After ending its partnership with Kanye West, aka Ye, adidas is planning to continue selling merchandise from its Yeezy portfolio sans the Yeezy branding.
The German sportswear giant is the sole owner of all adidas-Yeezy product designs as well as previous and new colorways developed under the partnership.
According to analysts at Morgan Stanley and RBC Capital Markets, adidas plans to start selling its products under the adidas brand at the beginning of 2023.
“Looking ahead, on our understanding, the company will not sell any Yeezy-branded products and all Yeezy products will be branded under adidas brand,” said Morgan Stanley analyst Edouard Aubin in a note to clients Tuesday.
The company is reportedly focusing on the potential upside of dissolving its partnership now as there are fewer expenses.
The decision to leverage its own branding after ending its partnership with Ye follows the pressure the company has been under from investors over its current struggle with excess inventory and a slowdown in business in China.
The company’s original deal with Ye, however, acted as a stable and significant source of revenue.
Due to the breakup, adidas expects to absorb a $247 million hit to earnings.