Adidas has announced that it will raise prices for customers in the United States due to new tariffs that are expected to add up to €200 million in extra costs for the rest of the year.
The German sportswear company, known for its popular Gazelle and Samba trainers, is facing higher expenses as the US imposes new import duties on goods from key Asian manufacturing hubs.
Currently, almost half of Adidas products are manufactured in Vietnam and Indonesia.
Vietnam accounts for 27% of production, while Indonesia contributes 19%.
Both countries recently reached trade agreements with the United States, which include tariffs of 20% and 19% respectively on goods exported to the US.
These tariffs are applied to US companies that import and sell Adidas products.
Adidas has stated that it is not able to shift most of its production to the US, making the company more vulnerable to these rising costs.
The exact effect on US consumer demand remains uncertain, especially if the tariffs lead to broader inflation.
The company is not alone in this challenge. Rival sportswear brand Nike also said in May that it would increase prices in the US and estimated that tariffs could raise its expenses by around $1 billion.
Despite the pressure from tariffs, Adidas reported strong financial performance in the first half of the year.
Sales grew by 7.3% to €12.1 billion, and pre-tax profit rose from €549 million to €1 billion.
In the second quarter, footwear sales climbed by 9%, and clothing revenue rose by 17%.
Still, the company warns that the added costs from US trade measures will weigh heavily on operations through the rest of the year, and it remains to be seen how American shoppers will respond to the price increases.