Adidas, the renowned sporting goods company, has adjusted its previous full-year profit target due to a slower recovery in China following the COVID-19 pandemic restrictions. The company now expects its net income from continuing operations for 2022 to reach approximately 1.3 billion euros ($1.31 billion), which is significantly lower than its initial prediction of between 1.8 billion and 1.9 billion euros. The decline in revenues in the Greater China region, projected to be in the double digits for the rest of the year, is primarily caused by the ongoing COVID-19 related restrictions. Moreover, Adidas’ efforts to clear excess inventories in the Chinese market will also negatively impact margins. In addition, the company foresees a potential slowdown in consumer spending during the second half of the year in other markets due to challenging macroeconomic conditions.

Despite these challenges, there is a silver lining for Adidas as they reported a 10% increase in second-quarter sales, amounting to 5.6 billion euros. This growth is mainly attributed to the North American and Latin American markets, which have shown resilience during this period. However, the company’s second-quarter net income from continuing operations fell to 360 million euros compared to 387 million euros in the previous year, primarily due to lower margins.

Overall, Adidas is currently facing obstacles not only in China but also in other markets due to the ongoing pandemic and macroeconomic conditions. The company will need to carefully navigate through these challenges in order to meet its revised profit targets for the full year.

For more information on Adidas’ financial performance, you can visit their official investor relations page here. Additionally, to understand more about the impact of the COVID-19 pandemic on the sporting goods industry, you can explore this insightful article here.