Adidas to raise prices as US tariffs costs rise by €200m

The company announces its Q2 results tomorrow and expects the tariffs to eat into its profits

US sanctions on imported goods from the European Union, which include footwear, textiles, and clothing, could cost the German sportswear company Adidas up to €200m in profits for the current fiscal year. In anticipation, the company announces it will increase prices in North America starting in August.

Shareholders to be informed

Chief Executive Kasper Rorsted revealed the information in an interview with the Financial Times, although he assured shareholders that the company's overall performance was still on track.

The company plans to inform investors about the price increases alongside its Q2 results announcement tomorrow. Adidas's Q1 results, which covered the majority of the initial stages of the pandemic, were remarkably strong, with revenue up by 5% and operating profit up by 11%.

EU and US trade tensions

The announcement comes in the midst of heightened trade tensions between the EU and US, with US President Trump threatening additional tariffs on EU goods including whiskey, wine, and motorcycles. The news also follows a difficult period for Adidas, which faced allegations of modern slavery in its Chinese factories last month and widespread retailer bankruptcies during the pandemic.