German law enforcement officials have executed a search operation at the headquarters of sports apparel brand adidas in Herzogenaurach.
The action is part of a tax investigation that has been ongoing for several years, as confirmed by a company spokesperson to Bloomberg. The search operation was initially reported by German monthly publication Manager Magazine.
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adidas has acknowledged the situation, revealing that it has engaged with customs officials over an extended period, furnishing them with the necessary documentation and information required for their inquiry.
The company has reassured stakeholders that it has complied with requests for information pertinent to the investigation.
According to CNBC, the scope of the investigation spans from October 2019 to August 2024 and examines adherence to customs and tax regulations concerning product imports into Germany.
adidas emphasises its cooperative stance with the relevant authorities.
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By GlobalDataThe company also highlighted its commitment to resolving any ambiguities stemming from divergent interpretations of German and European legislation.
adidas stated: “The company does not expect a significant financial impact in connection with the investigation.”
The brand has encountered challenges in recent years, including consumer boycotts and a substantial drop in sales following the termination of its partnership with rapper Ye and the Yeezy brand, but has shown strong recovery under the leadership of CEO Bjorn Gulden.
In October 2024, the company raised its annual profit forecast for the third consecutive quarter (Q3) of fiscal 2024 (FY24), fuelled by strong demand for retro sneakers such as the Samba.
It reported a currency-neutral revenue surge of 10% in Q3 FY24, attributing this growth to a robust performance by the core brand, which saw a 14% increase.
The company is set to reengage in a trademark dispute with fashion entity Thom Browne in the UK. Legal proceedings recommenced on 17 July 2024.
