The Daily - What Adidas Knew About Kanye

Episode Date: November 10, 2023

Warning: this episode contains some explicit language.When Adidas terminated its multibillion-dollar partnership with Kanye West over his antisemitic and other offensive public remarks, it seemed like a straightforward story of a celebrity’s suddenly imploding. But a New York Times examination has found that, behind the scenes, the collaboration was fraught from the start.Megan Twohey, an investigative reporter for The Times, talks about what she discovered when she delved into the meltdown.Guest: Megan Twohey, an investigative reporter for The New York Times.Background reading: The investigation into Kanye and Adidas: a story of money, misconduct and the price of appeasement.Inside the uneasy relationship: Here are seven takeaways.For more information on today’s episode, visit nytimes.com/thedaily. Transcripts of each episode will be made available by the next workday.

From The New York Times, I'm Michael Barbaro. This is The Daily. Today, when Adidas terminated its multi-billion dollar partnership with Kanye West over his anti-Semitic remarks, it seemed from the outside like a straightforward story of a celebrity suddenly imploding. My colleague, investigative reporter Megan Toohey, got inside the partnership and found that the reality was far more complicated. It's Friday, November 10th.

Megan, I want to start with a very simple question. Why have you and why have we, The Times, spent all this time investigating Kanye West and his relationship with Adidas? Well, Michael, if you'll recall, it was almost exactly one year ago that Adidas cut ties with Adidas. Well, Michael, if you'll recall, it was almost exactly one year ago that Adidas cut ties with Kanye West as he was in the midst of making anti-Semitic and other public inflammatory comments. As he basically melted down. It was like he was having a public implosion

and this company said, we're no longer doing business with him. We don't tolerate this kind of behavior. This goes against our ethics. So we're ending this relationship. Right. And end of story? To some extent, yes. But while the end of this story had played out in public, there was a lot we didn't know about the beginning of the relationship and about the middle of the relationship. This collaboration was,

by and large, a total black box for, you know, years and years. There was a lot that we didn't know about the financial details of the collaboration. And we also didn't know to what extent the behavior we saw from Kanye West last fall was either kind of an unusual blip or actually part of a pattern of behavior that had played out inside this partnership. So as you often do, you're investigating people with a lot of power and a lot of money to see what's really going on inside this relationship. So how do you go about doing this reporting? How do you go about doing this reporting? So I traveled to Portland, Oregon, the U.S. headquarters of Adidas, and to California, where Kanye West has lived and largely operated out of for many years.

And I ended up interviewing current and former employees of Adidas and of Kanye West, who now goes by Ye, and other people who were in the orbit of this collaboration. And I also was able to obtain hundreds of internal records, previously undisclosed documents. That included text messages, internal text messages among top Adidas executives as they were scrambling to respond to this, contracts, company memos, and other financial records. Every stone imaginable, it sounds like. And what did you find? And where should we start in talking about those findings? So my reporting goes all the way back to the very beginning of this partnership in 2013. And what's important to know is that Adidas was feeling quite stalled at that time.

It was in the hyper-competitive market of sneakers and had fallen way behind Nike. Nike had, in the 1980s, done a deal with Michael Jordan, who was then an up-and-coming basketball player, and had basically blown the competition away ever since. So come 2013, Nike has 50% of the U.S. athletic shoe market compared to Adidas, which has just 8%. Wow. So a true also-ran. Exactly. And they are desperately looking for ways to start catching up. And so enter Kanye West. And the Grammy goes to the college dropout, Kanye West. Everybody wants to know what I would do if I didn't win. I guess we'll never know.

One of the most popular musicians of all time. For a long time, people were telling me, man, if you go out to New York, you could really kill the game out there. You know, he had started his career producing music for other musicians before becoming a complete rap star in his own right. When someone comes up and says something like, I am a god, everybody says, who does he think he is? I just told you who I thought I was, a god. That's who I think I am. That year, he had come out with yet another album, Yeezus, which was, you know, topping the charts. And beyond that, he had just become this incredible cultural force. Kim and Kanye got engaged, everybody.

