Adidas AG benefited from double-digit growth in China in the first quarter ending March 31, compensating for slower sales in Europe and North America. Globally, ecommerce revenue increased 40% year over year. Adidas is No. 36 in the Internet Retailer 2019 Top 1000.
Online sales were up around the world for Adidas, with each region showing double-digit growth. The shoe brand also launched its app in new regions, making it available in 27 countries total. It had more than 9 million downloads by the end of the quarter.
However, total revenue rose just 4.0% to 5.88 billion euro ($6.57 billion). Beset by shrinking sales at home and supply-chain problems flaring up in North America, Adidas’s recent successful track record appeared to be in danger. In the meantime, Adidas is getting a boost from sales growth of 16% in Greater China. That eased the pain of business in Europe, where revenue fell 3%, and North America—where Adidas stole market share from rival Nike Inc. (No. 34) in recent years—which ticked up just 3%.
In other earnings news:
- Sports apparel brand Under Armour Inc. (No. 100) posted declining revenue from its direct-to-consumer business, which includes online sales. The 6% direct-to-consumer drop to $331 million for the first quarter ending March 31 comes amid a three-year transformation is getting the athletic brand back on track. Under Armour points to fewer online discounts as the reason for decreased ecommerce sales, although the brand didn’t break out exact digital revenue. The slow direct-to-consumer sales growth was intentional, part of a dramatic shift in Under Armour’s business over the past two years to not discount its merchandise so frequently, according to the filing. The brand wrote off a large chunk of inventory that will not generate a profit, reworked its supply chain and eliminated about 40% of its products to focus on its highest-selling lines.
- Mall owner Simon Property Group said in its first-quarter earnings call that retail store closures are slowing. “I think most of the bad news is behind us,” CEO David Simon said on a call transcribed by Seeking Alpha. “But I can’t guarantee that.”
- Brazilian ecommerce marketplace MercadoLibre, No. 8 in the ranking of Internet Retailer Online Marketplaces, processed $5.6 billion in payments during the first quarter ending March 31, a 35.1% increase over the same period last year. Gross merchandise value, the total cost of products sold through the marketplace, hit $3.1 billion, up 1.7% year over year. MercadoLibre also increased revenue outside of its ecommerce platform with its mobile point-of-sale, mobile wallet and merchant services, together up 118.8% year over year.
- Ecommerce platform provider Shopify posted a 50% increase in revenue to $320.5 million for the first quarter ending March 31. Revenue from its subscription service, which gives retailers using the ecommerce platform tools to implement recurring orders, grew 40% to $140.5 million, driven by an increase in merchants participating in the program. Shopify is the No. 5 ecommerce platform provider in the Leading Vendors to the Top 1000.
Bloomberg contributed to this report.
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