Adidas Announces Job Cuts Affecting Up to 500 Employees

Adidas, the global sportswear giant, is set to reduce its workforce by up to 500 positions at its headquarters in Herzogenaurach, Germany. This decision comes despite the company reporting a return to growth, highlighting the ongoing challenges facing the German economy.

The announcement was made by CEO Bjørn Gulden during a press conference, where he explained that the cuts are necessary to simplify operations. According to Gulden, the complexity within the organization has become unsustainable, prompting the need for a reduction in staff. He emphasized that the decision is about streamlining processes rather than reflecting on the performance of the employees.

Gulden stated that the company must decentralize its decision-making processes to adapt better to local market conditions, particularly in substantial markets like the United States and China. This shift aims to enhance responsiveness to consumer demands and preferences, which have been increasingly variable in recent years.

On the same day, Adidas released positive financial forecasts, predicting an operating profit of between 1.7 and 1.8 billion euros for the current fiscal year. This reflects a significant recovery, following a challenging period marked by issues related to its 'Yeezy' product line, previously designed in collaboration with rapper Kanye West. The company reported a revenue of approximately 23.7 billion euros for the last fiscal year, a rise of 11 percent compared to 2023, with a net profit of 832 million euros, recovering from a loss in the previous year.

Gulden expressed satisfaction with the company's performance, stating that the results for the fourth quarter and the overall year exceeded expectations. However, he acknowledged that there remains considerable room for improvement as Adidas continues to navigate the complexities of the global market.

This decision to downsize is part of a broader trend affecting many sectors within the German economy, where companies are increasingly forced to make tough choices in the face of economic pressure. As Adidas embarks on this restructuring phase, the focus will be on fostering a more agile and efficient organization capable of meeting evolving consumer needs.