He was engaged to Kim Kardashian, who was the star of reality television and soon to be of social media. They are in the news a lot. I think they're in the news more than the news. So he was seen as somebody whose power and influence and celebrity stretched beyond the music that he made. You don't realize I am so frustrated. Like, I am so frustrated. But for all of his success in music, Kanye wanted more. I've got so much I want to give. I've got ideas on color palettes.

I've got ideas on silhouettes. He had this burning desire for more creativity, for more power, for more influence. At this time, a lot of it was channeled into a burning ambition to break into fashion. I eventually want to be the anchor of the first trillion dollar company. But he kept hearing that the best he could hope for was to put his name on other people's products. So he, in many ways, needs Adidas almost as much as Adidas needs him. And so Adidas looks at Kanye, and Kanye looks at Adidas,

and they see an opportunity to serve each other's interests. Right, solve each other's problems in that moment. Exactly. Okay, so what happens? So Adidas offers Kanye the most generous contract it has offered a non-athlete ever. It's a contract that can stretch into 2017. He is going to be a genuine co-creator of both shoes and apparel. He will collect a 15% royalty on net sales of whatever they make. And he will get at least $3 million a year guaranteed. A good deal.

A good deal. A good deal. And no sooner had they signed, Kanye sends a text message to one of the Adidas executives who helped execute the deal saying, the world changes now, with three exclamation points. So Adidas is clearly making a very meaningful bet on Kanye. Do they have any reservations? No. worked so closely in this collaboration is that they knew that Kanye was coming into this contract with a history of being dramatic and controversial and provocative. I mean, if you'll recall, after Hurricane Katrina, he famously said on TV that President George W. Bush didn't care about

Black people, which had caused some controversy. And he was also known for jumping up on stage to protest Taylor Swift winning an MTV award, which got a ton of attention. And so Adidas is saying, listen, maybe that provocative streak will actually work in our favor, that it's going to help benefit whatever products we make together. actually work in our favor, that it's going to help benefit whatever products we make together. Right, because after all, we're in an era of celebrity where bad news and good news gets kind of ambiguous. It's all good attention. Right, attention is attention and can help drive sales. But almost as soon as they get into business together, Adidas is glimpsing behavior behind the scenes that could be potentially much more problematic. Like what?

Well, I mean, shortly after signing the contract, Kanye West is hosting Adidas executives and other employees at his apartment here in New York. And in the middle of the meeting, he forces them to watch pornography, ostensibly to spark creativity. It's a very unusual introduction to the company. Yes. And I discovered something else startling that happened just a couple weeks later. Kanye was in Germany, the headquarters of Adidas, and they're rolling out the red carpet for him. They're so excited about this budding partnership. And they've assembled shoes and a mood board pinned with inspiration and sketches of designs of what the first shoe could potentially look like.

And none of the designs look like what Kanye had tried to convey that he wanted. And to emphasize his frustration, he takes a marker to the toe of a shoe design and he draws a swastika. He draws an actual swastika on the shoe? He draws an actual swastika on the sketch of this shoe. What is the reaction in the room? Well, it was shocking, especially for Germans in the group, where it is illegal in many cases to draw or otherwise present swastikas. And this is also especially sensitive for this particular company. The founder of Adidas, like many other businessmen from his time,

belonged to the Nazi party. And they were actually just miles from Nuremberg, where, you know, members of the Third Reich were tried for crimes against humanity. So what comes of this really shocking behavior? Well, in that case, an American manager who was part of that gathering kind of assured his German colleagues who were expressing concern that Kanye West didn't understand that what he was doing was illegal

and that he was really just voicing his frustration. But, you know, whether it's the meeting in which the porn was shown or this meeting in which Kanye drew the swastika, there are little glimpses, these kind of red flags that are going up. And some people see them and some people don't. I think overall, there is an attitude that that's just the price of doing business with a creative genius. So in spite of these early red flags, things proceed. Yeah, absolutely. They just jump into the work together. And listen, the Adidas employees learn that Kanye West operates unlike anybody else they've ever worked with. He is brimming with

ideas and can be enthusiastic to the point of chaos. And those people who work with him say he was also so obsessed with detail that it could be hard to get anything done. But eventually, by the beginning of 2015, they have finalized the first Yeezy sneakers. Among them, the Yeezy Boost 350. And it's this sleek sneaker that was inspired by Nike's Roshi Run, which was the shoe that had come out at the time. It was nicknamed, actually, the Roshi Killer inside Adidas. And it had, like, a flat front, not the standard kind of rolled toe that you see on a lot of running shoes. It was covered with this patterned fabric. And, you know, it wasn't well-suited for running or sports, but it went perfectly with the kind of athleisure fashion that was coming into style. As artists in this world, we can do whatever we want.

