ISTANBUL — Shares of German sportswear giant Adidas plunged by as much as 17% after the company reported second-quarter operating profit below market expectations, disappointing investors despite strong sales growth.

Adidas reported €6.74 billion in second-quarter revenue, up 14% year-on-year and ahead of expectations. However, operating profit rose just 5% to €574 million, falling short of analysts’ forecast of around €623 million.

World Cup Spending Weighs on Profit

The weaker-than-expected profitability was largely attributed to higher marketing expenses linked to the 2026 FIFA World Cup. Adidas significantly increased its promotional spending ahead of the tournament, putting pressure on margins despite strong demand for its products.

Chief Executive Officer Bjørn Gulden defended the increased marketing investment, arguing that the spending was aimed at strengthening the company’s brand, innovation and partnerships.

The company’s sales performance was particularly strong outside Europe, with several international markets recording double-digit growth. However, investors focused on the gap between revenue growth and profitability.

2026 Revenue Outlook Raised

Despite the market reaction, Adidas raised its full-year 2026 revenue outlook. The company maintained its operating profit forecast at approximately €2.3 billion, signaling that management remains confident in its underlying business performance.

Analysts said investor expectations had risen significantly ahead of the World Cup, increasing the risk of disappointment if the tournament failed to deliver a stronger-than-expected boost to earnings.

The sharp sell-off came despite Adidas shares having performed strongly in recent months. The stock’s decline following the earnings announcement erased much of that momentum and highlighted investors’ growing focus on the company’s profitability and post-World Cup outlook.

CFO Change Announced

Adidas also announced a change at the top of its finance organization. Birgit Kretschmer will succeed current Chief Financial Officer Harm Ohlmeyer at the end of the year.

The leadership change comes as Adidas navigates elevated marketing costs, shifting consumer demand and expectations for continued growth following the 2026 World Cup.

Source: Patronlar Dünyası/ Prepared by: İlayda Gök