(CNBC) – Adidas ended its partnership with Ye, formerly known as Kanye West, on Tuesday after the musician made a series of offensive and anti-Semitic comments.
In a statement, Adidas said, “Adidas does not tolerate anti-Semitism or other forms of hate speech. Mr. Ye’s recent comments and actions are unacceptable, hateful, dangerous, and supportive of diversity, inclusion and mutuality.” It violates our company values of respect and fairness.”
“After a thorough review, the company has made the decision to immediately terminate its partnership with Ye, cease production of Yeezy-branded products, and stop all payments to Ye and his company. Adidas Yeezy business will cease immediately.”
It said this would have a short-term negative impact of up to €250 million ($246 million) on 2022 net income due to the high seasonality of the fourth quarter.
The German sportswear giant faced pressure from the public and its own employees to cut ties with Ye in an Oct. 16 podcast. So? “Calls to Adidas were also received from at least three legal and anti-racism groups.
Talent agency CAA confirmed on Monday that it removed Ye from its client list, letting him go from Balenciaga last week.
Twitter and Instagram blocked him for his anti-Semitic remarks. His Parler, a conservative social media platform, then announced that Ye had agreed to the acquisition.
Adidas fell 4% in morning trading in Frankfurt, Germany after Bloomberg reported it was planning to end its partnership.
The company began reviewing the partnership on October 6, but has since been widely criticized for its inaction.
In a LinkedIn post on Monday, US-based Adidas employee Sarah Kamhi wrote: Not only for internal employees, but also for external customers. ”
Director of Trade Marketing added: We need to do better for our employees and for our communities. I will not endorse Adidas until they stand up. ”
The German company started working with Ye in 2013 and signed a deal to manufacture and sell items for the Yeezy clothing line in 2016. Adidas previously said the partnership had a “tremendous impact” on the company’s business, making him one of the most successful collaborations in the history of the industry.
However, Ye has publicly criticized Adidas and some of its other corporate partners, such as retailer Gap, in recent months.
He told CNBC that Adidas was “copying” his ideas and posted aggressive attacks on the company on social media, particularly targeting CEO Kaspar Rorsted and members of the board. Did.
In a note Tuesday ahead of the announcement, Credit Suisse analysts highlighted various risks to the company, including recent higher-than-expected earnings warnings.
CNBC reached out to Ye’s rep, but has yet to hear back.
