By Andrea Figueras

Adidas reiterated its expectations for the year, but warned that Trump's tariffs could weigh on performance, which might prompt price increases in the U.S. to mitigate the hit.

The German sporting-goods company said Tuesday that it continues to anticipate currency-neutral sales growth at a high-single-digit rate. It also forecasts an increase in operating profit to between 1.7 billion and 1.8 billion euros ($1.94 billion-$2.06 billion).

"While the company confirms its outlook, the range of possible outcomes has increased," it said. President Trump recently unveiled tariffs on imported goods from major sourcing hubs for footwear and apparel, including China, Vietnam and Cambodia, among other Asian countries. The levies were later suspended for 90 days, though tariffs on some products remain in place.

The company has already minimized exports from China to the U.S. and has rerouted some products, meaning that those produced in China that were meant for the latter country are going to other markets or staying within Chinese borders. China remains an important sourcing partner for the group, both for the local market but also for other regions that aren't the U.S., Chief Executive Bjorn Gulden said during a call after results.

Despite these efforts, Adidas is still exposed to levies, as it can't produce almost any of its products in the U.S.

The group has examined where price increases in the U.S. market would be possible, but said that they haven't been raised yet. "We will see what the market is doing and then not be the first mover," the CEO said. There are no plans to raise prices in other markets outside the U.S., he added.

The CEO said the group can compensate a potential hit from levies with a positive performance in other markets, but noted that the uncertain outcome of tariffs makes it hard to plan ahead.

Since Gulden joined Adidas in 2023, the company has lifted its full-year outlook on several occasions, as part of its strategy to beat and raise expectations.

"With this strong quarter, the strong order book and in general a very positive attitude towards Adidas, we would have increased our outlook for the full year both for revenues and operating profit. The uncertainty regarding the U.S. tariffs has currently put a stop to this," the CEO said.

Although tariffs will be a headache for many brands, some players appear to be facing additional difficulties. U.S. sportswear giant Nike is going through a turnaround plan, led by Chief Executive Elliott Hill, while German rival Puma parted ways with CEO Arne Freundt due to differing views with the company's supervisory board on strategy execution.

Adidas confirmed pre-released first-quarter figures, with sales of 6.15 billion euros, 13% higher than in the prior-year period in currency-neutral terms. Operating profit rose to 610 million euros for the quarter, up from 336 million euros previously, with a margin of 9.9%.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

April 29, 2025 07:29 ET (11:29 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.