Operating profit rose 16% to €705 million in the first quarter, topping analyst forecasts, even as tariffs and a stronger euro weighed on results
Adidas reported first-quarter operating profit of €705 million, up 16% from €610 million a year earlier, topping analyst expectations. Analysts had forecast €647 million, according to Reuters, about €60 million below the actual result.
Net sales reached €6.6 billion, up 7% in euro terms and 14% on a currency-neutral basis. Currency movements reduced reported revenue by more than 6 percentage points, or about €350 million, the company said.
"I am very proud of the results our teams delivered in the first quarter," CEO Bjørn Gulden said in a statement. "Sales growth of 14% to €6.6 billion and almost €100 million more operating profit to €705 million is very strong in the current environment."
Apparel was the fastest-growing product category, with currency-neutral sales climbing 31% to €2.4 billion. Footwear sales reached €3.7 billion, rising 4% on a currency-neutral basis. On a call with reporters, CFO Harm Ohlmeyer pointed to the company's strategy of front-loading World Cup inventory as a meaningful driver of the quarter's performance, saying the early shipment push was what made 14% growth achievable.
Performance products led by football, running, and training categories grew 29% on a currency-neutral basis. A tailwind for the running category came from the London Marathon $MPC, where Sabastian Sawe of Kenya made history as the first competitor to complete an official race in under two hours, crossing the finish line in Adidas shoes, Reuters reported.
Among regions, Latin America led all markets with 26% currency-neutral sales growth. The Japan and South Korea cluster followed at 23%, with Greater China at 17%. Currency translation weighed heavily on North America, which expanded 12% in constant-currency terms but registered only a 1% gain in euro-reported figures. In the Middle East, some markets saw sales decline because of the Iran war, Gulden told Reuters.
The gross margin slipped to 51.1% from 52.1% a year earlier, as currency headwinds and higher U.S. tariff costs more than offset an underlying improvement. Adidas said the combined drag from tariffs and currency is expected to reduce full-year 2026 operating profit by about €400 million, with the impact most acute in the first half of the year.
The stronger-than-forecast results did not prompt the company to raise its outlook. Adidas reaffirmed what some analysts had already viewed as a cautious stance, explaining in its release that the decision reflected "an environment that is characterized by macroeconomic challenges and elevated uncertainty." The company forecast currency-neutral sales growth at a high-single-digit rate for 2026 and full-year operating profit of about €2.3 billion.
Gulden singled out the proliferation of discounts across the sneaker market as a concern, particularly in lifestyle footwear, warning that keeping a tight rein on how much product flows to retailers is what separates brands that hold their price points from those that don't.
Adidas stock rose 7% following the results, according to Reuters.
