Ladies and gentlemen, thank you for standing by. Welcome, and thank you for joining the adidas AG Q3 2023 conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode. The presentation will be followed by a question and answer session. If you would like to ask a question, you may press star followed by one on your touchtone telephone. Please press the star key followed by zero for operator assistance. I would now like to turn the conference over to Sebastian Steffen, Head of Investor Relations. Please go ahead, sir. Thanks very much, Andrea. Hello, everyone. Good evening, good afternoon, good morning, wherever you're joining us today, and welcome to our Q3 2023 results conference call. We know it's a pretty busy reporting today, so, we definitely appreciate you joining our call today. Our presenters on the call will be our CEO, Bjørn Gulden, and our CFO, Harm Ohlmeyer. As always, I would like to ask you that during the Q&A session, you limit your initial questions to two, to allow as many people as possible to ask their questions. And with that, and without any further ado, over to you, Bjørn. Yeah, thanks, and hello also to everybody from me. As always, we will take you through a lot of pictures and some numbers, both Harm and myself, to tell you, what we are working on, and, what is going on. I'll start with some good news. You know, there has been a lot of critique and negativity around adidas, that we are not a good company, and a lot of critique on different things. Therefore, I'm actually very proud to see the Forbes research that says that we are, you know, one of the 12 best companies to work for and actually the best one in the sports industry. And I think that, I've always said that adi is a great company, and, and being on the inside of it, I can confirm it, and it's also cool to see that external people say the same thing. We have talked a lot about, you know, the soft values, and, also, a couple of weeks ago, we had what we call a Global Week of Inclusion, you know, where all minority groups and, and all groups in general were able to, you know, present their views, and we discussed on how we should behave with each other. And in a global company, this is extremely important, and, it was actually very interesting to be part of it and proud, of the outcome. Also extremely proud to look at what our team in Ukraine is doing, under very difficult circumstances. The stores are open, they run the business, and they're also now starting again, the running club. And as you know, sports is always important, and the spirit of our people in Ukraine is just fantastic. Unfortunately, over the last months, we have another conflict in our world, which will impact us, I think, for a while. We have about 620 people in Israel, in the offices and the stores. Good is that none of them are hurt, but many of them are now being called into the army. What we have done is, of course, to assure all the safety of all our people, and then we have started donating, you know, for other people, and also in the Gaza area through SOS-Kinderdorf, and we will continue to do that, of course, to help the civilians in the area, in this terrible conflict. When you then look at the business, I think it's fair to say that we are trending in the right direction and a little bit better than what we have told you the last nine months. And by that, the financial performance, I think both top and bottom line is a little bit better than expected. I think the energy in the team, and especially in the decision-making, has improved, so we are becoming faster and therefore, in my opinion, better. We are getting extremely good feedback from the retailers for Fall/Winter 2024, and you have to remember that Fall/Winter 2024 is the first go-to-market process. That is the way we would like it to be, and the first time we have gotten together as a team, treating the retail partners the way we want, with full set of samples, showrooms, and also I will say, with a service degree when it gets to SKUs and all everything. And I'm pretty certain that we will have a very good order book building for the second half of 2024. The sell-through of our new product is improving. I'm sure you see that also in the stores that you are. And of course, for us, it's about getting enough of the new good inventory through the slow-moving inventory. And as you probably have seen already, the great thing is that our inventory is heavily down 23%, and we feel that our inventory at the year-end will be under control, with the exception of the U.S. I also think I said in my quote that retail inventory is improving, and therefore, you know, it should be during the first half, an improvement in the total sell-out, and of course, then also building then the order book for the second half. Inventory level in the U.S. in general is still an issue. I think it lacks about six months for the rest of the world, but very proud of what, Harm and the team in finance and also what the operational team has done, and you will see the details of that, later. If we then get to the top line, North America was down nine, 15 for the year, so you see that at least the quarter has improved. We still have issues in our American business, that we have to work through. We had a management change. Rupert, who's been the president for about two years and 11 years with the company, resigned and ended his, great career with, adidas end of October. As an interim solution, our board member, Arthur, has taken over, and then the idea is that during Q1, we will announce a new permanent president, and should not be a surprise that we they're looking for an American citizen. The issues in the market hasn't really changed. There are still elevated inventory, both, in the trade and also in our own books. And especially in all the successful outlet business is then almost only clearance business, which is, has a drag on both sales, and on margin. The good thing is that our full price concept stores are all comping like-for-like, open with a higher margin. So you clearly see that the D2C business is improving where we have the right, merchandise. We do continue to see high discounts, and we will, of course, continue to be very conservative in the way we sell product in for the next six months. Told you about this before, but we need to be more American. That's why the office that we open in L.A. in Q1 is so important. It will focus on the American street culture, also connected to basketball and all of American partnerships when it gets to collab and street culture relevant, collabs will then be managed out of L.A., and I think this is a game-changing thing for us. There is no resource of this yet because this was open in Q1, so you will not see the impact of this in product until, I would say, Q2, Q3 next year. Stores, I mean, I've been in New York every month, and very happy to see the development of all of the stores in New York. Here you see some of them. As the good inventory has flowed in, the like-for-like has continued to improve. And in the stores you see here, they're all up double-digit like-for-like, and it clearly shows that the consumer is reacting very positively, even in the U.S., to our new merchandise. Messi's entrance to the U.S., we talked about many times. What he has done in Miami is unbelievable. They didn't qualify for the playoffs, but they won the Leagues Cup. And when you see his pink jersey, it's the most sold jersey in the U.S., I think, ever. And of course, it has had an impact on what we call also soccer street core in the U.S. I'm extremely happy that he went there instead of going somewhere else. Also, cool in the U.S., we were part of the biggest women's event ever. 93,000 people or 92,000 people watching our Nebraska Lincoln women's team in volleyball playing. And again, one of the small pieces in the focus on women's sports that I think is going to be very important also going forward. American football, extremely important for the U.S. market. Patrick Mahomes, probably being, you know, the, should I say, not only the best, but the coolest player in NFL. He was also in Frankfurt last week. We just launched his collection, his training shoe, and we will do more products with him, branded with him. And I'm very, very, very sure that we can market him as a superstar and also get much more commercial success of him, especially in the U.S. We have also started to sign college athletes, you know, legally with the NIL agreement that's now allowed. And also here in American football, we started to invest in that. And it's clear to say that both college and high school sports for us, you know, connecting to the sports youth culture in the U.S. is going to be important. And here you see a couple of examples of players that we have just signed. Changing into EMEA, Europe, Middle East, and Africa, +2, same, in the quarter as for the year, so basically the same business. Also here, you know, investing in things that are a little bit different. We extended the Kings League. If you follow it, you know, a very cool league, for the Gen Z coming out of Spain. They will expand this concept into other markets, and it's soccer done in a different way. And the same thing with the Battle of the Socials. We do try to connect with our traditional sports also into the new generation and into the social media, and are doing quite some stuff outside, you know, sponsoring the big teams and the big players, and these are two examples of it. We talked about India and cricket. You know, we signed the beginning of the year. We have sold more than 500,000 jerseys of the national team. Very, very unique, I think, for the sport, and also very cool for us. The team won the Asia Cup and is currently playing the World Cup. I think the final is on the nineteenth, and that will give another boost to a business that I've said many times. I think India will be the fastest growing market for us, and that's why it's cool to see that that investment has worked very well. Another market that people talk a lot about, Saudi Arabia, we just opened the office. Harm was there to open it. And it's clearly that Saudi Arabia will play a sports or play a bigger role in sports. We know that they are trying to get events. We know that the league is attracting