Moody’s cuts Adidas credit rating to A3 after profit warning

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Reuters API

Moody’sAdidas

Adidas warned on Feb. 9 that it could plunge to a loss this year for the first time in three decades, in the latest downgrade triggered by its split from Kanye WestYeezy

Moody’s said that even though it had expected a weak operating performance from Adidas in the next 12 to 18 months, its actual guidance was “well below Moody’s expectations.”

While it described the company’s new outlook as conservative and noted its leading position in the global sportswear industry and strong brand, Moody’s said its negative outlook reflected “the substantial uncertainty around the near-term improvements of adidas’ credit metrics and liquidity profile following the release of a very weak earnings guidance for 2023.”