Adidas Pushes Decision-Making Closer to Stores as Earnings Recovery Gains Traction

Adidas accelerates structural overhaul to empower regional teams, posts 14% revenue growth in Q1, raises dividend, and eyes 2026 World Cup for US market resurgence despite tariff headwinds.

The gap between Adidas's improving operational performance and its languishing share price has seldom been wider. While the stock continues to trade near the bottom of its 12-month range, the German sportswear giant is quietly accelerating a structural overhaul designed to make it more responsive to shifting consumer tastes in its most important markets.

Under CEO Bjørn Gulden, the company is shifting significant authority away from its Herzogenaurach headquarters and into the hands of regional teams. Markets such as China, Japan and the United States will now have more say over product prioritisation and marketing campaigns, a move aimed at cutting the time it takes to react to local trends. "It's a balancing act," Gulden has noted internally — faster moves on the ground must not come at the expense of operational stability.

The logic is straightforward: in China and the US, consumer preferences can pivot quickly, local rivals often act more aggressively, and geopolitical tensions complicate long-term planning. By shortening the chain of command, Adidas hopes to tailor its assortments and promotional strategies more precisely to each region. The restructuring is about more than internal reorganisation — it is an attempt to bring the brand closer to customers in the markets that matter most for growth.

World Cup 2026: a North American opportunity

That push into the US will receive a major boost from the 2026 FIFA World Cup, to be hosted by the United States, Canada and Mexico. Adidas is an official partner, will supply the match ball and kit out several national teams. The tournament arrives at a critical moment, offering a chance to regain visibility against Nike in a market where Adidas has long played catch-up. If product demand, team presence and marketing align, the event could generate meaningful tailwinds.

Q1 numbers show a business on the mend

The financial foundation for both the restructuring and the World Cup push is improving. In the first quarter, currency-adjusted revenue jumped 14% to roughly €6.6 billion, a clear sign that demand is picking up. Earnings per share rose to €2.72 from €2.40 a year earlier, while operating profit climbed 16% to €705 million. The operating margin reached 10.7%, giving Adidas more room to invest in marketing, product cycles and capital returns.

Management has set a full-year operating profit target of around €2.3 billion. That forecast already accounts for roughly €400 million in headwinds from US tariffs and unfavourable currency movements. While those burdens temper some of the gloss, they also make the guidance more resilient.

Capital returns rise alongside the share price discount

Shareholders are seeing increased rewards. For the 2025 financial year, the dividend was raised to €2.80 per share from €2.00. Analysts pencil in €3.63 for 2026, though that remains a forecast rather than a confirmed payout. Additionally, Adidas has launched a share buyback programme of up to €1 billion for 2026.

Despite these positive signals, the stock is stuck in a holding pattern. At Friday's close of €145.55, the shares have lost 13.6% year-to-date and 33.7% over the past twelve months — a reflection of persistent scepticism among investors.

Technical picture: stabilisation, not a turnaround

The chart tells a story of short-term relief but long-term caution. The stock has climbed above its 50-day moving average of around €140, a gap of roughly 3.9%. But it remains well below the 200-day line near €160, a deficit of about 8.8%. The relative strength index stands at 72.2, suggesting the recent bounce may be overstretched.

The 52-week high of €220.90 is a distant memory, though the shares have rallied 11.75% from the year's low of €130.60. Analysts see further upside, with a consensus price target of €202.67 and full-year earnings estimates of about €9.49 per share.

What comes next

The next major catalyst arrives on 30 July, when Adidas reports its second-quarter results in detail. Investors will be watching for evidence that the new regional structure is already translating into faster product and marketing decisions, particularly in the US and China. The World Cup in 2026 remains the bigger test, but for now the focus is on how quickly the operational recovery can narrow the gap with a stock that has yet to fully price in the turnaround.