And the plan is to debut this first season of Yeezy at New York Fashion Week. And the moment finally arrives. The models come out in all this apparel and these new shoes. You know, Kanye's in the front of the group in a very sort of just a black hooded sweatshirt and black pants. And on his feet are one of the new pairs of Yeezys. and the front row is packed with like a who's who of the most famous in the world can i just ask what you thought of the show i thought it was beautiful very innovative i love there's beyonce jay-z there's rihanna there's a cluster of kardashians Kardashians. It's exactly what Adidas and Kanye had hoped for. I'm not even focused on problems. That's how I change them. We just focus on beauty, fabric, proportion,

and trying to get the price where the kids can get a hold of it. Get a hold of it. And then, you know, released in limited runs over the next few months, the shoes sold out in hours, like crashed servers. We want to see the shoes. Drum roll, please. They hooked sneakerheads, fashionistas. They look good with shorts. They look good with jeans. They look good with those pants with the zip wraps. And even sports figures who had endorsement deals with rival companies. Are buying these.

Yeah, it was tremendously, tremendously successful. So this Kanye West Adidas deal is working out very nicely. deal is working out very nicely. I'm curious, Megan, did your reporting uncover any other additional troubling behaviors by Kanye West within this collaboration he was having with the company? Yes. My reporting found that, in fact, this was a very tumultuous time inside this partnership behind the scenes. Kanye West actually in preparing as they were running up against the deadline for the launch of Yeezy season one at New York Fashion Week erupted in anger at the staff and used extremely sexually explicit offensive language. And it was so bad that several members of the team actually complained to higher ups at Adidas about it. And those type of explosions in anger would prove to be quite common.

But none of this behavior and not even the complaints slows things down. The attention quickly shifts back to the success of these sneakers. In fact, each year, everybody in the industry gathers for what is known as basically the shoe Oscars. And that year... We're honored to present him the 2015 Footwear News Shoe of the Year Award for the Adidas Yeezy Boots. The 350 won Shoe of the Year, basically the Oscar for best new shoe. Why would she make calls out? And a beaming Kanye takes to the stage with three Adidas executives behind him.

So it's cool to be up here with the three people that I've screamed at the most in the past year. And it's actually kind of telling because the first thing that Kanye says is, it's nice to be up here with three of the people that I've yelled at the most in the last year. But, you know, his tone shifting, he later says quite seriously, there was one executive, John Wexler, who had helped make the deal happen. I have to point out, because then I have to talk about how John basically saved my life. John Wexler, this guy. And Kanye says in what appears to be like a very serious tone,

you know, John basically saved my life. They allowed me to be me. They allowed me to express myself. But it's very serious. We're here to make an amazing product that we love that also sells, that makes money. So on a personal level, this is very meaningful to Kanye. This person who, as you said earlier, had wanted so very much to be taken seriously

in the fashion world. Yeah, absolutely. And the success is also very meaningful to Adidas. I mean, they've been in business now for less than two years, and already the company is thinking, how can we take this deal even farther? How can we go all in on Kanye West? We'll be right back.

So what does going all in with Kanye West look like for Adidas? So what does going all in with Kanye West look like for Adidas? So it means we're now in 2016, and even though the first contract is not up for renewal yet, they're pouncing on the chance to do a new contract, a new deal. To make it even longer. To make it longer, to set themselves up to make even more money. But significantly, this time around, the company wants to insert a mechanism into the deal that's going to allow the company to protect itself. Right. Adidas has seen some very problematic behavior behind the scenes, certainly enough