players, and I'll be very surprised if you don't see Saudi Arabia investing even more into sports, and that is for us natural also to open an office there, which we now have. If you then move into a big, big, big important market, Greater China, we were up 6% for the quarter, 3% for the year. You remember we started the year being down double digit, then the business has improved. All of us, all board members has been to China, not only one time, but more times. We have talked to the trade, we have talked to the political, to the government. We have talked to the different sports federations. And been very active to understand what we can do and not do. And I'm happy to report that, you know, the local focus, the energy of the team, is starting to improve the business. You see the growth numbers are not that great, but if you take the GC business out, it's already double digit. And all, the D2C business, where we really have the best of the best, are up double digit. And as I said many, many times, I'm a big believer of the market, and I'm really, really, what should I say, proud of the energy of the team, and feel that we are on a very, very good way. We also took our basketball stars to China. We started our graduates program again, and we know that basketball still is the sport that has the most street-relevant culture, so we will continue to do that. We will also start to build basketball product for a price level that will compete with the local brands because we clearly see that there is two different markets. It's the market at the top, where we compete now, but there is also commercial market, especially the local brands, have established price points that we also need to enter, for example, in basketball, but also in running. Talking to running and other sports, for the first time, I think in a long time, we have invested then in many, many sports, from track and field to volleyball to tennis. And the team is signing more and more athletes, so that even if the market is small now, we will be a real sports brand in China, because we think that's very important for the future. We will overinvest in this, in the next couple of months, and also in years to come. A cool thing, you know, the break dance thing, which, you know, is also going to be an Olympic sports. That's where we already have a big, what should I say, impact. And needless to say, when you see Three Stripes, and you see here, I think it's Superstar, you clearly see that we fit into that, and have already, I would say, good connection to that generation, in that market. To service the growth that we foresee in China, we just opened also the most modern and the biggest distribution center. Harm's there. And again, it's a commitment to the market with the best technology and the most automated warehouse that we have. Yeah, I'm sure Harm will say something about that later. Going into LATAM, 13% for the quarter, 29 for the year. So the growth was slower in this quarter. As you probably know, LATAM, many of the markets are in a political, what's the right situation, with elections. There's a lot of inflation and uncertainty. So maybe a little bit more careful growth, but as you can see, still double digit. And we have the feeling that the team, with investments in sport, but also the energy they have on the activations, are doing a great job. Here you see we sponsoring running events in all the markets, and we are opening new and modern stores in all the major cities. And the D2C business there has developed very, very good. And again, I'm sure that LATAM will still be a growing market for us. Very excited about Asia Pacific, up seven for the quarter, 10 for the year. You know that both Korea and Japan are very trendsetting markets, of course, very lifestyle-driven. And here we also clearly see that the success of our lifestyle business is having a big impact. And when you see the reaction to both the original campaign that we started in September, but also to the terrace trend and all the trends that we have generated, our stores are doing extremely well, especially actually, in Korea and Japan. So when you look at all that, you see that the Q3 growth was then 1%, and we are flattish for the year. If we then take a quick look how it looks compared to the non-GC business, you see that North America was 9% up in total. If you take Yeezy out, 9% down for the quarter. If you take Yeezy out, then we're minus 10, so a small impact. EMEA, actually, no impact, plus two, plus two. Greater China, you know, plus six, with Yeezy, +10 without. You clearly see that the impact of Yeezy was less, and the underlying business is stronger. LATAM, almost flattish. And then Asia Pacific, a little bit the other way, where actually the business was then helped by the Yeezy business, with plus seven to plus five. All in all, as I said, our growth at 1%, if you exclude Yeezy, the underlying business was then up 2%. If you look at the channels, wholesale business down, too, you have to remember that we started the quarter with an order book that was down more than 20%. I've always said that the second half order book was very, very weak because of all the inventory and because the way the retailer was reacting to adidas, you know, a year ago. So you can see, we've been able to chase the business, and then deliver into the trade, you know, much more product that was not on order from the pre-orders, but actually then, product that we accelerated, and scaled, especially on the lifestyle area, where they were able then to sell through, and of course, then also make money with us. On retail, brick-and-mortar 10%. Number of stores, if you take China, Russia out, flattish. That means that most of this is like-for-like growth. Very happy to see that, our concept stores, meaning the full price stores, are actually up between 10%-15% everywhere. And then the factory outlets are, of course, weaker, because as we know, they are currently selling almost only clearance. But the most important thing is that our own retail full price concept stores are up double-digit. E-com, up one. Same thing here. We have said that it's not to optimize or maximize top line. It is now to balance the brand side of it together with commercial success. So the share of full price here has increased substantially. We're protecting our franchises, and the new management of digital clearly has the view of being more branded and value creation than maximizing top line. That's why we're actually very happy with that number under the current circumstances. That gives you the current split, 63% wholesale, 37% DTC, and as you can see, brick-and-mortar and e-com is basically 50/50. Talking about digital, we had a change in the management. So Scott left us as the Chief Digital Officer, and we welcome Tobias again. He has a big history with us, but also with other digital companies, and was a natural replacement, when Scott decided to go. I think Tobias has been here for a month, and he's already had a big impact, on, you know, looking at the strategy, making sure that we build plans based on the new adidas and the new environment in digital. And then, of course, make sure that we really are pushing the brand side and not only the commercial side. If you look at divisions, a very important for us, that footwear is still growing, here at 6%. Apparel, we said was going to be down with all the inventory in the market, down 6%. And then accessories for the quarter, a little bit worse than flattening. Remember, last quarter, it was up because of all the, the football accessories, so, I would say in line with our expectations. Footwear being almost 60% of the business, apparel 36%, and accessories only 6%, I think a very healthy split. You could argue that accessories, which should be high margin, could be bigger, but as long as footwear is above 50%, I'm very happy. Performance, basically a flattish business. Football being up slightly, running flat, training down very, very slightly. Outdoor, strongly up. Golf, actually down now. We clearly see a stagnating side on the golf side after a, you know, a series of quarters with positive numbers. Specialty sports down, but that has more to do with deliveries into the market, and then U.S. sports up, especially a very healthy business in American football. Which is kind of cool for us that we, in America, with Three Stripes, can actually have high market share in American football. That tells us that if we build the right product for America, we can actually also be good in the U.S., sports. On the performance side, don't need to talk a lot about it, but very proud of Women's World Cup, not only winning with Spain the whole tournament, but also taking three of the four individual prizes with our players. And again, a clear commitment from us to women's football. And I think the tournament was a great, great win for women's football in general, and look forward to that investment to continue. Some cool things we're doing on women football, not only building now shoes for her with specific models, but also starting to use collab partners. Here you see that one of the jerseys that Arsenal is playing is actually a collab with Stella McCartney. You will continue to see us actually doing different branding on certain teams to make it more street relevant and build brand heat also through the combination of, I would say, partners, originals, and performance. Cool collab on the soccer/football side. Here, an example of what we just did with Bugatti. And again, same thing here on footwear. We will do more collab product to create heat, do more limited edition, and create excitement in football, and we have all the vehicles to do that. Welcome home to Newcastle. You know, after a while, they're coming back to Three Stripes, you know, with new ownership and very, very high ambition. This is a great fit, so look forward to that. Ballon d'Or, almost as usual, Messi won his eighth, and then I think the future, Jude, you know, won the Kopa Trophy, which is the young players award. And again, needless to say, he's probably the superstar of the future and, of course, playing in our product. A lot of critique on us that we're not having enough innovation. I think that is not true. And I think, you know, the Pro Evo shoe