adidas (ADS) Q2 2024 TU earnings summary

Executive summary

• Q2 2024 currency-neutral revenues rose 11% year-over-year; euro revenues up 9% to €5.822 billion.

• Excluding Yeezy, currency-neutral revenues increased 16% year-over-year.

• Operating profit for Q2 reached €346 million, up from €176 million last year, including €50 million from Yeezy inventory sales.

Financial highlights

• Gross margin in Q2 was 50.8%, nearly flat compared to 50.9% in Q2 2023.

• Underlying gross margin improved due to better sell-throughs, reduced discounting, lower sourcing costs, and favorable category mix.

Outlook and guidance

• Full-year 2024 currency-neutral revenue growth now expected at high-single-digit rate, up from previous mid- to high-single-digit guidance.

• Operating profit guidance raised to around €1.0 billion for 2024, up from €700 million.

• Assumes remaining Yeezy inventory will be sold at cost, adding €150 million in sales but no further profit.