26 » Share-Based Payment

Equity-settled share-based payment transactions with employees

In 2016, adidas announced the introduction of an open-ended employee stock purchase plan (the ‘plan’). The plan is operated on a quarterly basis, with each calendar quarter referred to as an ‘investment quarter.’

The plan enables employees to purchase adidas AG shares with a 15% discount (‘investment shares’) and to benefit from free matching shares. Currently, eligible employees of adidas AG and 17 other subsidiaries can participate in the plan. Up to two weeks before the start of an investment quarter, each eligible employee can enroll for the plan. The company accepts enrollment requests on the first day of the relevant investment quarter. This is the grant date for the investment and matching shares. The fair value at the vesting date is equivalent to the fair value of the granted equity instruments at this date. The employees invest an amount up to 10% of their gross base salary per quarter in the plan. A few days after the end of the investment quarter, the shares are purchased on the market at fair market value and transferred to the employees. Thereby the amount invested during the quarter plus the top-up from adidas is used. These shares can be sold at any time by the employee. If the shares are held for a period of one year after the last day of an investment quarter, employees will receive, as a one-off, free matching shares (one matching share for every six adidas AG shares acquired). This plan currently constitutes an equity-settled share-based payment for both elements. For the component of the matching shares relating to the specific period of service, an appropriate discount is taken into account. The effects are presented in the following table:

The number of forfeited matching shares during the period amounted to 3,027 (2024: 1,375).

In  2025, the total expenses recognized relating to investment shares amounted to € 4.3 million (2024: € 3.5 million).

Expenses recognized relating to vesting of matching shares amounted to € 3.3 million in 2025 (2024: € 3.1 million).

As at December 31, 2025, a total amount of € 6.1 million (2024: € 6 million) was invested by the participants in the stock purchase plan and was not yet transferred into shares by the end of December. Therefore, this amount has been included in ‘Other current financial liabilities.’ SEE NOTE 17

Further information about the purchase of shares for the employee stock purchase plan is provided in these Notes. SEE NOTE 25

Equity-settled share-based payment transactions with third parties

In 2023, adidas entered into a promotion and advertising contract that includes a share-based payment transaction with third parties. The contract has a term of up to five years. The agreement grants a transfer of shares, which correspond up to a value of US $ 26 million. In 2025, shares in a value of US $ 15 million were transferred.

The expenses for shares are recognized over the vesting period of five years. The expense amounts to € 6 million in 2025 (2024: € 7 million).

Equity-settled share-based payment for Executive Board members

The ‘Long-Term-Incentive-Plan’ (‘LTIP’) pursues the goal of aligning the long-term performance-based variable remuneration of the Executive Board with the performance of the company and thus with the interests of the shareholders.

Long-Term-Incentive-Plan until 2023

Until 2023 it consists of annual tranches, each with a term of five years. Each of the annual tranches consists of a performance year and a subsequent four-year holding period. For this LTIP, the Supervisory Board has set financial and ESG-related performance criteria for each of the performance years.

As of December 31, 2025, the total number of adidas AG shares acquired since 2021 until 2023 as part of the variable performance-based compensation and subject to a holding period amounts to 19,573 no-par-value shares (2024: 55,208 no-par-value shares acquired since 2020). The number of adidas AG shares acquired by the members of the Executive Board is shown below:

Long-Term-Incentive-Plan 2024

As part of the compensation system applicable from 2024, the Supervisory Board has introduced a revised Long-Term-Incentive-Plan (LTIP) for the long-term performance-related variable compensation. This LTIP consists of annual tranches with a term of four years each. The performance period is three years. The LTIP Bonus granted has to be fully invested into the acquisition of adidas AG shares after deducting applicable taxes and social security contributions. The shares acquired are subject to a one-year lock-up period. The LTIP payout amount is considered earned only after expiry of the lock-up period and only then can the Executive Board members dispose of the shares. The performance criteria determined in the LTIP comprise operating profit, relative shareholder return compared to the DAX, and two ESG targets.

Share-based payment arrangements, particularly those linked to the Total Shareholder Return (TSR) metric, are recognized with a fair value. This model ensures that awards under the LTIP made to employees are valued accurately at the grant date and expensed over the period they vest.

To assess the fair value of share plans tied to the TSR, the company used a Monte Carlo Simulation model. The TSR metric considers both share price appreciation and dividends paid, providing a detailed measure of the returns delivered to adidas shareholders relative to the DAX.

Key parameters in the Monte Carlo Simulation are:

• The expected volatility of the adidas AG share. Historical share price data is analyzed to estimate the fluctuation of the share price over the vesting period.