here from Adizero is a good example. The lightest shoe in the market, the best performing shoe in the market, setting also the world record. You know, with Tigist, here in Berlin, almost 2 minutes better than the previous one. But also in other, what should I say, records, if it's records on tracks or it's records in markets, this shoe has been unbelievable, and it shows that we can bring innovation very, very quickly to the market, if necessary. I'm very proud of that. Then, in general, in running, we are investing a lot of money into events and to athletes to build credibility. We know we still have a long way to go, to actually be back again where adidas' belong. But we have the credibility now by winning races, arranging races, and having the best performance shoes. So now the job is, of course, to build credibility also into the commercial area, and that's what we're going to do, in the future. Same thing on track and field. Very important for us to be in the most, what should I say, credible sport. In Budapest, a lot of our athletes did a great job, and we're very visible with the footwear. Going forward, you will see us signing and more federation to also be visible on the apparel side. And again, as I've said many times, we will invest more and more money also into the smaller sports. Same thing on outdoor. You know, I think with the Agravic Speed Ultra, we have the most innovative trail running shoe. And I hear the same thing, winning a lot of events, taking part in many events, and showing innovation as a big part of an investment of what we're doing in TERREX. Very proud also what happened in the Rugby World Cup. You know, Siya Kolisi, the captain of the South African team, nine months after he pulled his ACL, he captained them to the championship. A great ambassador for our brand, fantastic guy, and even if he beat the All Blacks, which is our team, you know, he's a great, great part of the family. And the same thing with the All Blacks, probably the team with the best spirit in the world and in any sport, doing their training camp here in our campus. Very proud to work with them, and I'm very, very happy that we extended that contract, and we will extend that cooperation into also other product categories, also into the lifestyle area. If we then look at the lifestyle side, the business is up for the first time in a long time. Good growth in the higher area with Originals. Basketball also growing double digits, so we clearly see that, you know, the higher end of the market is accepting our new product. Sportswear, the more commercial side, is still down a little bit, but again, with the pipeline of more commercial products for 2024, we will also turn that into a positive number. And needless to say, the left side is more important in the beginning to create, you know, brand heat again, and that's what we have actually been able to do. Couple of things that we have done in the basketball area, we have signed a new multi-year contract with Overtime Elite, which is professional leagues, both in American football and in basketball, linking the college athletes into the professional leagues, the NBA and NFL. We will do a lot of collabs and partnerships with them to be more connected to that youth culture in American sports. Then Anthony Edwards, the new superstar in NBA, launched his first signature shoe, as you see here. We launched it on the field of play in September, and it's now being rolled out in the different markets. Needless to say, he captained also the American national team, and we expect actually a lot of good stuff coming out of that cooperation. Mostly proud of probably is the Originals campaign that we launched in September. The first campaign I think adidas has done for Originals since 2015 or 2016. Very well received. A campaign between EUR 50 million and EUR 100 million in media money. Very well executed all over the world, both with global stars, but also connected into local celebrities. It's a message that we will continue to use also going in to 2024. The collab with Moncler, you know, launched in their fashion show a couple of months ago, now in the stores. The same thing here, Moncler, for me, the only luxury brand that has connected into the winter culture, and for us, being together with them, with fantastic product, very, very thankful for, you know, their CEO, that they did that, and the product also selling very, very well. Couple other things, we did the collab with Korn, sold out very quickly, you know, a collab that is also connecting to the young consumer. Then we did in China with Edison Chen, a collab, both on the global, as you see here, but also local. And here you see people lining up in front of the stores. So one of the very, very high impact collabs that we've done shortly. And you know, this is the replacement that we have to do to replace the easy business. We need many smaller collabs that can create the heat and that we then can commercialize. Not surprising, probably, Samba is being named the Shoe of the Year in the U.S. so we will receive that award, I think, end of the month. And then I've said many, many times, what has turned the brand lately is, of course, the Terrace trend with the Samba, Gazelle, and Spezial. We have then lately seen Campus outselling Samba in certain markets already, especially, I would say, in the men's area and the kids area. So then we have something outside terrace that is working well. And then those of you who follow fashion have seen that Superstar, especially in black, white, and triple black, is picking up, and that's a shoe that we will heat up for the future. Extending the terrace thing also into running, we are into the 1970s running here with the SL 72, which is then a natural evolution for us, again, getting into running lifestyle, and you will see these products starting to seed in in Q1, and then be scaled into the second half of next year. We are also working on four or five very interesting silhouettes on the running lifestyle side, of new silhouettes to replace, you know, the successful shoes that we had, for example, the NMD. Needless to say, next year will be full of three stripe and color. You know, this is in line with what you see on the footwear side. And we have, I think, 16 color combinations coming, you know, in different silhouettes, and you will see a lot of this in the market, and this is being very well received, currently of the retailers. Couple of words about Yeezy. You know, we have had two very successful launches, one in Q2 and one in Q3. We are still sitting on about EUR 300 million of the inventory, and we have decided not to have any more launches during Q4. We'll then spend the rest of the year then to evaluate what we should do, next year. I think with that blah, blah, I'm ready to hand over to Harm, who will take you to the real reason why you're listening, the numbers. Thank you, Bjørn, and, he gets a deserved break for a couple of minutes now as I guide you through the, financial update. Well, unfortunately, there will be not a lot of news, which is probably fortunate as well, because we did the, you know, pre-release already a couple of weeks ago. So what you see in the P&L, should not be a lot of news for you. Again, EUR 6 billion on the top line in Q3, leading to a 49.3%, you know, gross, you know, profit, and then, to an operating profit of EUR 409 million. Of course, all of you are interested, what is the relevance of Yeezy in these numbers? In the EUR 6 billion net sales, which is roughly a 1 percentage point, the currency will increase EUR 350 million Yeezy in there. As Bjørn alluded earlier, if you would do a like-for-like, without Yeezy, it actually, you know, 2% up currency neutral. And also on the gross profit, if we exclude the Yeezy part, the underlying business at 48%, you know, gross profit, and I come back to that in a second. What's also important, looking at our infrastructure, because we always said we need to have a healthy top line, and we need to continue to grow the top line to grow into our infrastructure, while we also, you know, right-size the infrastructure through the one-time cost. So we have EUR 1.9 billion operating overheads, which is around 32.1%, but in there was EUR 110 million extraordinary costs. So EUR 80 million one-offs, which is a combination of, you know, severance, DC closures or retail closures and impairment, and EUR 30 million donation linked to the Yeezy business. So if I would deduct that one, we are getting closer to the 30% line, which again, would contribute also to the, to the bottom line, in a healthier way. So and on the bottom line, it's EUR 150 million Yeezy is included there. So as gross margin is a very important KPI for us, I want to decompose that a little bit when it comes to Q3 compared to prior year. As you would expect, freight is a significant, you know, benefit in that, gross margin bridge, but also the underlying business mix is positive compared to prior year. What is the business mix? Of course, it's a combination of, you know, category, you know, mix, market mix, channel mix, but also what kind of products we are selling when it comes to footwear versus apparel. So all of that is in, and that's why I want to say I, I call it business mix or underlying business, which is healthier compared to last year. Inventory allowance, given the progress that we made on the inventory, also contributed positively. And then we have a significant negative impact on the currencies, on the FX, because as you know, we are hedging, you know, early on, going into this, that season, and that is significant, negative impact on our gross margin. And compared to prior year, as we continue to clear some products, especially on the wholesale side and in our factory outlets, and primarily in North America, it had also a negative impact compared to prior year. If I compare that quarter to quarter, you see the similar impact on the freight. It's very positive, and it will continue to be positive for the next couple of quarters. Discounts here is already positive because we made so much progress on the inventory, so that is also something you should expect, you know, going forward. And the business mix is slightly negative. That is a reason as we are expanding, you know, our