(Yicai) April 30 -- Adidas said revenue at the German sportswear giant's China unit increased for the eighth quarter in a row, thanks mainly to growing interest in sports and fitness among Chinese consumers.

Adidas China's revenue jumped 13 percent to just over EUR1 billion (USD1.14 billion) in the three months ended March 31 from a year earlier, its Herzogenaurach-based parent company said in a financial report released yesterday.

Adidas China benefited from a growth trend in sports consumption in the country, said Managing Director Xiao Jiale. The Chinese sports market still has untapped areas to develop compared with the mature European and US markets, Xiao added.

“Consumption upgrading is not only about behavior but also about mindset,” Xiao said. “As a result, the sports sector is becoming increasingly segmented, and the idea that different sports require different shoes has become a commonplace.”

Adidas has been enhancing its brand presence and appeal in China in recent years. It has signed top Chinese athletes such as Paris Olympics swimming champion Pan Zhanle, formed long-term partnerships with volleyball, tennis, and track and field associations, and supports major sporting events, including the Beijing Marathon and the Shanghai Half Marathon.

Analysts also believe Adidas's earnings growth is due to the company's localization strategy in China over the past two to three years.

Adidas has granted full autonomy to its China arm to strengthen localized operations, letting it manage all business aspects, from production and marketing to channel development, the unit previously told Yicai. By allying with Chinese suppliers to upgrade supply chain capabilities, over 80 percent of the company's products are now made in the country, it added.

Adidas' global net profit surged 151 percent to EUR428 million (USD486.5 million) last quarter from a year ago, while revenue rose 13 percent to EUR6.2 billion. Its income in Europe jumped 14 percent to EUR2 billion, while that in the United States climbed 2.8 percent to EUR1.2 billion.

While acknowledging Adidas' first-quarter achievements, Chief Executive Bjørn Gulden expressed concern about the uncertainty surrounding this year's performance as a result of higher US border taxes.

"In a 'normal world' with this strong quarter, the strong order book, and, in general, a very positive attitude towards Adidas, we would have increased our outlook for the full year both for revenues and operating profit," Gulden said. "The uncertainty regarding the US tariffs has currently put a stop to this.

"Although we had already reduced the China exports to the US to a minimum, we are somewhat exposed to those currently very high tariffs," Gulden added. "What is even worse for us is the general increase in US tariffs from all other countries of origin. 

“Since we currently cannot produce almost any of our products in the US, these higher tariffs will eventually cause higher costs for all our products for the US market,” he said.

Adidas left its guidance for this year unchanged, including sales growing at a "high single-digit" rate and operating profit increasing to between EUR1.7 billion and EUR1.8 billion.

Editor: Martin Kadiev