Adidas shares climb after boost to guidance, while European markets slip

By Steve Goldstein

Adidas shares advanced on Wednesday as the apparel maker boosted its full-year guidance.

Adidas shares (XE:ADS) rose 4% as the company pre-released its third-quarter numbers, reporting a 27% decline in operating profit on a 6% fall in revenue. Adidas said its results were helped by selling its remaining Yeezy inventory, as well as a "better than expected" performance of its underlying business.

Adidas said it's now forecasting adjusted operating profit of around EUR100 million for the year, vs. previous guidance of break even, on a low-single digit decline in currency-neutral revenue, vs. a previous estimate of a mid-single-digit decline.

Analysts at Stifel say the implied guide for the fourth quarter is "highly conservative." "From one company to another, [Adidas CEO] Bjorn Gulden has pursued a guide low/beat-and-raise communication strategy even since FY22 results," said the analysts. Shares of Gulden's former company, Puma (XE:PUM), rose 3%.

Also rising were shares of Just Eat Takeaway (NL:TKWY), as the delivery service company's stock gained 7% after boosting guidance and launching a EUR150 million stock buyback, while ASML Holding (NL:ASML) shares fell 5% as the chip equipment maker's orders came in far below consensus estimates.

The major European stock market indexes -- the German DAX DX:DAX, French CAC 40 FR:PX1 and U.K. FTSE 100 UK:UKX -- declined after a rise in U.S. bond yields following better-than-expected retail sales.

The pound (GBPUSD) was slightly stronger after U.K. CPI, both at a headline and core level, came in a tenth higher than estimates.

-Steve Goldstein

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10-18-23 0340ET

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