Friday Dump 🥟 - Adidas' downward trend, Bears new den, Iowa's viewing hot streak

We missed you, Friday Dump 🥟

Each Friday, we’ll breakdown 3 sports business stories that have caught our eye throughout the week. They will be assembled in the following format:

🔴 - Stories that make us stop, think, and question.

🟡 - Stories with a hint of risk and unpredictability.

🟢 - Stories that make us feel good to go and empowered.

Now get in here for a big hug.

🔴 Adidas’ garbage year. Oh Adidas. The famous three-stripes we know and love. The sportswear company who brought us the Sambas and Gazelles is now in a state of flux. On Wednesday, Adidas reported its first annual loss in more than 30 years! For the full year, revenue fell 5% to ~$23B with a net loss of $82M (in 2022, they saw a net gain of $670M) 😬. And their operating profit dropped 60% to $293M (can we open our eyes yet?!). So what’s going on?

• Within the last year, there have been issues across the sportswear industry, and it starts with demand.

  • Consumers have been feeling a bit uneasy when it comes to high inflation, lagging consumer confidence, and high interest rates.

    • This has led to competitors, such as Nike, to be affected by these trends. Nike is in the midst of cutting $2B in costs, mostly in the form of layoffs.

    • Adidas is dealing with excess inventory after the liquidation of its Yeezy line. This occurred after ending their partnership with Kanye West, in the wake of his antisemitic comments.

    • Adidas needed to unload $1.3B worth of existing Yeezy shoes. They ended up selling ~$820M worth of Yeezy product during Q2 and Q3 of 2023 — they didn’t sell anything in Q4. They’re expected to sell the remaining $270M in 2024.

    • To give you an idea, Yeezy revenue in 2022 came in ~$1.3B (yep, big loss for the three-stripes).

  • But what also makes these numbers look grim, might have to do with the record gains and high demand the industry was experiencing during the pandemic — numbers that might not be considered attainable nowadays.

🟡 Chicago Bears pulling a sike. After briefly mentioning the news as a Quick Hitter earlier this week, we decided to dive in a little deeper behind the Chicago Bears stadium “bamboozlement” (Merriam, can you check us on that word? 🤓). As an overview, according to reports, the NFL team scrapped its plans to build a new stadium in the suburbs (Arlington Heights) and now plans to stay in the city at a new domed, lakefront venue close to its current stadium, Soldier Field. Building a dome stadium in the Windy City, would not disappoint many fans, except for relinquishing their advantage of “Bear Weather”. Overall, the city, team, and NFL would be happy with a new stadium — giving them the opportunity to host premium events such as, the Super Bowl or Final Four. You’d think this wouldn’t be an issue, as Chicago is the country’s third-largest media market. But strap in Bears fans because this ride is about to get bumpy…

• Fight with the Heights. In 2023, the Bears purchased the former Arlington International Racecourse property for $197 million. But a property tax dispute ($100M higher than expected tax bill) pissed off the team so much, they moved to Plan B in downtown (no, not that Plan B, weirdo, but shout out to IL for keeping it legal 🥳).

• Pushback from the Parks. Because of this new plan, preservation group, Friends of the Parks, is having issues with this new alternative since the new stadium would be close to the lake. The group sets out to do what they can to preserve the open, clear, and free lakefront. And this wouldn’t be the first time they’ve been defiant about this land.

• Awkward payment structure. Even though the Bears are contributing over $2 billion of private money for the new development, the stadium will be considered publicly-owned (this is not normal). It might be because taxpayers still owe around $600M from the Soldier Field renovations in 2003, but we have to wonder how this would all play out financially (both for the team/ownership group and the taxpayers moving forward).

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🟢 The Lady Hawkeyes just keep breaking records. Last Sunday, Caitlin Clark led Iowa to a come-from-behind win against the Nebraska Cornhuskers for the Big Ten championship. The final averaged 3.02 million viewers on CBS, making it the most-watched women’s basketball game on CBS since 1999. The game now is the second-most watched women’s college basketball game this season behind Iowa-Ohio State on Fox, which drew 3.4 million viewers. It is the third most-watched regular-season women’s college basketball game since 1999 👏. How does it compare with other games? Well, I’m glad you asked…

• ESPN drew 1.96 million viewers for the SEC Championship of South Carolina vs. LSU. They also drew 1.44 million viewers for USC’s win over Stanford.

  • Sports Media Watch said it was the largest women’s regular-season audience on ESPN since 2010.

• What’s interesting is that on the mens side of Duke vs. North Carolina (yes, one of the most iconic rivalries in all of sports), that drew 3.07 million viewers on ESPN — and it was on a Saturday night!

  • It just so happens, per Sports Media Watch, the Iowa-Nebraska women’s game ranks 5th among all college basketball games — regardless of gender.