wholesale business as a higher share of business, and that has an impact there. And of course, when you come to the market mix, it's a similar impact there. FX, it's also negative because we are going into a season of negative impact, and that will continue to go into, you know, early next year as well. And here, like-for-like from Q2 - Q3, Yeezy also had a negative impact because we had, on the one hand, a smaller business in Q3 whereas the second quarter, and of course, it was a mix of our own D2C business and a combination of our wholesale partners as well. So that hopefully sheds some light into our gross margin bridge. What probably was new today is our balance sheet information in more detail. The highlight is probably the first number. The inventories are EUR 4.8 billion. Again, 23% down, reported 90% currency neutral. And I give you one more, you know, details on that on the next page, but that is definitely a significant progress that we have achieved over the last couple of quarters. Accounts receivable are somewhat down, and given our declines still on the wholesale side, and the accounts payable are significantly down as we bought less, you know, given our trajectory of the business overall. So it shouldn't be a surprise, and that was required to bring the inventory down as well, linked to conservative selling and making sure that there's sell-through in the market. One more number on this page is the, you know, cash on the balance sheet. It's roughly EUR 1 billion on the balance sheet. Also, that is a healthy level compared to 12 months ago. I'm, as a CFO, very happy to see that, development on the overall balance sheet. Very healthy situation on the balance sheet. When it comes to the inventories, we all remember Q3 was a peak on inventory last year with EUR 6.3 billion. To compare this to today, it's EUR 1.5 billion down. That is significant progress. Also look at year-end EUR 6 billion. We made significant progress. We always said it will improve quarter by quarter, but now being at EUR 4.8 billion, EUR 300 million of that, Yeezy, and still having, you know, higher, you know, product costs than twelve months ago. Overall, from an inventory point of view, we are now at a point where we're happy with that inventory. We're happy what we have on our side, and of course, you know, by the year end, we are also happy what we have around the world, but North America, when it comes to our retail partners. Still North America, slightly too high, and especially with our retail partners, we still need to work a couple of months to get to a decent level of inventory, but tremendous progress and happy where we are, and do not expect this coming further down going forward. Now, of course, we gave a complicated guiding, guidance at the beginning of the year, and we changed it a couple of times, so I want to explain that a little bit in more detail. Going from net sales to operating profit underlying and operating profit reported. We started the year with a high single digit decline on the net sales as a guidance. We changed that to mid-single digit decline on July 24, and when it comes to the guidance a couple of weeks ago, and today, it's now only low single digit decline. So significant improvement on the top line over the course of the last couple of quarters. We have not changed in the last update on the underlying business, which was reported as a break even. Now, we said even that one is improving, not just on the top line trajectory, but also operating profit point of view. Now we believe, you know, EUR 100 million is now the guidance for the underlying business, excluding any one-offs or Yeezy business. And of course, what we're gonna report is yet another number. We started with EUR 700 million decline or loss as a starting point, moving to EUR 450 million, and now we believe, as we had a second drop in Yeezy, we can report a loss of EUR 100 million. How does that relate to a probably simpler bridge? How did we get from the EUR 700 million to the EUR 450 million? That was linked to the first drop of Yeezy, where we generated a net EUR 150 million in profit and EUR 100 million less potential write-off of the Yeezy inventory. A similar thing happened now in the third quarter, another EUR 150 million net profit from the Yeezy drop, from the second drop. Of course, with that, less risk of writing off the Yeezy inventory because we sold it. Then what's new now is also that the underlying business has improved by EUR 100 million to now lead to a guidance of EUR 100 million negative. I know this is not where we want to be, but we show significant progress, but now I want to hand over to Bjørn again, know where we head from here. As Hans said, we are not where we would like to be, but we have asked you for some patience. We feel that we are making progress, and actually a little bit faster than we thought. There was a lot of critique from you that, you know, we're not creating brand heat, we are not having, what should I say, innovation. I do actually believe that that's not true at all. The pipeline is full of innovative products. I think also the lifestyle side, we've been able now to activate, you know, four or five of the franchises. That will also move into a high-low effect, on the apparel side. In the next couple of weeks, we will have, finally have the Fear of God product that we talked about for a couple of years in the market. They are now in the markets and will soon be in the stores. We will, in the next week, actually next week, launch the ball for the European Championship here in Germany. That will be done in Berlin. For the Indian market, we will probably win the World Cup final with India. Again, it's been a huge investment for us that has paid off. We actually do believe that if you give us the time, we will show you that we can again be the best sports brand. I ask you, when you say you're long term, to think long term. Q4, when you do the math, you will say you're too conservative. It's obvious that we will not do something to look good in Q4. We will build the base for a better 2024 and a successful 2025 and 2026. That is important. And then you will ask about the Yeezy inventory. You know, in that outlook, it's currently that we write off all the inventory. If we will do that or not, depends on many factors. And if we don't do it, of course, you can add that back again, you know, to your P&L. And I think with that, I've already answered some of the questions you will have, but I hand back again to head of IR. Thanks very much, Bjørn, and I'm sure there's going to be more questions. So Andrea, we're happy to take the questions now. Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star, followed by one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star, followed by two. If you're using speaker equipment today, please leave the handset before making your selections. Anyone who has a question may press star, followed by one at this time. The first question comes on the line of Aneesha Sherman with Bernstein. Please go ahead. Hi, good afternoon, and thank you for the opportunity to ask questions. I have two questions for you, please. The first one is, your Q4 guide implies a pretty big deceleration in revenue trajectory, you know, double-digit revenue declines at the midpoint. Can you talk about what's driving the deceleration in your performance, and does your current performance align with that Q4 guidance so far in the quarter? And then my second question is, Bjørn, you talked about your ability to sell in product this quarter and the past that wasn't part of the pre-orders originally. Given that response, are you seeing retailers change and have more appetite for higher pre-orders in H1 or H2, 2024? Thank you. Well, your second question definitely is yes. As I tried to say is that, you know, nine months ago, we started to look up on how we would like to treat the trade in the future. And that has to do with what we offer them, how we offer it, how we treat them, blah, blah, blah, and that actually our retail partner is more important for us than D2C. And of course, to set that up takes some time. And the first, what should I say, go-to-market process that is in line with that is for fall winter 2024, which is happening right now. So we clearly see a big increase in the interest of the retail partners and therefore expect a much higher order book for the second half of 2024. You have to remember that we've been working on a negative order book, as long as I've been here, in the sense that, you know, the sell-through of the product, the inventory, has not been good. Therefore, the pre-orders for all the quarters in 2024, not 2023, was negative. And that will improve all the quarters in 2024. I think I said to you that the order book we were working against for Q3 this year was over 20% -. We ended at -2, so the difference is what we then have chased. And I think I also said to you on the lifestyle side, when we began the year, the whole Terrace thing was not on the calendar to be scaled this year, but next year. Of course, you have seen that the visibility of that has turned around, I think, the image of the brand very quickly, and that is based on actually chasing the business, and then put good product on the shelf and therefore increasing the sell-through. But what you also have to understand that we cannot do that with everything. So hopefully, when we get to Q1, Q2 next year, we can actually fulfill pre-orders, which are then increased in these areas, and we can have a more plannable business. The reason why Q4 looks the way it is, is of course, we are not going to chase any business in the sense that we will pull anything forward to look good in Q4, because it makes no sense, because then we will actually put even more pressure on the pipeline. So Q4, for us, will be to lay the foundation for, you know, a better first half next year and a very good second half next year. And that's why the guidance is the way it is. I'm sure when you do your math, you think it is conservative, and maybe it is, but you also have to understand that for us, the performance in those three months is not relevant for the long-term story of adidas. So that's the way we deal with it. Same with Yeezy. We could easily have