Adidas ends partnership with Ye, formerly known as Kanye West, over antisemitic remarks
Adidas has ended its partnership with the rapper formerly known as Kanye West over his offensive and antisemitic remarks, the latest company to cut ties with Ye and a decision that the German sportswear company said would hit its bottom line.
"Adidas does not tolerate antisemitism and any other sort of hate speech," the company said in a statement Tuesday. "Ye's recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company's values of diversity and inclusion, mutual respect and fairness."
The company faced pressure to cut ties with Ye, with celebrities and others on social media urging Adidas to act. It said at the beginning of the month that it was placing its lucrative sneaker deal with the rapper under review.
Adidas said Tuesday that it conducted a "thorough review" and would immediately stop production of its line of Yeezy products and stop payments to Ye and his companies. The sportswear company said it was expected to take a hit of up to 250 million euros ($246 million) to its net income this year from the move. The company is the sole owner of the design rights to Yeezy, Adidas said.
Adidas' deal with West officially started in 2016, with the company the time calling it "the most significant partnership ever created between an athletic brand and a non-athlete."
Other companies drop Ye
Jewish groups said the decision to drop Ye was overdue.
"I would have liked a clear stance earlier from a German company that also was entangled with the Nazi regime," Josef Schuster, president of the Central Council of Jews in Germany, the main Jewish group in the country where Adidas is headquartered.
Adidas is just the latest company to end connections with Ye, who also has been suspended from Twitter and Instagram over antisemitic posts that the social networks said violated their policies.
Earlier this month, Ye tweeted a threat that he would go "death [sic] con 3" on Jewish people, alluding to a defense readiness designation used by the U.S. military. He also posted a screenshot of a text exchange with Sean "Diddy" Combs in which he suggested Combs was being controlled by Jews.
West recently suggested slavery was a choice and called the COVID-19 vaccine the "mark of the beast," among other controversial comments. He was also criticized for wearing a "White Lives Matter" T-shirt to his Yeezy collection show in Paris. The phrase has been adopted and promoted by white supremacist groups and sympathizers, according to the Anti-Defamation League.
Ye's talent agency, CAA, dropped him, and the MRC studio announced Monday that it is shelving a complete documentary about him. Ari Emmanuel, CEO of talent firm Endeavor, last week penned an op-ed in the Financial Times urging all enterprises to stop working with Ye over his antisemitism.
The Balenciaga fashion house cut ties with Ye last week, according to Women's Wear Daily. Foot Locker also said it would stop carrying the Yeezy brand and pull Yeezy shoes from its shelves and online sites. JPMorganChase and Ye have ended their business relationship, although the banking breakup was in the works even before Ye's antisemitic comments.
"Although Adidas was somewhat late in cutting ties with Kanye West, it has now yielded to the inevitable and ended its partnership with the artist," Neil Saunders, managing director of market research firm GlobalData, said in an email. "Given the baseness of Ye's recent comments, and the fact his words are now stirring up antisemitism among others, Adidas had no choice but to act in order to protect its reputation and show customers it is on the right side of morality."
A Vogue spokesperson confirmed Tuesday that the magazine and its global editorial director, Anna Wintour, have no intentions of working with Ye again after his most controversial remarks and behavior.
In recent weeks, Ye has also ended his company's association with Gap and has told Bloomberg that he plans to cut ties with his corporate suppliers. Gap said Tuesday it is removing all Yeezy Gap products from the retailer's stores and its e-commerce site.
"Antisemitism, racism and hate in any form are inexcusable and not tolerated in accordance with our values," the apparel chain said in a statement.
Demonstrators on a Los Angeles overpass Saturday unfurled a banner praising Ye's antisemitic comments, prompting an outcry on social media as celebrities and others said they stand with Jewish people.
In 2021, Bloomberg ranked West as the wealthiest Black American, pegging his net worth at $6 billion. Morningstar analyst David Swartz told the Washington Post that Yeezy product sales generated roughly $2 billion a year for Adidas, or nearly 10% of its annual revenue.
Adidas shares fell more than 3% in trading on Tuesday and are down 61% this year.
Adidas doesn't break out Yeezy sales numbers, but the impact will be more severe than expected given that the brand has ended production of all Yeezy products and ceased royalty payments, according to Morningstar analyst David Swartz in a note published Tuesday.
Swartz projects overall Adidas revenues to reach $23.2 billion euros ($23.1 billion) this year, with the Yeezy brand generating 1.5 billion to 2 billion euros ($1.99 billion), or nearly 10% of the total. The pricy brand accounts for up to 15% of the company's net income, Swartz said.
