What had once been Adidas' biggest collaboration soon turned into its biggest regret, leading to a tumultuous multi-year feud. However, the company has finally woken up from its nightmare and is seeing the fruits of it.
In December 2013, Adidas announced an upcoming shoe collaboration with American rapper and record producer Kanye West, who now goes by the name Ye.
This partnership went viral because Ye was one of the most influential rappers at the time. He currently has 24 Grammys under his belt and has collaborated with some of pop culture's most prominent figures, including Jay-Z and Beyonce.
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The first Yeezy shoe line came out in 2015 with a limited drop that completely sold out within minutes of its release.
Although the Yeezy brand was a complete success, amounting to half of Adidas' total profits during its peak, the company decided to end the partnership in 2022 to show it didn't support Ye's behavior or ideals after the rapper made multiple outrageous comments that were deemed offensive, racist, and antisemitic.
Adidas said that the termination of the partnership would be effective immediately, ending all Yeezy production and stopping payments to Ye's company.
However, this split came at a hefty cost to Adidas, costing around €250 million in 2022.
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After the split, Adidas was left with approximately $1.3 billion of unsold Yeezy products, which the company continued to sell in an effort to get rid of all its Yeezy-related stock and recover some of its high-budget investment.
In May 2023, Adidas filed a federal lawsuit against Ye to freeze $75 million allegedly deposited in the Yeezy brand's account. However, Adidas dropped the lawsuit only hours later and announced both parties would resolve matters privately.
Adidas announces its latest Yeezy drop of existing products; Ye retaliates
In February 2024, Adidas announced it would release its remaining Yeezy inventory with products from the 2022 line, which included the Yeezy Boost 350 V2 in steel grey along with other styles.
Immediately after the Adidas announcement, Ye quickly retaliated by posting an Instagram video for his fans to see, claiming that Adidas was suing him for $250 million while dropping unapproved colorways and profiting off Yeezy products without remunerating him.
Kanye says Adidas is suing him for 250M while selling Yeezy’s with his name on it without paying him. Other celebrities need to speak out and bring attention to this because it could be them too one day pic.twitter.com/wxBBbiSHHA
— Ye Streams (@kanyestreams1) February 26, 2024
Additionally, the rapper posted an Instagram picture of the Adidas Yeezy drop, claiming that "Anybody who loves Ye would not buy these fake Yeezys." Although Ye has deleted almost every post on his Instagram account, various accounts screen-shotted and screen-recorded his multiple posts to repost them on their own X platforms.
KANYE WEST Responds After ADIDAS Continue To Sell Off The Rest Of Their YEEZY Sneakers 👀 pic.twitter.com/Ut1NmmmUii
— HypeNeverDies (@HypeNeverDies) February 26, 2024
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Adidas announced its settlement with Ye over the Yeezy chaos
On Tuesday, Adidas (ADDDF) announced it had reached an out-of-court settlement with Ye to end all feuds and legal proceedings between them regarding the Yeezy brand.
As Adidas stated, neither party was awarded money, and both agreed to move on from the issue amicably.
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According to Adidas' Q3 earnings report for 2024, sales are up 10%, driven by Adidas brand growth of 14% compared to the year prior.
As stated in the earnings report, the Yeezy shoe stock has shrunk from €500 million to €50 million, and the company plans to sell the remaining product by the end of this year.
Adidas donated €250 million in total from Yeezy proceeds and released €100 million in provisions to the Adidas Foundation.
In the first nine months of 2024, Yeezy products generated revenues of €550 million, with around €200 million generated in Q3 alone.
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