to make them want to protect themselves. So what are they discussing exactly? How are they envisioning doing that? So Adidas is pushing for something known as a morals clause to go into the contract that would basically outline the situations under which it could terminate the deal with Kanye. Basically spelling out certain behaviors, certain lines that if Kanye crosses them, it can have the legal right to say, okay, this deal is over. Right, the kind of moral boundaries under which things would end. Yes. And talking to people, executives who have worked at big companies that do these kind of deals, they have stressed that they're really important because, you know, yes, the company

has to serve its bottom line and enter into deals that are going to be lucrative, but it also has to protect its reputation. And if it's getting into business with somebody who has problematic behavior, especially perspectives or attitudes that could be easily discoverable, then the company runs the risk of looking complicit when that all spills into public view. Right. Basically, whether or not it's explicit, endorsing it. Right. Basically, whether or not it's explicit, endorsing it. Yeah, exactly. And so after months of negotiations, Adidas and anything that brings disrepute, contempt, scandal to him or tarnishes Adidas. Pretty broad language, especially given some of the behavior that Kanye West displays.

Absolutely. But it's also important to know that while Adidas is getting this moral clause, Kanye West is also getting a lot in this contract as well. It's loaded with financial incentives for him. You know, during the negotiations, Adidas was predicting that Yeezy sales would grow to $1 billion a year by 2021. And under this deal, he will continue to get a 15% royalty of net sales. I just want to pause because that is a lot of money. 15% of a billion dollars. Right.

And on top of that, he will also get $15 million up front, along with millions of dollars in company stock each year. So this is what going all in with Kanye West looks like. For Adidas, it means getting a morals clause from their partner. For Kanye, it means a boatload of money. they met certain financial targets, it could extend for a full decade. And, you know, as Kanye said when he signed the new contract in May of 2016, the partnership was now a marriage. So once Adidas and Kanye are newlyweds, what happens? A lot happens. Just a few months after signing that contract,

he was on tour for the first time in several years. And he was at first wowing audiences with this floating stage. But then his shows take this really unexpected turn. You ain't got an iPhone, don't put it up. Only originals. He's performing a show in Sacramento, and he's a couple songs into his set. Hey, stop, stop, stop, stop, stop it.

And he just stops and launches into this 17-minute tirade. This is the way of thinking to make America great again. He's praising President-elect Donald Trump. You was lied to by Google. You was lied to by Mark Zuckerberg. Mark Zuckerberg, you want to call me now? He is blasting the tech and media and music industries. He is bad-mouthing Beyonce. And insinuating that Jay-Z's going to send killers for him. Get ready to have a field day press. And then he just drops the mic and walks off stage.

End of concert. End of concert. And he actually cancels his remaining shows. And, you know, it's clear that something's wrong, and that becomes even more evident the next day. So what I was able to uncover through my reporting is that once he was back in Los Angeles, he was displaying behavior in front of friends and colleagues that was extremely concerning. He was writing Bible verses and drawing spaceships on sheets with a Sharpie.

He appeared consumed with paranoid thoughts, like the belief that government agents were out to get him. And when one of his friends suggested that he take him to a nearby office that the friend owned, suggested that he take him to a nearby office that the friend owned. Kanye emerged with bags, suitcases, packed with pots and pans and Tupperware. And when they get to the office, his behavior continued to escalate. At one point, he threw a bottle through a nearby window. And two doctors, including a psychiatrist from UCLA Medical Center, are among those called to the scenes.

And after observing his behavior, one of the doctors calls 911. And this doctor says, I think he's going to need to be hospitalized. He's deeply unwell in this moment. So it would seem. So what happens to Kanye during and after this time in the hospital? So after the hospitalization, he goes on medication for bipolar disorder, which is something that he's talked about publicly. At times, he has called it his superpower. At other times, he has claimed that he was misdiagnosed and he doesn't have the disorder at all. But by 2018, he has gone off the medication, and he is starting to re-enter the public spotlight in ways that many find confusing.

Welcome to TMZ Live. Harvey Levin here. Charles here. Including an impromptu interview that he gives to TMZ. You know, um... In which he claims that... When you hear about slavery for 400 years, for 400 years, that sounds like a choice. 400 years of slavery sounds like a choice. And that causes, like, a total uproar.

