Deckers First-Quarter Sales Surpass $1 Billion as HOKA, UGG Drive Growth; Company Raises EPS Outlook

Deckers Outdoor Corp. said Thursday that first-quarter sales topped $1 billion for the first time and that it raised its full-year diluted earnings outlook, as continued growth at HOKA and UGG helped offset higher operating expenses.

Deckers, the parent company of HOKA and UGG, reported net sales of $1.019 billion for the three months ended June 30, up 5.7% from $964.5 million a year earlier. The company said sales rose 4.8% on a constant-currency basis. HOKA remained the biggest revenue driver, with net sales of $703.5 million, up 7.7% from a year earlier, while UGG net sales increased 4.9% to $278 million. Net sales from other brands fell 18.1% to $37.9 million.

Growth was stronger in direct sales and overseas markets. Wholesale net sales rose 2.2% to $666.7 million, while direct-to-consumer net sales climbed 13% to $352.8 million. Direct-to-consumer comparable net sales, a metric that tracks performance at comparable stores and digital channels, increased 6.8%. By geography, domestic net sales rose 3.2% to $517.4 million and international net sales increased 8.4% to $502.1 million.

Profitability was mixed. Gross margin improved to 56.4% from 55.8%, but selling, general and administrative expenses increased to $419.9 million from $372.6 million. Operating income fell to $155.3 million from $165.3 million. Even so, net income edged up to $130 million, reported as $129.972 million, from the prior-year period, and diluted earnings per share rose to 94 cents from 93 cents.

Deckers also continued an aggressive capital return strategy. The company repurchased about 3.3 million shares during the quarter for $338.2 million, at a weighted average price of $103.79 per share. As of June 30, it had about $4.7 billion remaining under its repurchase authorization. The company ended the quarter with $1.603 billion in cash and cash equivalents, inventories of $807.6 million and no outstanding borrowings. The latest buyback follows about $1.075 billion in stock repurchases in fiscal 2026.

For fiscal 2027, which ends March 31, Deckers said it expects net sales of $5.86 billion to $5.91 billion. It said HOKA is expected to grow by a low-double-digit percentage and UGG by a mid-single-digit percentage. Deckers also said it expects gross margin to be slightly better than 56.5% and operating margin to be slightly better than 21.5%. The company raised its diluted EPS outlook to $7.35 to $7.50, 5 cents above its prior forecast, and said that guidance assumes repurchasing shares equal to about 80% of projected fiscal 2027 free cash flow. “Deckers delivered a solid start to the fiscal year, surpassing $1 billion of first quarter revenue for the first time,” Stefano Caroti, the company’s president and chief executive officer, said in the press release.