Adidas CEO, Kasper Rorsted, is stepping down from his position after a mutual agreement between himself and the Adidas Supervisory Board was reached. Now there is a search for a replacement.
According to a press release, Rorsted will “remain CEO until a successor has been appointed.”
Thomas Rabe, Chairman of the Supervisory Board, expressed thanks to Rorsted:
“We would like to thank Kasper for his major achievements. During his tenure since 2016 he has strategically repositioned the company and fast-forwarded its digital transformation.”
Under Rorsted’s leadership adidas saw their online sales grow “by a factor of more than five.” He also “doubled” sales in North America. In addition to impressive sales figures, his tenure saw the “share of women in leadership positions” increase “significantly.”
Why is Rorsted leaving then? Rabe explains that:
“After three challenging years that were marked by the economic consequences of the Covid-19 pandemic and geo-political tensions, it is now the right time to initiate a CEO transition and pave the way for a restart.”
Rorsted echoes these statements:
As a company, we have achieved great progress in stragic areas of our business… The past years have been marked by several external factors that disrupted our business significantly. It required huge efforts to master these challenges. This is why enabling a restart in 2023 is the right thing to do – both for the company and me personally.”
Rorsted joined Adidas in 2016 and was granted a contract in August 2020 until July 31, 2026. His tenure has been cut by three years.
This move has come shortly after Adidas lowered their earnings projections for 2022 due to Covid-related problems in China. They expect their revenue to decline at a double-digit rate for the rest of 2022. In addition, the company has expressed excess inventory is a challenge that will weigh on profits.
Adidas now expects their gross margin to sit around 49% in 2022, down from the 50.7% of previous expectations. Net income from continuing operations is expected to reach approximately €1.3 billion, down from €1.8-1.9 billion.
While that may seem all doom and gloom, Adidas noted that they hadn’t experienced a meaningful slowdown in sales nor any major cancellations of wholesale orders. The adjusted outlook is accounting for what Adidas sees as a potential slowdown of consumer spending globally.
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