Kanye West's worst nightmare is coming true — Adidas plans to sell Yeezys under new branding
- On an earnings call Wednesday, Adidas said it plans to release more Yeezys under its own branding.
- Adidas terminated its partnership with Ye in October, but it still owns the designs.
Adidas intends to release more Yeezys, but without Ye, as early as next year, the company said on its quarterly earnings call November 9.
Adidas began its partnership with Ye, formerly known as Kanye West, in 2013. The nine-year relationship proved to be financially successful but turbulent. Adidas ultimately cut ties with the musician and fashion designer on October 25 in the wake of antisemitic comments and a string of public criticisms from him.
Ye frequently fought publically with Adidas management, including in June when he forcefully objected to the company releasing slides that resembled the Yeezy Slide, calling them, "a fake YEEZY made by Adidas themselves."
"I'm not standing for this blatant copying no more," he wrote on Instagram reacting to images of the Adidas Adilette slide. Ye has also condemned Adidas for creating "Yeezy Day" without his approval, naming sneaker releases on its own, and not creating physical retail stores devoted to his brand.
On a Wednesday call to discuss quarterly earnings, Adidas Chief Financial Officer Harm Ohlmeyer reiterated the company owns the designs it made in partnership with Ye.
"Adidas is the sole owner of all design rights registered to existing product," he said. "We intend to make use of these rights as early as 2023."
Pressed during a subsequent Q&A with reporters, Ohlmeyer declined to elaborate on Adidas' plans, beyond repeating the company owns "all the versions and new colorways. It's our IP."
—sockjig (@sockjig) November 9, 2022
An exception could be the Yeezy Slide, for which Ye owns the patent.
A reporter asked Ohlmeyer if there was any reputational risk to the company if it continued to release Yeezy products despite no longer having the backing of the artist.
"We are working through all the options," Ohlmeyer said. "When the time is right we will be more specific."
Sneaker Twitter's reaction to Adidas rebranding Yeezy is that the shoes will likely sell, but won't generate the previous hype achieved with Ye's involvement.
When Adidas announced its split with Ye, the company said it expected its bottom line to take a $247 million hit this year. Wednesday's earnings report was in-line with that forecast. Ohlmeyer added the company's annual revenue would be roughly $502 million lower than expected this year.
But Adidas will save roughly $302 million in 2023 because of royalties and marketing costs it will no longer pay to support the Yeezy business. When Kanye left Nike for Adidas in November 2013, he criticized Nike – and then-CEO Mark Parker – for not paying him royalties on sold shoes.
—Vikram Ramalingam (@VRAMM17) November 9, 2022
"Nike told me, 'We can't give you royalties because you're not a professional athlete,'" West said in 2013.
Ohlmeyer was also asked if Adidas planned to destroy existing merchandise or release it at a later date.
"We need to take our time to review what the best options are," Ohlmeyer said. "When the time is right we will be more concrete."
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