soccer World Cup and its Phantom range launch.
Adidas shares, which have gained 12 percent in the last year, were down 2.3 percent by 0954 GMT after it cut its 2018 target for currency-neutral sales growth to between 8 to 9 percent from "around 10 percent". Chief Executive Kasper Rorsted has focused on improving profitability at Adidas since he took over in 2016, by focusing on growing in North America and Asia and pushing ecommerce, where margins are higher than in stores.
Adidas said it now expects 2018 net income from continuing operations to grow 16 to 20 percent, compared with previous guidance of 13 to 17 percent. After an earlier warning that western European sale were likely to be flat in the second half, Adidas said the region's currency-adjusted sales fell 1 percent in the third quarter.
Rorsted said Adidas had relied too much on shoes like its retro Stan Smith and Superstar that have fallen out of fashion, and not enough on sports performance gear. "We are a sports company. We should have done a better job in the sports channel," he told journalists. Adidas had also failed to react quickly enough to demand for its new styles like Continental shoes, and had overpriced some goods, all factors it is now addressing, Rorsted added.
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