Adidas shares plunge in Frankfurt following disappointing earnings

(Il Sole 24 Ore Radiocor) - A wave of selling on Adidas on the Frankfurt Stock Exchange. The slump follows quarterly results characterised by operating profit below expectations. The group has thus recorded its biggest ever intraday fall; compared with its performance since the start of the year, the share price has gone from +7.8% to -10.5% in just a few hours.

Looking at the financial results in detail, second-quarter turnover rose by 14% excluding currency fluctuations, reaching 6.74 billion euros, exceeding the 6.63 billion euros forecast by analysts. However, operating profit rose by 5% to 574 million, compared with market estimates of around 620 million. Profitability was primarily squeezed by marketing expenditure, which rose by over 200 million to 924 million, around 30% higher than the previous year. Adidas has, in fact, invested heavily in the 2026 World Cup, with campaigns featuring football stars such as Lionel Messi and Lamine Yamal, whose national teams faced each other in the final and were both kitted out by Adidas. Higher transport and procurement costs, as well as US tariffs, also weighed on the figures.

It should be noted, however, that the investment in marketing has led to a sharp acceleration in sales. Adidas has reported that it sold four times as many shirts and twice as many footballs as during the previous World Cup, generating around 1.5 billion euros in event-related revenue. Direct sales through shops and online channels grew by 25 per cent. Growth was in double figures across all regions (particularly in North America, +17 per cent) except Europe, where revenue rose by 6 per cent.

“In absolute terms, the second quarter was positive, but given the rising expectations surrounding the World Cup, the result will disappoint investors,” wrote Deutsche Bank analysts, highlighting the negative surprise in earnings. “Together with the World Cup’s more pronounced contribution to revenue, this is likely to reignite the debate on the sustainability of growth after the tournament,” noted analysts at Citi.

Adidas has, however, raised its 2026 revenue guidance, forecasting growth at constant exchange rates of between 9% and 10%, compared with the previous guidance of a high single-figure increase. The target for operating profit of around 2.3 billion has been confirmed, although the forecasts do not include any further US tariffs refunds, estimated at between 250 and 300 million dollars.