Adidas terminates partnership with Ye following rapper’s antisemitic remarks

Kanye West at an event announcing a partnership with Adidas on June 28, 2016 in Hollywood, California.Getty ImagesAdidas on Tuesday ended its partnership with Ye, formerly known as Kanye West, after the musician made a series of offensive and antisemitic comments.Adidas said in a statement: “Adidas does not tolerate antisemitism and any other sort of hate speech. 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.””After a thorough review, the company has taken the decision to terminate the partnership with Ye immediately, end production of Yeezy branded products and stop all payments to Ye and his companies. Adidas will stop the Adidas Yeezy business with immediate effect.”It said this would have a short-term negative impact of up to 250 million euros ($246 million) on net income in 2022 due to high seasonality in the fourth quarter.The German sportswear giant had faced pressure from the public and its own employees to cut ties with Ye, who said on a podcast on Oct. 16: “I can say anti-Semitic things, and Adidas can’t drop me. Now what?” Calls on Adidas had also come from at least three legal organizations, as well as anti-racism groups.Talent agency CAA confirmed it had dropped Ye as a client Monday, and he was let go by Balenciaga last week.Twitter and Instagram blocked him over antisemitic remarks. Conservative social media platform Parler then announced Ye had agreed to buy the platform.Shares fallAdidas fell 4% in morning trading in Frankfurt, after Bloomberg reported early in the day it was planning to end the partnership.The company began a review of the partnership on Oct. 6 but had been widely criticized for its inaction since then.In a LinkedIn post on Monday, U.S.-based Adidas employee Sarah Camhi wrote: “It’s been 14 days since Kanye started spewing anti-Semitic rhetoric and adidas has remained quiet; both internally to employees as well as externally to our customers.”The director for trade marketing added: “We need to do better as a brand. We need to do better for our employees and we need to do better for our communities. Until adidas takes a stand, I will not stand with Adidas.”Adidas began working with Ye in 2013, and in 2016 signed a deal to manufacture and distribute items from his Yeezy clothing line through the company. Adidas has previously said the partnership has had a “tremendous impact” on its business and is one of the most successful collaborations in the history of its industry.However, Ye has publicly criticized Adidas, along with some of his other corporate partners such as retailer Gap, in recent months.He told CNBC Adidas were “copying” his ideas, and also posted social media tirades against the company, specifically targeting Chief Executive Kasper Rorsted and board members.In a note Tuesday ahead of the announcement, analysts at Credit Suisse laid out various risks to the company, including a recent profit warning that was greater than expected.

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