scorecardBeyoncé's line with Adidas is reportedly struggling, driving home the challenge of filling the $2 billion hole left by Kanye West's Yeezy line
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Beyoncé's line with Adidas is reportedly struggling, driving home the challenge of filling the $2 billion hole left by Kanye West's Yeezy line

Matthew Kish,Lakshmi Varanasi   

Beyoncé's line with Adidas is reportedly struggling, driving home the challenge of filling the $2 billion hole left by Kanye West's Yeezy line
Retail2 min read
  • The Wall Street Journal on Wednesday reported sales for the singer's Ivy Park Adidas line fell 50%.
  • Adidas' struggles to gain traction with Ivy Park come after the brand cut ties with Kanye West.

Beyoncé on Sunday became the most-decorated artist in Grammys history. On Wednesday, a less-stellar Beyoncé headline appeared in the Wall Street Journal.

The newspaper reported the celebrated musician's partnership with Adidas is coming up short of sales projections. Sales of the Ivy Park line with Adidas decreased more than 50% to roughly $40 million last year, well short of the company's $250 million forecast, according to the Journal.

The struggles of the line further underscore the challenge facing Adidas in the wake of its split with Ye, formerly known as Kanye West. The company lost ground against rival Nike in recent years and hasn't found any big tranches of sales to replace the estimated $2 billion in sales generated by Ye's Yeezy line.

"I think it is critical to remember that over the past decade, all things considered, and with enough ad spend, it has not been 'hard' to reach $50 million of revenues selling apparel," said BMO Capital Markets managing director Simeon Siegel, in an email to Insider. "Doing it profitably and sustainably, on the other hand, was another story."

Siegel added it's difficult to grow apparel businesses from $100 million to $300 million.

In a recent note to investors, Baird's Jonathan Komp described Adidas as a "story in transition," noting the January arrival of new CEO Bjørn Gulden, who's gotten largely positive reviews for his previous work as CEO of Puma.

Komp is optimistic about Gulden but noted lingering brand headwinds in China and from winding down the Yeezy line.

In a statement to Insider, an Adidas spokesperson said the brand's partnership with Beyoncé is "strong and successful."

"As part of our valued strategic partnership with lvy Park, we continue to be inspired by our collective vision and are proud of the work we have created together," the spokesperson said. "As a matter of principle, we do not disclose key financial figures for individual product categories."

The Adidas line with Ivy Park launched in 2020. The contract between Beyoncé and Adidas expires after 2023, according to the Journal, which reported Adidas has discussed ending or revising the deal.

While the future of Ivy Park with Adidas is uncertain, Adidas has announced two other potentially significant moves in recent days, including a new Sportswear line aimed at Gen Z - the first full collection launch in 50 years - and a new partnership with the global fitness brand Les Mills.




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