Megan, candidly, this sounds like an incredibly difficult time for Kanye and for his family, but it also seems like exactly the scenario that this morals clause you were telling us Adidas wanted so badly is designed to anticipate and react to. So was there any discussion inside of Adidas during this period about invoking that clause? Well, we know for sure that they didn't invoke it, and it's not clear whether they even considered it, whether they even discussed it.

Instead... You mentioned that you attribute a large part of the success to some of your creators. Is anyone more important to you in terms of your creators than Kanye West? I think Kanye, along with others... The CEO of Adidas on a live TV appearance on CNBC. That's the slavery comment away.

Clearly, Kanye has helped us also, you know... Saying that Kanye has helped us have a great comeback in the United States. So I always have to ask you about the latest Kanye West drama because there always... And he maintains that position months later. You know, when you sign up a very, I would say, inspirational and creative person, you don't get mainstream and you've got to live with what you've got. And so far, we've had a good relationship with him.

So the company was very adamant. I mean, it stood by Kanye West after the slavery comment. And it also stood by him as he displayed a troubling fixation on Jews and Hitler. Beyond what he had previously done. Yes. I mean, I mentioned earlier this swastika incident at the very beginning of their partnership. Since then, he had gone on to tell Adidas collaborators that he believed that Jewish people had special powers

that allowed them to amass money and influence. He also had expressed an admiration for Hitler, that he saw him as a master marketer, somebody who had a real gift for propaganda that he admired. You know, at this time, he told Adidas folks that he was considering naming an upcoming album Hitler. He was ultimately named Ye. And it's around this time that he also tells Adidas executive, who is Jewish, that he should hang a picture of Hitler in his kitchen and kiss it every morning to practice unconditional love. That's frankly kind of hard to hear.

It's offensive. And you're saying Adidas, this German-based company with a huge level of sensitivity to the meaning and the power and the risk of anti-Semitism, does nothing about any of this. company, at least what I found in my reporting, is that the company does not appear interested in scrutinizing or policing Kanye's behavior. Instead, they are scrambling to adjust to it and to somehow accommodate it. And how do you adjust and accommodate behavior like this, though? Well, listen, the Yeezy unit, the team with Inside Adidas that worked on the collaboration, I mean, a lot of those people were fans of Kanye West, but still, it took like a huge emotional toll. They adopted a strategy that they like into firefighting, rotating people on and off the front lines to limit exposure to harm. The unit was assigned a special human resources official to help manage the drama. When you join the team,

the company gave you a free subscription to a meditation app to acknowledge how challenging it could be. And so that was what was happening on the group on the front lines. And then behind the scenes, some of the top executives at the company started a group text chain called the Yeezy Hotline in which they scrambled to field Kanye's requests and deal with the kind of constant challenges that arose. Adidas is doing whatever it has to do to manage this brewing problem, no matter how much it seems to upset the people on staff, to make sure that this partnership continues. By and large, they are very eager to keep this on track and are doing everything possible to make that happen. In fact, at this point, Kanye has moved the Yeezy operation to remote Cody, Wyoming, insisting that everybody has to follow him there or face termination. So they agree that they're going to help him build up this campus out there, and they're also going to follow through on giving him $100 million more each year that he can spend with little oversight.

So the more and more volatile, unpredictable, extremely offensive that Kanye West becomes, the more money Adidas is throwing at him and the deeper they seem to enter this marriage. Yes. And because of this collaboration, Kanye West ultimately becomes a billionaire. He's making so much more money from this than through his music. Good morning, Donda! Good morning, Donda! And he launches into

more and more wildly ambitious projects. I want my kids to go to Donda. Donda Academy is a private school he created named after his late mother, Donda West. He starts an unaccredited Christian school, which has since closed and is now under investigation. What is America's destiny? What is best for our nation, our people? He runs for president in 2020. In Liberia, I envision building a city of the future, an infinite city.

And beyond that, he starts talking about plans to create flying cars and build futuristic communities. I mean, he's using language like, I'm going to solve the world's problems one at a time. And as he's scaling up these goals and these ambitions, he has this huge financial engine behind him. Adidas. Adidas.

