Adidas Raises Profit Bar For Year After Unexpectedly Strong Quarter

By David Sachs

Adidas raised its revenue and profit expectations after a better-than-anticipated first quarter.

The German shoe and sports apparel company said Tuesday that it now expects operating profit to finish the year at 700 million euros ($743.7 million) compared with its previous forecast of EUR500 million.

Revenue adjusted for currency effects is now expected to grow at a rate in the mid-to-high single-digits compared with previous expectations of mid-single-digit growth, the sportswear giant said.

Adidas's upgrade came after first-quarter revenue rose 4% on year to EUR5.46 billion. Its gross margin improved to 51% from 45% a year prior, while operating profit jumped to EUR336 million from EUR60 million.

Despite the results, Adidas still expects currency-exchange effects to constrain profitability, revenue and gross margin this year, it said.

Write to David Sachs at david.sachs@wsj.com

(END) Dow Jones Newswires

April 16, 2024 12:15 ET (16:15 GMT)

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