sold Yeezy in Q4 to look good, but it doesn't make any sense where we're sitting, and I hope you agree with us that what we're trying to do is to build a business now with brand heat, with performance and lifestyle product that we can extend for a longer period of time. We have gotten the inventories down. Of course, we need them to improve the quality of the inventory, both in our own inventory but also in the trade, and all those things are not done in 12 months. So you need to be a little bit patient and believe in us, and then we will actually convince you that the strategy is correct. But your math is of course correct, and then we will see if it's a little bit better or if we will end exactly on the guides. That's very clear. Thank you. The next question comes from the line of Graham Renwick with Berenberg. Please go ahead. Hello, good afternoon, everyone. Thanks for taking my questions. Just firstly, on full price sales, you made quite a few comments there of making good progress on full price sales mix. Just to be a bit, put a bit more context to that, are you able to tell us where full price sales were as a percentage of either that's brand sales, Yeezy, pre-pandemic, where that mix is today and what your ambition is for full price sales mix in the midterm? And on running, it was flat overall in Q3. We've seen the headlines of athletes breaking records in Adizero shoes. You mentioned the Adizero family is up strong, double digit, but I presume that's from a low base. I just wondered how long it takes to build that credibility and better distribution in the commercial segment. So when will we see Adizero's success at the athlete level start to cascade down to stronger growth across the broader running business? And should we be expecting a big impact as soon as next year? You know, are you already seeing that stronger demand in order books, or is this something that needs to be developed over a longer timeframe? Thank you. Well, I think your first question, I mean, what we clearly see is that the new product that we have been chasing, the real demand, is selling at full price everywhere, in actually all markets, in all channels. And then, of course, not all the products we're selling is that new product, and this is the, what should I say, difficulties that we are in, is that there isn't enough good product to kind of replace the bad product, and that's why the numbers are not better than they are. If we only had the right product now, we would already, you know, promise you probably 10% EBIT next year. So it takes some time to get through all the issues that we have had, because you have to remember that we had an order book being down 20% because the retailers were full of product that didn't sell. And we have been able to take the inventory down, partly in our own, as you saw, you know, down 23%, but also with many retailers, we've been able to, you know, clear a lot of products. So we are cleaner than we've been before. That's why the full price sales of new product is much, much higher. On our e-com, we have protected our franchises, so we are not allowed to discount them ourselves, which should also help our retail partners. And the full price share is then going up, and margin is going up. But of course, when you look globally, and especially in the U.S., all our outlets are selling at a high discount because it's only clearance. So we are not there yet. And a lot of the retailers still have, you know, too much of the inventory that was not selling and is now being sold at a discount. So the picture is, of course, not as clean as we would like it to be, but the trend is right. And I think, you know, with the facts that we now have and the way we work with the retailers, and especially the reaction for the pre-orders for Fall 2024, is, of course, that now they can buy a brand that is selling well with new product. There's the trust on how we go to market, and of course, we're then starting to build our business on facts and not only belief, so it's a better situation to be in. In the running area, we have chosen, or what should I say, the business unit have chosen to build credibility at the top. So the Adizero range is probably, I think even competitive, will say, the best technical product in the market, and it's selling and performing very well. But as you rightly say, it's a small part of the segment. And of course, our challenge then is to take that, what should I say, credibility, having the right athlete, the right technology and the right product, and then cascade it down to more commercial product. And of course, the speed of that, I can't promise you, but, but it's better to do it that way than the other way around. You know that there are other brands currently that has played the comfort game. I mean, both HOKA and On has had success with, their story, and you should not be surprised to see also in our line, you will have more running shoe that is built on the comfort story. I can't promise you any numbers. The only thing I can promise you that the visibility in running will be increased, so you will see us at more events, you will see us with more athletes, and you will see us with more, what should I say, products out there, and then we will be patient. On running specialty, it's also fair to say that Adi left running specialty in many markets, so we didn't have a sales force anymore. The idea was that the runner will buy it in our D2C, and that doesn't work. So we are again building our sales force, and I would say, technical experts to support running specialty, to also build a real relationship to running community, which you have to do physical and not digital. So, so there is quite some investment going on there, and of course, the payback of that will take some time, but it's the only right thing to do for a brand like Adi. So you also have to be a little bit patient, but the product is there. That's clear. Thank you very much. The next question comes from the line of Erwan Rambourg with HSBC. Please go ahead. Yeah. Hi, good afternoon, gentlemen. I hope you can hear me okay. I had one for Bjørn and one for Harm. So, Bjørn, one on China. I just came back from China about three weeks ago, and there's a lot of talks of Western brands taking back share from local Chinese brands after, you know, pretty much two and a half years of misery. I'm wondering if you could comment on that. How easy is it now to operate in terms of brand ambassadors, in terms of events? Is there a role, you know, post the Yeezy restructuring? Can you comment on inventory levels, specifically in China? And last year you were down 50% in Q4, so what can we expect both short term and long term for that market? So that's for you, Bjørn. For Harm, I was just wondering, on the gross margin, levers, you talked about freight input costs, promotional activity, FX. I'm just wondering if you can comment on timing of when some of those start to turn. You know, the, the FX pressure, how long will that last for? The promotional activity, it seems that leaving aside the U.S., that's going to temper somewhat, but can you help us understand the building blocks to think about gross margin in, again, the short and the, the longer term from here? Thank you. I'll start. On the China situation, I think we need to divide the lifestyle business and the performance business. When it gets to the performance business, it's obvious that the local brands has built a price point for running shoes, basketball shoes and all the performance shoes that is below what, for example, we are offering. That means we have been competing in running, I would say also in, in basketball, in a smaller part of the market because our price points has been high. And if you want to have real volume, I think you need to go down and also do real performance shoes at sub-$100 price points. That's what we are going to do to compete for a bigger part of the consumer. The rest, I mean, the higher end is starting to grow again, but that market is smaller than you might expect. On the lifestyle area, you know, we've been lagging the, the, what should I say, the opportunity to actually work with celebrities coming out of music or out of art or out of whatever, and that has changed in the sense that we now are starting to activate again, actresses, actors, musicians, I would say, street culture-relevant people, for example, in break dance. So far, all these activations has been working without any shitstorm from any, what should I say, communities. How long that will last, and is it forever? We don't know, but the team is very energized by actually starting to compete again on a fair level compared to local brands. You saw that our underlying business was up 10% for the quarter. And again, our own concept stores, where we actually have the best of the best, is actually much higher than that. So, so there is clearly, what should I say, a consumer that goes back again to adidas on a higher level, than it was a year ago. I think when you look at Q4 in China, you have to be very careful because there's many movements in the wholesale business there, with takebacks of inventory and how do you actually push in products for Q1 and not so.... I'm not going to give you a number, but the Chinese number will actually at least be up double digits, regardless how high it's going to be. And it's the same thing there. We will see how 11.11 goes, which, you know, we are in the pre-selling right now, and then we will adjust, you know, all our wholesale business according to what we see. We will not push anything into the market in Q4, I can promise you that. And then, of course, we will hope that the market will continue to develop the way it should. We will over-invest in marketing and then continue to see a growth in the Chinese market, but not to try to get it very, very quickly up to the previous levels, because the risk then again is of course that it crashes. We have moved 75% of our volumes to local sourcing, and we are doing 30% of our product at what we call quick response replenishment. So the pre-orders that we're taking with all our partners is going down substantially because we don't want to push it in and take back. We want to deliver in and then replenish both with new product and with old