Despite finishing 2024 on a high note, Adidas is set to undergo layoffs at its Herzogenaurach, Germany, headquarters.
In a statement sent to WWD’s sister publication FN on Thursday, an Adidas representative noted that the job cuts are not part of a cost savings program but instead are aimed at “reducing complexity and ensure sustainable success in the future.”
“Over the past two years we have created strong momentum for the business, our brand and our products and have proven that our approach to serve our consumers works,” the representative said. “But we also found that, in an ever-changing world, we are too complex because of our current operating model. To set Adidas up for long-term success we are now starting to look at how we align our operating model with the reality of how we work. This may have an impact on the organizational structure and number of roles based at our HQ in Herzogenaurach.”
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Adidas declined to confirm any figures or further details at this time as the company is just starting to evaluate its organization and determine what structural changes are needed. But, according to a Reuters report, the layoffs are estimated at up to 500 jobs at the German headquarters that employ around 5,800 people in the town.
The spokesperson added that Adidas is working closely with its works council to ensure that any changes are handled with the utmost respect and care of all employees.
Adidas’ proposed job cuts comes on the same day that its rival Puma announced a new cost savings plan. Dubbed “nextlevel,” Puma chief executive officer Arne Freundt described the initiative as a comprehensive efficiency program targeting cost optimization and operational improvements.
Earlier this week, Adidas reported stellar preliminary results for the fourth quarter and fiscal 2024.
Adidas saw revenues grow 24 percent in the fourth quarter to 5.97 billion euros, up from 4.81 billion euros the same time last year. As for the full fiscal year, Adidas said revenues increased 11 percent in 2024 to 23.68 billion euros, compared to 21.43 billion euros in fiscal 2023.