Adidas Shrugs Off Headwinds as Bond Issue and World Cup Orders Power a Comeback

Adidas has found its footing again. The German sportswear group completed a €500 million bond placement on 19 May, bolstering its financial firepower just as the countdown to the 2026 World Cup enters its final weeks. The dual catalyst has lifted the stock from the depths of April's sell-off and put the company on a firmer technical footing.

After hitting a low of €130.60 on 7 April, the shares have rallied sharply. In late May, the stock closed at €166.90, breaking above its 200-day moving average for the first time since March 2025. By the most recent Friday, it had edged higher to €167.10, marking a 7.25% weekly gain. Technical indicators such as RSI and MACD flashed divergence signals during the decline, a pattern that often heralds a bottom.

Fresh Financing, Strong Underlying Demand

The €500 million bond, placed on 19 May, adds financial flexibility as Adidas executes its strategic overhaul. The company is shifting from a traditional wholesale model toward a direct-to-consumer (DTC) business. In the first quarter, global DTC sales rose 22%, with e-commerce up 25% and own retail up 19%. The transformation is designed to improve margins and reduce dependency on retail cycles.

That structural move is reinforced by powerful short-term tailwinds. The World Cup is less than two weeks away, and Adidas is outfitting 14 of the 32 participating teams – including defending champion Argentina, co-host Mexico and title contender Spain. Nike trails with 12 teams. Adidas football chief Sam Handy told the Handelsblatt that the direct World Cup effect on sales will exceed €1 billion. Kits are already selling ahead of internal forecasts.

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The tournament carries extra significance: the 2026 World Cup jerseys will be the last for the German national team under Adidas. Nike takes over the kit contract from 2027.

Q1 Beat Sets the Stage

The rally is built on solid first-quarter numbers that handily beat expectations. Currency-adjusted sales jumped 14%, pushing reported revenue from €6.153 billion to €6.592 billion. Operating profit rose 16% to €705 million, lifting the margin to 10.7%. Net income from continuing operations increased 11% to €484 million.

The performance segment, which includes football, running and training, surged 29% on a currency-neutral basis. The 2026 away kit launched in March and generated roughly €250 million in World Cup-related orders in the first quarter alone. A similar volume is expected in the current period.

Headwinds Remain but Are Priced In

Not everything is rosy. Adidas expects a currency-neutral sales increase in the high single digits for the full year, with operating profit of around €2.3 billion. That guidance is weighed down by US tariffs and currency effects totalling roughly €400 million. The strong euro already cost the company about €350 million in translation effects in the first quarter, dragging reported growth by more than six percentage points.

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Cash and equivalents fell 39% to €873 million as of 31 March, reflecting working capital investments and a share buyback program of up to €1 billion. The bond issue helps replenish that liquidity for the turnaround.

What Comes Next

Near-term support for the stock sits around €140, a level that must hold if the recovery is to extend. The big test arrives in June when World Cup kit sales and marketing campaigns provide a live read on demand. The next quarterly report, due on 30 July, will show whether the billion-euro forecast is on track. For now, Adidas has turned a corner – but the full trend change still needs to be proven in the heat of tournament season.

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