products. So the business model is just changing, and I think if you ask our local team, they're very, very happy with the way we're developing when it gets to the business model. And with that, I hand over to Harm. Yeah, Erwan, on the, on the gross margin, very good question, and of course, I'm not gonna give you any guidance for next year, but you can assume that FX is probably the only drag, you know, going into next year. And that FX is probably more negative in the first half, and then it's turning, turning neutral and maybe even positive in the second half. That's where we are from an FX point of view. When it comes to all, all the other elements, freight will be, you know, positive for the full year, probably more positive in the first half, and then more neutral in the second half as well. And then, of course, as we, as Bjørn alluded to, have a more trajectory with our Terrace product and lifestyle. Overall, lifestyle presents ourselves with an attractive margin. So the overall business mix, you know, will turn positive as well, and this is where we look into next year. So the combination, freight positive, given the scaling of some of the products that we have, we hope for a normalizing our benefits on the production cost as well. So, simple terms, FX is a negative next year for the full year, more the first half than the second half. Everything else should turn slightly positive. That is also something where we believe in the midterm, we always said we want to get to a 50% or plus margin, and that's required. If you look at our Q3 again, you know, if you get to a 50% margin with some of the drags, you know, going away over time, we would plot a 50% margin already, and then, having a normalized infrastructure given the growth that we have on the top line, we have shown in Q3 what's possible, and we can build on this one. So that's roughly where we are. Thank you so much. Best of luck. The next question comes from the line of Zuzanna Pusz with UBS. Please go ahead. Good afternoon, everyone. Thank you for taking my questions. I'll stick to two. So first of all, maybe to follow up on gross margins. Thank you, Harm. That was very helpful to understand the drivers for next year. But I also wanted to follow up and see how we should think about the gross margin in Q4, because obviously we're coming from an extremely low base which had many one-off items last year. So I mean, it was, I think, 39% last year. So I was just wondering whether, you know, the Q3 FX is the right way to sort of think about the gross margin or what are sort of the puts and takes we should consider when we look at the Q4 gross margin? And then a question, maybe just for Bjørn on the performance in Q4. And I think it's very clear, and I understand that you say you don't wanna pull forward any business into Q4 because, you know, that's not the point of your strategy. But if I'm not wrong, I think the business in Q4 tends to be a little bit more retail-driven, at least has been as in the last two, three years. So I was just wondering if you could maybe comment on the current trend you're seeing. I think some of your peers have mentioned that actually, weather had a negative impact on, at least for them, on Q3, and October was seeing an improvement. You know, any comments you could make on how, sort of, you know, retail is developing so far, if that's sort of double-digit growth you're seeing in your own stores is something that could continue into Q4? That would be very helpful. Thank you. You know, Q4, I think historically with adi, and it was the same in Puma, it was almost never a profitable quarter because there's so many movements. And where we're sitting right now, we will have improved business in our D2C when it gets to the sell-through of the product on full price. I'm 100% sure, because we see that trend already. But you know that 2/3 of our business is a wholesale business, and for us to get into a more structured business and not, what should I say, hunt the business that is in demand, we would rather have the pre-orders for Q1, Q2 be fulfilled in a way that we can plan the business than now trying to stress Q4. And that's why, to be very honest with you, for the story of adi going forward, how we perform in Q4 doesn't really matter. I hope you agree, and that's why we're very relaxed on what numbers we're showing. And again, we can talk about it at the end of the quarter, how our sell out and how, you know, our new franchises is working, and I'm very convinced they will do well because they're doing well also in October. But in the big scheme of things, then what do we do? We take back some retailers, and how do we, what should I say, deliver maybe demand that is there out of the order book of Q1? I think we've been very careful. And then, you know, the, what should I say? The whole year-... is also that we could easily have said, let's make a drop in Q4 so we look good, but we're not doing that because we have to really build stone by stone and do the things that are right for the business into 2024 and 2025, and we will do that also in Q4. The demand for the new product is actually very good. So, you know, the sell-through thermometer on what is hot is good. And we also clearly see, you know, a demand for Three Stripes now also going into apparel, which, you know, the halo effect of what's happening on the footwear side. And again, you know, the order book for Q1, Q2, which wasn't that great either, is now building. The order book for Q3, Q4 will be very good. And then the question is, how much stress are we putting into this to short-term, you know, try to impress you? Or are we now trying then to do what is right for the business, also going into 25? And, and you know me, that we're now trying, you know, to promise you things that we can deliver and making sure that we build stone by stone. And that's why Q4 looks the way it does, so. And then I hand over to Harm for the margin. Yeah, so then when it comes to the Q4 margin, unfortunately, I'm not going to give you a lot of more detail than what you heard before, but the key drag in, in Q4 will be, again, there's no easy business planned. And then secondly, there's significant FX, you know, headwind that is coming towards us. But you also need to understand, given where we are after nine months and having made some progress also on the underlying business and made tremendous progress on the inventory side, on the total level of inventory. Now, looking into 2024, we want to make sure that we do the utmost in Q4 to have a higher share of good product, rather those, you know, bad product in the inventory, and that's where we take advantage of it, and then get better prepared for, you know, Q for 2024. That's the plan, and I will leave it there. Thank you. The next question comes from the line of Jürgen Kolb with Kepler Cheuvreux. Please go ahead. Thank you. Bjørn, first question for you, again, around the order book, and thanks for mentioning also Q1 and Q2 order book. When you last time talked about the order book for the H1 next year, it sounded at least as if that's a negative one that was down because of especially very reluctant retailers, specifically coming from North America. And I was wondering, as you said, this is building. Are we in positive territory, especially, also maybe with a little bit more optimism coming from North America? Moving on to the second half, very strong, as you pointed out. Maybe one indication on price and volume. Is, is there a price component included in this order book, or is it more like for like, and again, also here on North America, if you could give us an indication if, you're seeing good demand from North America also in the second half. And the second part of the question, Fear of God, good news, it's coming to the market. I was wondering if you could share with us, some thoughts as to why that took a little bit longer, and, if maybe any of the plans related to, that category has changed, or if that still is, as initially planned, but just a little bit of, delay here and there. Thank you. Well, the Fear of God thing, I think is a good example for working with a partner, and not having a clear set up what is expected. You know, I wasn't part of the first two years of this, but I've been part of the last year, and I think it's, you know, wrong expectations. And again, not having the L.A. office up and actually a lot of misunderstandings of what it means to work on a performance product and then on a lifestyle product with a guy like Jerry Lorenzo. That's now fine. I mean, as I said, there's about 42 articles that has landed in the warehouses. There's performance products ready to go, on the pitch or on the floor. There's lifestyle product, both in apparel and footwear, ready to go. So I think those problems are over. And now it's for us to get the heat going and then commercialize it. And from the feedback from retail and also from the fashion show in LA, it's been actually very, very positive. When it gets to the order book, I think it's fair to say that the order book for Adi has been negative and heavily negative for a long time, especially for the second half of this year. When we started, there was a terrible order book, and we have been able then to replace that with replenished business and then, of course, also pushing, you know, the lifestyle things that has worked and changed the business. You remember I said to you, we need to fight, and we found the things that we could fight with, and I think the team has done a great job. The order book, initially for the first half, as I told you, of 2024, was also negative. That's now starting to build to a positive order book. And I expect the order book for the second half of 2024 to be very good, positive. I'm very careful with the order book in the U.S. because the order book there doesn't really mean anything other than we need to go by account and look at what inventory do they have, and if we give them a positive order book, then we need to make sure that we either have clearance plans or that we take inventory back. Because it doesn't help to have a high order book and then deliver into a store that is full of old merchandise. So U.S. is lagging, I would say, six months behind the development that we see