HERZOGENAURACH, Germany — Adidas AG reported earnings that beat estimates as sales boomed in China and online revenue gained.

Currency-neutral sales grew 4 percent in the first quarter, the German company said. Global sales reached €5.88 billion ($6.6 billion), ahead of the €5.8 billion average estimate. Operating profit of €875 million beat the highest estimate.

Key Insights

Adidas’s half-decade hot streak is in danger as growth has stopped in Europe and supply chain problems have flared up in North America for mid-priced apparel. Investors want more clarity on when the company can return to the faster sales growth of recent years.

While challenges loom in Europe and North America, Adidas has seen quicker growth in Asia and through digital channels, allowing chief executive Kasper Rorsted to improve the company’s operating margins and maintain 2020 targets.

Even though Adidas flagged slower sales growth in March, the stock has continued its half-decade climb, leading some analysts to warn of a possible correction. “The air is getting thinner” as the shares reached an all-time high, Volker Bosse of Baader Helvea said in an April 25 note.

Market Performance

The Herzogenaurach-based company’s stock has climbed 25 percent this year and is on pace for its fifth straight annual gain.

By Tim Loh; editors: Eric Pfanner, Thomas Mulier and John J. Edwards III.