So we know where this story ends, because that's where we began. This all blows up. What does that blow up look like from inside Adidas? become strained. Kanye's main complaint is that, listen, under the contract, Adidas owned the designs, the shoe designs that they made together. But he said that they were misusing and kind of misappropriating those designs. And he was crying theft at that point. Over the weekend, Ye posted on his Instagram account, taking aim at Adidas board members. He goes on social media and takes shots at the CEO and members of the supervisory board. Last night, Swiss Beats Instagrammed. He gets high-profile friends like Diddy and Swiss Beats to threaten to boycott the company. And it reaches this pretty remarkable moment when he actually shows up to the Adidas office in Los Angeles

with a videographer in tow. And he's meeting with some of the top Adidas executives at that time. And he is making his demands, and he actually ambushes them with pornography. Again. Again. He's showing this porn film about a woman wronged by her cheating boyfriend to emphasize his feelings of betrayal in the relationship.

And in the same meeting, he's making other complaints and issuing threats. At one point, he says, our army is so prepared. This is a different level of nuclear activity that no one will recover from. Oi. This is a different level of nuclear activity that no one will recover from. Oy. And listen, that's what he was doing in these communications and his relationship with Adidas. What happens in the next weeks is his other public behavior escalates as well beyond Adidas. So within weeks, he has shown up to New York Fashion Week and worn, along with the conservative commentator Candace Owens, these White Lives Matter t-shirts. And when that sparks a backlash, he kind of goes on the offensive and basically starts in

interviews and on social media making anti-Semitic comments, calling Black Lives Matter a scam. He ends up going on the Drink Champs podcast and doubling down on everything he's said and even going one step further. The thing about me and Adidas is like, I can literally say anti-Semitic shit and they can't drop me.

He says in this interview, I can say anti-Semitic stuff and Adidas can't drop me. Wow. I could say anti-Semitic things and Adidas can't drop me. Now what? He's basically saying in this marriage, I hold so many of the cards that I can make Adidas stay with me. I can kind of make them complicit. Yeah.

And of course, in the moment, that sounds like shocking to listeners of that interview. But now having reported behind the scenes, you can get a sense of how he could actually say that. Yeah. And why it might be true. Right. At least from his perspective and his experience over those many years of the partnership. But, you know, at this point, he is coming under even more broad and intense attack and criticism. Politicians, Jewish leaders, fellow entertainers, people like leaders in Hollywood are denouncing his behavior and saying that it's dangerous and is going to inspire others to embrace bigotry and are really exerting pressure on Adidas to cut ties. And so just days after that Drink Champs interview in which he was basically taunting Adidas to try to cut ties with him,

the company does just that. They tell Kanye that he has violated the terms of their contract and that they have the legal right to now end it. Well, given just how important this partnership has been to both sides, it's floating Kanye. It's the bulk of his money, you've told us. And for Adidas, it's been their revival. What happens once this deal is off? So Adidas immediately stopped selling Yeezys, and both parties take a huge hit. The company projected its first

annual loss in decades, and Kanye West's net worth plummets. And so the cost of this over-reliance, this mutual dependence that had become so great in this moment, is very clearly laid bare. Absolutely. And it's not over. How is it not over? I mean, it's supposed to be, Adidas says, over. So even as they're publicly attacking each other, Kanye West and Adidas continue to have a shared interest. And that is in the $1.3 billion of Yeezy inventory that are in warehouses around the world and that had been basically just shelved after the agreement came to an end. Fascinating. And by May of last year, Adidas now has a new CEO and he comes out and announces that they're going to actually release all of that

inventory for sale. Huh. Even as they're divorcing, they're still relying on each other. Yeah, they're not missing an opportunity to make at least one more round of serious money. And the cut of those sales would go to the Anti-Defamation League and a group founded by George Floyd's family. But most of the money is going to Adidas. And under the contract, Kanye West is still entitled to royalties of those sales. And so the shoes ended up taking in about $437 million in sales through June, just these first waves. And they're not done with those sales. And so with this influx of Yeezy money, the company has been able to improve its financial forecast for the year, and Kanye West has reappeared. You know, he performed on stage

for the first time over the summer, and music from what is rumored to be a comeback album has leaked online. So in the end, despite everything he did, he's still profiting from this partnership. And so as Adidas, even as it can go out in the world and say, we canceled this deal, we're done with it. We're not affiliated with him anymore. Right. And I think what we were also able to see was that consumers, by and large, were not deterred by what happened last fall.