all over the world, not from a heat on the product, but from an inventory level in general, and the amount of discount also on adidas product, but not only adidas. So, so again, if I should build a scenario, I think when we end the year, we will have a positive order book globally for Q1, Q2, and we will have a very good positive order book for Q3 and Q4, and then we will see how much we then have to chase on top of that order book. The growth numbers on the five shoes I showed you in the presentation is, of course, much, much higher currently than the trend that we have in the order book. And we are actually not taking orders on many of the franchises because we want to manage it. So this is now, you know, a course also for us to show that we can be disciplined and not overheat some of the franchises. But again, I'm extremely proud of the team, what they have done for go-to-market for Autumn/Winter 2024. The way we have treated the customers, the way we have now done all the pre-lines, the quality of the samples, the amount of samples. I think all retailers worldwide will say, "Wow, the service we feel now from adidas is great." I think they want to do more business with us, and that was the goal nine months ago, to get there. Then we will have to show that the product we are doing is also selling. Knowing that our D2C business in the full price stores is up already, like for like double digit, that gives us a good, what should I say, indication that the right product in the right location with the Three Stripes and our logos works. Very good, understood. Just a quick one on pricing in the order book. Is there a component of price increase or is it rather, flat? Well, it's obvious that if you're- I think I showed you that the growth in our lifestyle business is in Originals, higher than on Sportswear, then it's obvious that right now the order book is on a higher price. But that also has to do that we haven't chased the order book yet on the more commercial side, the way we should probably. So right now, I would say that there is a higher demand on the higher product, but that's not necessarily because the demand is like that from the retailer, it's more the way we have, you know, been able to sell it. You know, any trend we do upstairs, like all the terrace shoes, also have takedowns. And we are in this crazy situation that the higher end has much higher orders now than the lower end. Of course, in a normal franchise, that's not the way it is. This is more to do with where we are in the cycle. As you go through next year, I think you will also see that the lower end and the Sportswear side will start to grow as we scale up the same silhouettes. So this is more a just a view if you look at it right now, but we don't see average price increasing as much as it currently looks in the Order Book. That's a nice problem to have, the higher price- Well, yeah. Higher demand. Fair enough. Yeah, but you would like to do both, right? So there is a good thing and a bad thing. So it's like, in a perfect world, you would do both, and then we will be closer to our 10% EBIT, right? You have to remember where we're coming from. So it is good right now that we, in all categories, have higher demand on the higher price. I agree with you, because that's the same as we have in running. But of course, you need to commercialize it. So there is a job to do to get where we want to go. But Rome was not built in nine months, so we need a little bit more time. Excellent. Thank you very much. The next question comes from the line of Geoff Lowery with Redburn. Please go ahead. Yeah. Hi, team. two questions, please. Firstly, can you give us some feel for how many units associated for Terrace you will have sold in 2023, do you think? And the second one is a slightly bigger picture question: How far are you in getting the wider management team where you want it to be? I don't know whether you think in terms of top 50, 80, 100 leaders in the business, but how deep and full is the bench right now? Thank you. The terrace is millions of pairs. I think I have to be careful with mentioning the exact number, because there's also an uncertainty what is terrace or not terrace. But the court side will be tens of millions of pairs when you get through 2024. It's a big, big category. If you look at the team, also a difficult question. I mean, you've seen that we have changed most of the board, so that is a check. Then, you know, when it gets to the rest of the team, there are changes. You've seen a couple of them today. And of course, there will continue to be changes, but most of those changes is actually elevating internal talent. I think what we have seen is that we have a lot of good people in the second, third, and fourth string internally. And the goal is clearly to recruit less outside, but then to give our, what should I say, talent that I just hold back, the chance to get into higher position. And I'm very, very impressed, actually, from what I've seen, the nine months, how much talents we have. And again, you know, give us some time, and then we will look at structure again during 2024. You have to remember that this year was about attitude, and what should I say? Take away a lot of hindrances and breaking rules to get quicker and go to market quicker. We still have a lot of work to do when it gets to actually formalizing that into processes and structure. But you know, attitude and results first, and then you can make it more professional afterwards. Great. Thank you. The next question comes from the line of Edouard Aubin with Morgan Stanley. Please go ahead. ... Yeah, good afternoon, guys. So just, so one question on China, one question on sales next year. So on, on China, Bjørn, so just some clarification on the back of what you just, mentioned earlier. The Neo line, are you looking at completely, you're downsizing the business, are you looking at completely kind of discontinue, this line in, in, in China? And also related to what you have said in the past, in terms of, you know, designing product in China for China, I think you gave the, the, the target of about 30%. Kind of, if you keep, give us an update in terms of that, that objective and, and kind of why and come back on why the need to design product locally, in China. And then just lastly, related to that, you know, is the push kind of designed, you know, to compete more with the Chinese brand in lower tier cities? Or, you know, would you rather compete more with Nike in higher tier cities, or you basically want to compete with everyone in China? So that's all for China. And then just on next year, so you kindly commented on the order book. If I look at your total company sales next year, you know, I think consensus is looking for about 8%. You're gonna lose the benefit of Yeezy, which is adding, I think, 3% or 4%. So basically, you know, consensus is assuming kind of a very low type of double-digit type of growth next year underlying. Do you think that's kind of, I know it's a bit premature, you're not, you're not gonna give us any exact figure, but is it in the realm of possibility, a low double digit organic growth, given what you've printed this year or, or not? Thank you. First of all, China. All products in China are different than the product you have in a different market on the apparel side, because they have Chinese spec. So the sizing and the spec are different, even if the product looks the same. So you have to think about it, the product is different anyway. And what we have said is that, if it's different anyway, then why don't we let the Chinese decide also more on the design? So we have now 50 designers sitting in Shanghai, which has the freedom to add, supplement, or create something that we haven't done before in apparel, from all the collections. If that is 30% or 40 or 20, I don't really care, it is, you know, the Chinese organization that is deciding on that. On footwear, it's a little bit different, but on footwear, we can produce locally all styles also in China, which is an enormous advantage. And that's why also there, we give the Chinese the possibility then to add SMUs, material components, do changes to the collection and produce it locally, which on the landed cost could be cheaper, no duty. And, of course, from a lead time, when it gets to both transportation and production, gives them advantage. That's why we're stopping this, you know, selling in as much as we can and take back what we cannot sell, to a planned business where we say that we only sell in 70%, and then the rest, we actually will replenish or put new product into the store during the season or the quarter. So this is a new kind of way of working. When it gets to the market, I think on the performance side, we have been competing, I would say, only against the Western brands, and then you're right, especially Nike. But the local brands, the Li-Nings, the Antas and stuff, have created, I would say, performance segments underneath EUR 100, which still people are running marathons and playing basketball with. And I think that's a market that we strategically now are looking at to build, I would say, high technology product, but at the price point, also below what we normally would do for the Chinese market, to make sure we're competing for a bigger piece of the pie. When it gets to the cities, we are obviously competing in the major cities, you know, that's where we, lifestyle wise, I think for a long time, a market leader. And that's something we want to grab back again, and there we are competing both against Nike, but also other brands. And in the lower tier cities, you know, the distribution is thinner. We have closed, I think, about 3,000 stores with our partners, to kind of clean up, a lot of bad distribution, and that's where Neo played a big role. So currently, Neo will be reduced to a very, very small part of the business. The brand, Neo itself, will then disappear, and then we will have partners that will then attack the smaller cities, with, you know, a special offering, but in a much more narrow process than what we used to do. So it is a little bit more details than what you asked, but in general, you will say, "Yes, Neo will disappear." We will find or have found retail partners that will attack the