• Adidas warns of €200 million impact from U.S. tariffs in the second half of the year.
• CEO Bjorn Gulden indicates uncertainty regarding consumer demand amid potential price hikes.
• Net sales for Q2 rose 2.2%, but results missed analysts' expectations.
• The company foresees price increases on products sold in the U.S. due to tariffs.
• Adidas's operating profit exceeded estimates but stock shares dipped 7% post-announcement.

Adidas has announced that **higher U.S. tariffs will add approximately €200 million ($231 million)** to its costs in the second half of the year, following a double-digit million euro impact already felt in the second quarter. CEO Bjorn Gulden stated that this situation stems from the uncertainty of tariff levels and the indirect effect on consumer demand which might risk major inflation during this period, potentially disrupting sales and profitability. This warning accompanies the sportswear brand's ongoing evaluations of pricing adjustments in the U.S. market, as indicated by multiple sources including Reuters and BBC.

In terms of performance, Adidas reported a **2.2% increase in net sales** for the second quarter, amounting to €5.95 billion, which fell short of analysts' expectations of €6.2 billion. The sales boost was impacted by currency fluctuations costing the company around **€300 million**, placing additional pressure on operational forecasts. Despite this, their operating profit for the quarter was a favorable **€546 million**, surpassing analysts' estimates of €520 million, which demonstrates some resilience in product pricing strategies, according to reports from Reuters and Reuters.

Adidas highlights that its largest sourcing countries, **Vietnam and Indonesia**, are impacted by new U.S. trade agreements, which imposed a **20% tariff** on Vietnamese goods and a **19% tariff** on those from Indonesia. Collectively, these countries account for over 46% of the products sold by Adidas in the U.S. This situation has compelled the company to frontload inventory shipments to mitigate tariff impacts, ultimately resulting in a **16% increase in inventories** to €5.26 billion as of the end of June, as reported by Reuters and Business Insider.

Moving forward, Adidas' leadership is cautiously optimistic, maintaining its annual guidance for operating profits while facing the burden of these new tariffs and inflation concerns in consumer markets. "We want to grow and we are also willing to over-invest in the U.S. to double the business," stated Gulden, though stock has seen a drop of 11% following the tariff announcements, indicating investor concern over the company's future trajectory amidst these challenges, highlighted in reports by Reuters and Reuters.