adidas today "raised its full-year guidance" after Q3 net profit "rose 10% on strong demand" for its Reebok and namesake brands, according to Ellen Emmerentze Jervell of the WALL STREET JOURNAL. The company "reported net profit" of $339M in Q3, up from $307M in the same period last year. Strong sales momentum at all of its big brands, including its "previously struggling golf business, contributed to the improvement, with third-quarter group revenue rising 13% when adjusted for currency effects" to $5.18B. The company's "robust performance" comes after Chair & CEO Herbert Hainer "found himself under pressure to restore Adidas' cool status and regain market share, particularly in the U.S., where it has lost ground to rivals" such as Under Armour. The adidas and Reebok brands in Q3 "generated strong momentum, with sales rising 14% and 3%, respectively." The company's lifestyle business, with brands such as Originals and Neo, "boosted Adidas’ brand sales." Hainer said that Originals sales "were up 33% in the quarter." He added the momentum of the lifestyle business was "just amazing.” TaylorMade-adidas Golf "also gave investors a positive surprise." After 18 months of "sliding sales, Adidas reported 6.5% year-over-year quarterly growth at that business" (WSJ.com, 11/5).
CUTS COMING TO TAYLORMADE: The FINANCIAL TIMES' James Schott reports adidas "revealed plans to cut staff at its TaylorMade golf business" by 14%. Golf revenues "staged a recovery" in Q3, but adidas said that the unit "still needed to become more 'nimble.'" The company said that job cuts at the division -- which "had 1600 staff at the beginning of the year -- will cost Adidas 'a low-double-digit million euro amount' in the fourth quarter, but should improve profitability thereafter" (FINANCIAL TIMES, 11/5).
FINE WITH FIFA: Hainer said that the ongoing FIFA corruption scandal is "not tarnishing the image" of its company. The company noted that sales of its soccer products "rose" 19% in Q3. Hainer: "The image for our products have never been better so I am definitely convinced that the consumers clearly differentiates between us as a company and the brand and what's going on in FIFA." adidas has provided the FIFA World Cup match ball since '70 and two years ago "extended its partnership with FIFA" until '30 (REUTERS, 11/5).