And the way that these shoes started to sell out again so quickly also showed that many people just didn't care about Kanye West's behavior. And there even starts to be some speculation that Adidas and Kanye West may actually go into another deal again. But, you know, when I reached out to Adidas to present what I had found through my reporting as we prepared to publish our story, they provided me with a statement saying that Adidas has no tolerance for hate speech and offensive behavior, which is why the company terminated the Adidas Yeezy partnership. The company, you know, turned down interview requests and citing confidentiality rules, declined to comment on financial aspects of the collaboration and its relationship with Kanye West. And Kanye West declined interview requests and did not respond to written questions or provide comments.

Megan, zooming way out for a second, there seem to be two ways to think about the story you have just told us. On one level, the story you found here about Adidas and Kanye is really the story, it seems, of a company doing whatever it had to do to appease a troubled partner. Instead of holding Kanye accountable for his behaviors,

Adidas just kept throwing more and more money at him, even as the things he was saying were getting more and more offensive. And the company did not seem all that interested in blunting the impact on the people that Kanye was offending, either inside or outside of the company. But on another level, it seems to be the story of a company getting exactly what it bargained for, right? A provocative celebrity, this mad genius who was going to garner a ton of attention, some good, some bad, that was going to turn into profit. And that's what happened. Adidas got the attention, it got the profit. So what are we supposed to make of all that? and became more culturally influential than I think either party, certainly Adidas, imagined when they first started the relationship.

And I remember talking to a source who had worked at Adidas and had been closely involved in the collaboration who described it like a company becoming hooked on a bad drug. And they just got deeper and deeper and more and more hooked and didn't know how to break away. And so by the time this relationship came to an end, by the time Adidas was backed into a corner and had to end it, you know, you were able to see how completely dependent they had become. On that drug that was Kanye West. On that drug that was Kanye West. And by that point,

it was too late. They had become overly dependent on him. So, you know, they're now scrambling to recover. And it's not clear to what extent they'll be able to recover. There's only one Kanye West. And you can't really replicate what the collaboration with him brought to Adidas. But you also can't really calculate the damage that the collaboration with him brought to Adidas, but you also can't really calculate the damage that the collaboration did to Adidas in the process. Well, Megan, thank you very much. Thanks so much for having me. On Wednesday, a few days after the publication of Megan's investigation,

the CEO of Adidas, Bjorn Gulden, raised the possibility that the company may never release the remaining stock of unsold Yeezy shoes, a decision that he said could cost Adidas about $320 million. We'll be right back. Here's what else you need to know today. On Thursday, under intense pressure from the U.S., Israel agreed to establish daily four-hour pauses in its assault on Hamas in selected areas of northern Gaza in order to allow civilians there to flee the fighting. But Israel emphasized that the pauses were not the same as a ceasefire and that they would have no influence on its broader operation to destroy Hamas in response to the group's October 7th attack on Israeli civilians. And

I believe in my heart of hearts that I have accomplished what I set out to do for West Virginia. I have made one of the toughest decisions of my life and decided that I will not be running for re-election to the United States Senate. Senator Joe Manchin of West Virginia, a moderate Democrat known for challenging his party's liberal wing, said he would not seek re-election in 2024, in a major blow to his party's hope of keeping control of the Senate next year. Democrats currently control just 51 votes in the Senate, and without Manchin on the ballot in West Virginia, Republicans stand a far better chance of winning his seat. West Virginia's Republican governor, Jim Justice,

is already the frontrunner in the race for Manchin's seat. Today's episode was produced by Claire Tenesketter and Shannon Lin, with help from Ricky Nowitzki. It was edited by Michael Benoit, with help from Brendan Klinkenberg and Ben Calhoun. Contained original music by Dan Powell and Chelsea Daniels, and was engineered by Alyssa Moxley. Our theme music is by Jim Brunberg and Ben Lanzifer of Wonderland. by Jim Rundberg and Ben Lanzifer of Wonderland.

That's it for The Daily. I'm Michael Babar. See you on Monday.