Adidas shoes are on display at a DSW store on January 31, 2024 in Novato, California.
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Adidas A person familiar with the matter confirmed to CNBC on Thursday that the company plans to cut as many as 500 jobs to streamline its operations.
The layoffs will affect employees at Adidas headquarters in Herzogenaurach, Germany, accounting for nearly 9% of the region’s 5,800 employees.
A source told CNBC that the company has not yet determined how many jobs will be laid off, but that up to 500 positions could be affected. Adidas will decide on the final figure as it progresses further.
Employees learned of the layoffs on Wednesday – a day after Adidas announced the news better than expected Preliminary profit results and 19% sales growth for the holiday quarter. Sales are expected to rise to 5.97 billion euros, according to London Stock Exchange Group (LSEG), up from the 5.68 billion euros analysts expected before the announcement.
A spokesperson said in a statement to CNBC that Adidas’ current operating model has become “too complex” and the layoffs are intended to simplify operations.
“To position adidas for long-term success, we are now starting to consider how to align our operating model with the realities of our work. This may have an impact on the organizational structure and number of positions at our headquarters in Aurach, Herzogen,” the spokesman said. “We will now begin to work closely with the works council to ensure that all employees are treated with the utmost respect and care when dealing with any changes.”
The spokesman said the layoffs were not part of a cost-cutting plan but were an effort to adapt the business to changes over the past few years.
Adidas has been restructuring its business and ended 2024 with sales and profits above analyst and company expectations.
It relied on classic samba and gazelle styles to boost sales and also benefited from slowing sales. Nikeits biggest competitor.
