Adidas settled on a charitable move after deciding to sell the remaining Yeezy stock and donating the proceeds (Photo by Mauricio Santana/Getty Images).

adidas CEO Bjørn Gulden told management at the company’s Annual General Meeting yesterday (11 May 2023) in Germany, selling the remainder of the Yeezy stock from the now-defunct partnership with Kanye West and donating the proceeds to charity was a better option than burning it.

Adidas’ Gulden explained: “For the last four months we have been trying to find solutions on what to do with it [Yeezy stock]. Burning the goods is not a solution. Talking to NGOs, and other organisations hurt by Kanye’s remarks, they all said no, that burning is not the solution. What we are trying to do now over time is to sell parts of this inventory and donate money to the organisations that are helping us and that were also hurt by Kanye’s statements. How we will do that and when is unclear, but we are working on those things. But I think burning the products is not the point. And we will update you as soon as that decision is made.”

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The company is still reeling from the financial and reputational impact of the collapsed partnership and, last week, told investors it expected to incur losses this financial year due to it.

Adidas says its decision to end the Yeezy partnership significantly impacted sales during the reported quarter, reducing revenue by approximately €400bn, primarily affecting sales in the North America, Greater China, and EMEA regions.

Adidas struck a long-term deal with rapper-turned-designer Kanye West in June 2016 for the Yeezy brand in what it called “the most significant partnership ever created between an athletic brand and a non-athlete.”

But, the partnership ended last October amid antisemitic comments made by West which cost the brand dearly.

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Speaking to Just Style, Pippa Stephens, a senior apparel analyst at GlobalData, notes that Adidas has nearly dodged a bullet because destroying all remaining Yeezy stock would have inevitably resulted in mass criticism from consumers.

“Adidas’ decision to sell its remaining Yeezy stock and donate the money to charity is a sensible move, as its other options of either profiting from the sale of the products itself or destroying all remaining stock would have inevitably resulted in mass criticism from consumers. It would also have risked damaging its brand perceptions in the long-term, whereas its charitable actions are a way for it to now receive good publicity, after months of being condemned for its slow reaction following Kanye West’s offensive remarks.”