smaller cities with a specific range. And then we will focus, you know, with our major partners than on the bigger cities and D2C. Don't forget that our D2C business in China is pretty low. We will try to balance and optimize the offering as good as we can. You know, you have a tendency to try to get a top-line guidance, and that's the way you set up the question. Of course your math is correct, but it's very difficult now to say, are we shooting for 7, 8, 10 or 12%? As I said, the first half... Again, we haven't even decided what to do with Yeezy. The first half will have a lower growth than the second half, just naturally. That's because the order book, of course, is building as we go from quarter to quarter. The U.S. market is lagging behind and will probably not grow at all in the first half. I think we can look at some growth in the second half. And then, of course, it depends on what we do with Yeezy. But underlying, we will have growth, for sure. But I think we should prove to you that, again, the growth that we are having is a profitable growth, and it's a growth that we can build on, instead of trying again then to convince you with some numbers and then run into overheating the market again. Right now, I think the demand for the second half is going to be very strong, and then the question is: how do you face the first half, and how do we make sure that we don't overheat franchises, but that we manage them properly? I hope you saw that, you know, TERREX, then into Campus, then into Superstar, then into Seventies Running, and then we have a new lifestyle running products behind that. And then all these trends, you will then in what should I say, copy down to all the price points. So, we have all the ingredients that we actually need to improve during 2024. But remember, the goal is to be really profitable in 2025 and 2026 and not try to overheat in 2024. Thank you. Andrea, we have time for two more questions, please. The next question comes from the line of Andreas Riemann with Oddo BHF. Please go ahead. Good afternoon. First question on Fall/Winter 2024. You said this is the first collection from you and the team, Bjørn, and we know you want a more local product, you want a bit more wholesale, you want to cover more niche categories. So what strategic aspects are already reflected in this Fall/Winter 2024 product? This would be the first question. And somewhat linked to that, my second question: other than China, what are the countries where you see the biggest need for a more local adidas product? Thanks. Well, I think what I tried to say is that, the 2024 autumn range is the first, what should I say, range that we go to market in a way that I think is right. Remember, I've been here for nine months, so actually setting that up with, what products are we showing, what customers, how do we show it, how do we sample it? What kind of dialogue have we had with the retailers before we make the collection? How do we go with SMUs, and how do we go with in-line product? I feel that Autumn/Winter 2024 is closer to what I see as optimal, and it's the first, what should I say, go-to-market process, where I can say, "Yes, this is the way adidas should be," and, and, and I feel good about it. The other quarters before that was chasing business to fill a gap, because the order book goes down heavily. So, so that's why I'm saying I feel comfortable sitting, looking at Autumn/Winter 2024, because I've seen the reaction, I've been in many of the meetings, and with everything we see in the market, God forbid that the world goes into a, to a crisis again, I feel good about that. When it gets to the markets where we need local products, I mean, you definitely need it in India. I don't know if you know, but the Indian government has put a new regulation that actually forces you to do a lot of local sourcing, and when you do local sourcing, why then, then also do local product? I mean, there's no need to force designs on people when you have to source it there anyway. Then you can also try to do designs that is committed to that market. So India will have a lot of local. China, we already talked about. Then there are, you know, needs, especially in Japan and Korea, to do trend stuff in a different way. And then I think the big difference and the biggest discussion many retailers have, and I guess brands, is what is the difference between the U.S. and Europe? And we know that American street culture is different than the street culture in Germany. What should I say? The basketball and hip-hop influence in the U.S. is different than what it is in Europe. The differences are bigger than you think, and that's why, for us, we have set up this process and the office in L.A. to target very specifically the street culture in the U.S. If that product then can go to Europe, fine, but if it doesn't, then we develop product also here. So in the future, the sum of, I would say, what we do in China, what we do in India, what we do in Korea and Japan, and what we're doing then in Herzogenaurach, together with L.A., L.A. is then the total of what we do. And then the balance, how much is then global and how much is local, doesn't really matter because we have the resources. It's mainly different factories. And again, I think that we can get closer to the consumer, and we can get quicker when we do it that way than trying to sell one collection to everybody. So I don't think there's a big disagreement on this, and I think the retailers in the different areas loves us for doing this approach. So I hope that answers your question. Yep. Thanks for that color, yep. The last question comes from the line of Cristina Fernandez with Telsey Advisory Group. Please go ahead. Hi, thank you for taking my question. So following up on that comment around the U.S. market and consumer, I wanted to ask: how do you feel about your wholesale distribution as far as the doors and the points where you are in? If you think about the strategy, do you feel like you need to make changes to the partners where the product is showing up at? Well, again, all good retailers should have more adidas products. That's number one. I think that the share we have with some of the retailers is far too low, and that is a consequence of, you know, us focusing on D2C. And also, I don't think during the last couple of years, focused enough to work with them. That's changed dramatically. Most retailers that you know in the world are interested in a strong adidas, and that's why I feel that, you know, the feedback we have with them. And the process we've had with them over the last nine months has developed more and more positive. But again, the real result of that is first visible in autumn, winter 2024, because that's the timelines that you're working to, and that's why I'm very optimistic about the order book. I think we will see growth in the wholesale business also in the first half, but then less than what you see in the second half. There are segments of retail that we have totally, what should I say, gone out of? I mean, running specialty is one of them, where, you know, we divested from physically servicing them, and we thought we could do it only digital. We're changing that. The good thing is now we have the product. As I said, I think we have the best running product in the high-end market, but we lack distribution. So, that is, you know, one area that we need to win back again. There are areas in specialty sport, tennis, for example, where we need better distribution, where we have the product, but it's almost not visible. And then in the U.S., all the U.S. sports, if you do American football or you do basketball or you do baseball, it's obvious that we from a performance side, you know, both distribution-wise and what should I say, partner-wise, have a lot to do. When it gets to all other general sports distribution or sports fashion, I think we're working with all the partners. It's just that they haven't felt that we service them properly, and that's why the share of the wall is not what it used to be. With many of these retailers, we have half of the SKUs on the wall now than we had 10 years ago. The good thing is, I haven't met one retailer yet who doesn't say that they wanna grow fast with us, and it's now up to us then to show that we can give them the product and the marketing and the heat they need, so they can make real money with us. Because, remember, the only reason for a retailer to buy a brand is that they can make money with us, and that's what we're trying to do, and over time, I'm very, very convinced that that will happen. Thank you. And I've got one other question I had was on the inventory. Now, if you're not gonna have a Yeezy drop in the fourth quarter, do you still expect improvement in the terms of year-over-year decline in inventory? Or from here, it's really more about the composition of the inventory until you decide what to do with Yeezy? If you take Yeezy out, you have EUR 4.5 billion in inventory. I think that's a healthy level. There is, of course, some over-inventory still in the U.S., but that's, you know... I would say if we can keep this inventory level but have a high quality of the inventory, I think we will be in good shape. And then remember, in our guidance, you know, it is then the assumption that the Yeezy inventory is going to be written off in the current status, right? And we will make, you know, all the necessary analysis to see how we will treat that inventory. And should we decide that we will sell it, then, of course, we will not write it off. So that you also have to have in your mind, when you look at the value of the inventory. All right. Thanks very much, Cristina. Thanks very much, Andreas. Thanks very much, Bjørn and Harm, and also thanks very much to all of you for joining the call on this very busy day and for mostly sticking to the two-question rule. This concludes our Q3 2023 conference call. If you have any open questions, be it today, tomorrow, or over the next couple of weeks, as always, please feel free to reach out to Philip or myself. We will be happy to connect with you, and with that, thanks very much again. Have a good remainder of the day. All the best. Bye-bye, and take care. Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.