The German sportswear giant, adidas, saw their home team win the FIFA World Cup in their signature stripes earlier this month. Even though they struck success with that huge sponsor, it is proving to not be enough to boost sales. Dropping in almost a third of their income, adidas blames Russia for this heavy decline. Adidas owns 1,000 stores in Russia, but due to the decrease in value of the Rouble and uncertainty of consumer traffic, they will be shutting down a few of their stores to help maintain the balance.
Although the profit warning could have been predicted many months ago, the severity of the issue came as a surprise. Making its way back into the clear, chief executive Herbert Hainer had this to say about the company’s rise in his statement:
“Everything we announced today has one objective: to strengthen our brands, to drive consumer desire, and to set our group up for long-term success… We will return the group to a higher and more consistent level of earnings growth in the mid to long term.”