Adidas Starts Unloading Its Yeezy Gear, to Benefit Anti-Hate Groups

Why It Matters: Adidas is trying to resolve a public relations problem.

The postings on Adidas’s website of Yeezy Boost 350 V2 sneakers, in black and two-toned red and gray, selling for 200 euros a pair, or about $213, generated buzz over social media, reflecting the enduring popularity of the brand. The shoes go on sale Thursday.

Adidas said its decision to sever ties with Ye cost the company €1.2 billion in lost sales and about €500 million in profit this year.

Options for eliminating the inventory ranged from burning it to donating it to the needy. Mr. Gulden called figuring out what to do with the remaining stock “one of the most difficult decisions that I have been a part of.”

But Yeezy shoes have been known to sell for up to $1,000 a pair and remain popular despite their association with Ye. So the company said it had made the decision in consultation with groups including Black Lives Matter and the Philonise & Keeta Floyd Institute for Social Change, which is run by Philonise Floyd, the brother of George Floyd.

Jonathan A. Greenblatt, chief executive of the Anti-Defamation League, which is among the groups that will benefit from the proceeds of the sale, welcomed Adidas’s decision as one fitting the complexity of the problem.

“This is a thoughtful and caring resolution for the unsold merchandise,” Mr. Greenblatt said.

But other groups noted that despite Adidas’s pledge to donate the proceeds, Ye would still make money off the sales. Adidas has declined to comment on how much that would be, but Mr. Gulden previously said Ye still had a royalty contract that Adidas was obligated to honor.

“Adidas’s willingness to donate the proceeds is highly commendable,” said Josef Schuster, president of the Central Council of Jews in Germany, but he added, “The fact that Kanye West would profit financially from the sale is highly problematic.”

Background: The end of a hugely lucrative partnership.

The Yeezy brand became a defining force in the sportswear industry and an incredibly lucrative cornerstone for Adidas. The partnership between the rapper and the company, based in Germany, was hailed as the most successful sportswear collaboration since Michael Jordan teamed up with Nike.

But last fall, Ye’s erratic behavior and comments targeting Blacks, Jews and others caused an uproar. Adidas came under pressure for failing to react, after other brands severed ties with the artist.

What’s Next: More Yeezy styles may go up for sale.

Besides the two styles posted for sale, the website shows images of a dozen other models, suggesting that more could be announced in the coming weeks.

Adidas said it was considering further releases of the Yeezy inventory, but it did not give a timeline. Customers were asked to download an app and register for updates.