After the “Xinjiang cotton” fiasco, the internationally renowned sports brand Adidas released its financial report on May 7, showing that sales in China increased by 156% in the first three months of this year, and said that the second quarter results will also show significant growth.
The picture shows an Adidas brand mall in Beijing on April 19, 2020
Adidas said in its report that net income in the first quarter of this year was €502 million (about $605 million), higher than in 2020, CNBC reported on May 7.
Adidas said it expects sales growth in the second quarter to continue in the first quarter after a 156 percent increase in sales in the mainland market, with the statement saying “this acceleration will be driven by a series of innovative product launches.
Adidas CEO Kasper Rorsted told CNBC that he still expects “very strong growth” in China for the full year and that “we remain very confident that we will continue to build our position in China, which is our largest single market.”
But a May 6 report from international ratings agency Morningstar showed that Adidas’ sales of sportswear and footwear on the mainland e-commerce platform Tmall fell 59 percent over the same period.
Morningstar’s report also said Tmall’s sales of sportswear and footwear fell 11 percent in April compared with the same period last year, a marked difference from the 30 percent-plus growth rate in the fourth quarter of last year, reflecting the fact that Chinese consumers appear to be simply waiting for the boycott wave to end, rather than bypassing foreign brands altogether. The report estimates that Chinese consumers’ current shopping behavior is “likely to be temporary,” and with no recent moves by the Communist Party’s official media, the boycott is expected to fade in the coming months.
In March, the Communist Youth League publicly rehashed an old statement issued by H&M last year to stop using Xinjiang cotton, which subsequently set off a new wave of boycotts on mainland China’s Internet, involving international brands such as Nike and Adidas.
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