German sportswear giant Adidas elevated its profit estimates today after a jump in sales in the third quarter, but screwed down its sales forecast, blaming lower than expected growth in western Europe.
Shares fell two per cent on the news, as Adidas said full year revenues were likely to increase by only eight to nine per cent, falling short of the 10 per cent the company had anticipated.
The world's second-largest sportswear manufacturer announced a revised net profit prognosis of up to €1.72bn (£1.5bn), up from a previous estimate of €1.68bn, which would be an increase of 20 per cent compared to 2017.
Nine months into 2018, the company has chalked up profits of €1.62bn, a 19 per cent increase year-on-year, which was partially down to favourable currency effects.
Flat sales in western Europe, where shoppers now favour revived trainer models from rivals Nike and Fila, pushed revenue down one per cent in the quarter.
Globally, Adidas enjoyed revenue of €5.87bn, a growth of eight per cent. Online sales surged by a phenomenal 76 per cent. Marketing expenditures increased 11 per cent.
Adidas boss Kasper Rorsted said: "The top-line expansion was driven by double-digit increases across our strategic growth areas North America, Greater China and e-commerce. At the same time, we achieved strong profitability improvements despite a significant increase in marketing investments and severe currency headwinds. With these results, we are confident to reach a higher-than-expected profitability level in 2018 and remain firmly on track to achieve our long-term targets until 2020."