HERZOGENAURACH, Germany — Adidas AG will buy back as much as €3 billion ($3.7 billion) of its stock over the next three years.

The company's supervisory board on Tuesday approved a plan to repurchase the shares through May 2021, Adidas said. The first tranche will start March 22 and be worth as much as €1 billion to be bought back this year, the company said. The plans come on top of an annual dividend of 30 percent to 50 percent of net income from continuing operations, according to Adidas.

The decision is a sign of confidence as Chief Executive Officer Kasper Rorsted tries to increase sales to about €26 billion by 2020 and lift the operating margin to 11 percent by then as he chases larger rival Nike Inc. Adidas is getting a boost from the so-called athleisure trend, as well as high demand for sneakers specifically designed for cafes and clubs rather than running tracks and gyms.

While the “vast majority” of the program will be financed through cash, Adidas also intends to use some debt financing. Current authorizations allow Adidas to buy back just under 9 percent of the company stock, or 18.8 million shares, and most of what is being bought back will be canceled.

By Richard Weiss; editors: Eric Pfanner, James Kraus and Chad Thomas.