adidas smashes Q3 expectations with €6.63bn revenue as performance products fuel post-Yeezy rebound

adidas AG has raised its full-year 2025 profit outlook to €2.0 billion following a record-setting third quarter that saw brand-level revenues increase 12% in constant currency terms, even as Yeezy-related sales dropped out of the equation entirely. The German sportswear maker reported total Q3 revenue of €6.63 billion, its highest-ever quarterly figure, underscoring strong brand momentum across categories, channels, and regions.

Excluding the prior-year boost from approximately €200 million in Yeezy revenue, adidas still managed to grow total revenue by 8% on a currency-neutral basis. In euro terms, this translated into a year-over-year increase from €6.44 billion to €6.63 billion. Gross margin rose 50 basis points to 51.8% despite negative currency impacts and higher U.S. tariffs, while operating profit surged to €736 million—an improvement of €138 million over Q3 2024. The operating margin for the period stood at 11.1%, up from 9.3% a year earlier.

adidas AG also updated its full-year guidance, now forecasting around 9% growth in currency-neutral revenue when factoring in the €650 million of Yeezy-related sales booked in 2024. This compares to its previous expectation of a high-single-digit increase. The operating profit forecast has been revised upward from a range of €1.7 billion to €1.8 billion to a firm target of €2.0 billion.

How did adidas AG achieve record quarterly sales without Yeezy in the mix?

The third quarter of 2025 marked adidas AG’s first major test as a post-Yeezy business. With all remaining Yeezy inventory sold off by the end of 2024, many institutional investors were closely watching whether the company could sustain growth on the strength of its core brand.

The results appear to validate that transition. Currency-neutral revenue for the adidas brand rose 12% compared to the prior year, with CEO Bjørn Gulden calling it “the highest we have ever achieved as a company in a quarter.” Notably, this growth came without the Yeezy line’s high-margin, limited-release products, which had contributed significantly to past quarterly results but also introduced volatility.

Instead, the gains were broadly distributed. adidas AG reported double-digit increases across geographies, product divisions, and sales channels. The performance category—especially running, football, and training—was singled out by Gulden as a key driver of growth. Lifestyle segments also held firm, but the acceleration in technical and sport-led products indicates a successful pivot back to adidas AG’s performance roots.

What helped adidas AG improve margins despite tariff pressures and FX headwinds?

Gross margin improvement to 51.8% in Q3 2025 represents a noteworthy achievement given the company’s exposure to both unfavorable foreign exchange trends and escalating U.S. import duties. According to management, the margin expansion was made possible through a combination of better inventory management, pricing power, and successful cost mitigation strategies.

On the operational side, adidas AG has taken steps to adjust sourcing strategies to limit exposure to high-tariff regions. Additionally, continued growth in direct-to-consumer channels, including e-commerce and flagship retail stores, helped protect margin by reducing reliance on wholesale partners. The direct channel not only commands higher average selling prices but also provides greater control over inventory turnover and promotional cadence.

The 1.8 percentage point expansion in operating margin—from 9.3% to 11.1%—was also bolstered by disciplined cost control across marketing, logistics, and administration. These gains more than offset the incremental costs associated with U.S. tariffs and adverse FX.

What does adidas AG’s revised FY2025 guidance reveal about management confidence?

The new full-year guidance implies a solid end to 2025 and signals increased management confidence heading into 2026. adidas AG now expects currency-neutral revenue to grow around 9%, up slightly from previous guidance, and operating profit to reach €2.0 billion—marking a €200–€300 million upgrade versus the earlier target.

Importantly, the revenue guidance accounts for the base effect created by Yeezy’s €650 million contribution to FY2024 results. This means adidas AG is on track to outperform last year’s revenue even without one of its historically largest contributors.

The company emphasized that the guidance upgrade reflects not just strong Q3 results, but also continued momentum into Q4, better-than-expected brand heat, and the successful mitigation of external cost pressures. CEO Bjørn Gulden stated that “2025 is a success for us already,” noting particular strength in performance categories across all global regions.

How are analysts and institutional investors reacting to adidas AG’s Q3 2025 earnings beat and FY2025 profit upgrade?

Investor sentiment appears to have turned firmly positive following the Q3 pre-announcement. Analysts covering European consumer and apparel sectors are likely to revise their models upward ahead of adidas AG’s full Q3 earnings release and conference call on October 29, 2025.

The absence of Yeezy no longer seems to be a drag on valuation. Instead, investors are focusing on adidas AG’s ability to build sustainable momentum through innovation, category diversification, and geographic breadth. Institutional flows have gradually returned to the stock in recent quarters, as fears of brand erosion have been replaced by optimism over operational discipline and core-brand scalability.

While some analysts remain cautious about lingering macroeconomic risks—such as inflationary headwinds in Europe and softening discretionary spending in North America—the strong margin delivery has helped reframe the narrative around adidas AG as a profitable, resilient player with clear growth levers.

What are the implications for 2026 and how is adidas AG positioned for major global sporting events?

Looking ahead, adidas AG is preparing to capitalize on a sports-packed 2026, beginning with the Winter Olympics and culminating in what will be the largest Football World Cup in history. These events are expected to drive demand for performance-focused products across key markets.

CEO Bjørn Gulden reiterated the importance of 2026, stating that it will be “another exciting sports year.” He emphasized that adidas AG is well-positioned due to its portfolio spanning sport, lifestyle, and comfort. The company expects global demand across these segments to remain strong and is aligning product drops and marketing campaigns accordingly.

adidas AG is also doubling down on digital transformation and direct-to-consumer expansion. The company’s e-commerce platforms have continued to grow and now represent a material portion of global revenue. Strengthening digital capabilities, personalization, and data-driven inventory forecasting are all strategic priorities heading into the next fiscal year.

With no major inventory overhangs and clean financial optics following the Yeezy wind-down, adidas AG enters 2026 with both operational flexibility and a compelling event calendar to support growth.

What are the key takeaways from adidas AG’s Q3 2025 results and upgraded full-year guidance?

• adidas AG reported record Q3 2025 revenue of €6.63 billion, the highest in company history, marking 12% brand growth in constant currency and an 8% increase overall, even after excluding Yeezy sales.

• The company’s gross margin expanded to 51.8%, while operating profit surged to €736 million, pushing operating margin up to 11.1% despite FX and tariff headwinds.

• adidas AG raised its FY2025 profit guidance to €2.0 billion, up from the earlier €1.7–€1.8 billion range, and now expects around 9% currency-neutral revenue growth, factoring in the Yeezy base effect.

• CEO Bjørn Gulden described 2025 as “already a success”, highlighting strength across performance categories, direct-to-consumer channels, and global markets.

• The post-Yeezy transition has been executed cleanly, with no drag on profitability or brand momentum, improving sentiment among institutional investors.

• Analysts expect earnings upgrades and stronger Q4 guidance, as adidas AG heads into a 2026 sports cycle packed with the Winter Olympics and Football World Cup.

• The stock is regaining investor confidence amid disciplined cost control, pricing power, and category-led growth, positioning adidas AG as a stronger, leaner sportswear leader.