On Thursday, German sportswear giant Adidas reported that revenues had started to return to growth levels in mainland China faster than anticipated after the COVID-19 lockout, although the restart of business in Europe and the Americas was also gradually in motion. 

Adidas kept firm on guidance it released in April for at around a 40 percent drop in second-quarter profits and a retreat in operating profit of over $112 million and stated it would provide more details with results on August 6.

All of Adidas' owned and partner-operated stores have resumed business in the country since mid-April. Late that month, chief executive officer Kasper Rorsted cautioned investors that sales in China could take several months to rebound back to pre-pandemic levels, with recovery slow rather than quick.

While store traffic in May was lower compared to last year's, however, the company said targeted measures to revive retail have resulted in sequential improvements since reopening of stores.

Following five years of double-digit growth, China has become one of the Nike competitor's largest individual markets, taking in over 20 per cent of global revenue last year. China has become an indicator for when, after the lockout, the sportswear brand and the broader consumer goods industry should return to normal.

Sales of Adidas in China plummeted by 80 percent in the lockdown peak. And while the country's footfall was still below the previous year's, the company said revenues were boosted by targeted efforts.

According to Adidas, nearly all of its stores in other Asia-Pacific markets as well as in emerging markets had resumed operations in line with the plans of company for a gradual normalization of their business. Globally, as of Thursday, about two-thirds of Adidas' fleet of shops had been at least partially open. 

Three-quarters of the company's locations in Europe had reopened, though most of the branches were still operating at limited hours. Just fewer than 50 percent of its shops had reopened in North America and Latin America.

According to Euromonitor, Adidas took almost 20 percent of the total footwear and apparel market retail sales in China last year, followed by Nike at 19 percent, Anta at 11 percent and Li-Ning at 6 percent.

While some companies look to shift production away from China, China Daily reports that Adidas China has vowed to shell out more money to boost its supply chain capacity in the country. Adidas signed an agreement last month during the Suzhou Online Dialog on Global Industrial Chain Collaboration to establish a new automated distribution center in China for its Asia-Pacific market.

The company currently has three logistics centers in the country: two in Suzhou, and one in Tianjin. The newest fulfillment center that opened last November is not at full operational capacity but can handle more than 50 million goods a year.