• The risk-free interest rate, which is usually determined by yields on government bonds with a term that aligns with the vesting period of the LTIP.

• The anticipated dividends that shareholders may receive during the vesting period are factored into the simulation, which influences the total returns calculated in the TSR metric.

• The duration over which the TSR is measured.

A substantial number of simulation scenarios for TSR are generated to capture a wider range of potential outcomes for future share price movements. The expected value derived from the Monte Carlo model is a combination of TSR simulations and expectations on the other non-market KPIs which are regularly updated in their entirety.

The expected value of adidas LTIP as at December 31, 2025 amounts for the 2024 LTIP tranche to 120.3% and for the 2025 LTIP tranche to 100.3%.

The annual LTIP tranche (‘Grant Amount’) is paid to the Executive Board members after the end of the performance period and after approval of the consolidated financial statements and is to be fully invested by the Executive Board members in the acquisition of adidas AG shares. Only after the end of each holding period can the Executive Board members dispose of the shares.

Cash-settled share-based payment transactions with employees

Long-Term-Incentive-Plan 2017 to 2024

In 2017, adidas implemented a Long-Term-Incentive-Plan (LTIP), which is a share-based remuneration scheme with cash settlement. ‘RSUs’ (‘Restricted Stock Units’) are granted on the condition that the beneficiary is employed for three or four years by adidas AG or one of its subsidiaries in a position where they are not under notice during that period. In exceptional cases, RSUs can be granted with a minimum term of employment of one and two years.

The total value of the cash remuneration payable to senior management is recalculated on each reporting date and on the settlement date, based on the fair value of the RSUs, and recognized through an appropriate adjustment in the provision as personnel expenses that are spread over the period of service of the beneficiary. Furthermore, social security contributions are considered in the calculation of the fair value, if appropriate for the respective country regulations and the seniority of the participants. All changes to the subsequent measurement of this provision are reported under personnel expenses.

Once a year, one tranche with a three-year term and another with a four-year term are issued. The number of RSUs granted depends on the seniority of the beneficiaries. In addition, for the four-year plan, the number of RSUs also depends on the achievement of a financial and ESG-related target. In addition, in 2023 and in 2024, the option to issue one additional tranche with a two-year maturity was exercised.

The value of one RSU is the average price of the adidas AG share as quoted for the first 20 stock exchange trading days in January of the respective financial year.

New Long-Term Incentive Plan 2025

In 2025, adidas introduced a revised Long-Term-Incentive Plan (LTIP) that represents a share-based compensation with cash settlement. ‘RSUs’ (‘Restricted Stock Units’) are granted on the condition that the beneficiary is employed for three years by adidas AG or one of its subsidiaries in a position where they are not under notice during that period. This minimum period of employment pertains to the calendar year in which the RSUs are granted and the two subsequent calendar years. This LTIP consists of annual tranches with a term of three years each and an annual allocation of virtual RSUs. The performance period is three years. The performance criteria determined in the LTIP 2025 comprise operating profit, relative shareholder return compared to the DAX, and two ESG targets. In exceptional cases, RSUs can be granted with a minimum term of employment of one and two years.

Share-based payment arrangements, particularly those linked to the Total Shareholder Return (TSR) metric, are measured at fair value of the liability. This model ensures that awards under the LTIP made to employees are valued accurately at the reporting date and expensed over the period they vest.

To assess the fair value of share plans tied to the TSR, the company used a Monte Carlo Simulation model. The details of this simulation model are described in this notes section under ‘Equity-settled share-based payments to Executive Board Members.’

The total value of the cash remuneration payable to senior management is recalculated on each reporting date and on the settlement date, based on the fair value of the RSUs, and recognized through an appropriate adjustment in the provision as personnel expenses that are spread over the period of service of the beneficiary. Furthermore, social security contributions are considered in the calculation of the fair value, if appropriate for the respective country regulations and the seniority of the participants. All changes to the subsequent measurement of this provision are reported under personnel expenses.

An annual LTIP tranche with a three-year term is issued. The number of RSUs granted depends on the seniority of the beneficiaries. In addition, in 2025, the option to issue two additional tranches with a two-year and a one-year maturity was exercised.

The value of one RSU is the average price of the adidas AG share as quoted for the 60 stock exchange trading days prior to the start of the performance period in January of each respective financial year.

The following table shows all outstanding RSUs from share-based compensation to employees:

The fair value is based on the closing price of the adidas AG share on the respective balance sheet date, adjusted for future dividend payments.

In 2025, this resulted in an expense of € 70 million (2024: € 80 million). The corresponding provision amounted to € 108 million (2024: € 163 million).