Deckers beats and raises guidance, but shares fall 6% on margin fears

HOKA revenue rose 7.7 percent to $703.5 million in the first quarter of fiscal 2027. Parent Deckers Brands said early reorders for the newly launched Clifton Pro support its view that the brand can sustain low double digit growth for the full year, even as analysts warn rivals are moving more aggressively into the cushioned running segment that helped build HOKA’s business. In a note published the same day as the results, Evercore ISI flagged Nike’s spring 2027 lineup and On’s Surreal foam platform as direct challenges in a segment HOKA has led.

Deckers tops $1bn in Q1 as DTC outgrows wholesale

Deckers net sales topped $1 billion in a first quarter for the first time, rising 5.7 percent to $1.02 billion. Growth diverged by channel. Direct to consumer sales jumped 13.0 percent to $352.8 million, while wholesale increased 2.2 percent to $666.7 million. The company said the gap reflects shipment timing tied to a European warehouse transition rather than softer demand. UGG net sales rose 4.9 percent to $278.0 million. Other brands, weighed down by the wind down of the Koolaburra label, fell 18.1 percent to $37.9 million.

HOKA leans on DTC momentum as EMEA reorders hit a record

At HOKA, direct to consumer revenue grew 17 percent globally versus wholesale growth of 3 percent. Executives said the split reflects planned international shipment timing rather than weaker sell in. Trail and lifestyle franchises, including Speedgoat 7, Mach 7, Mafate Speed 2 and the Skyward line, accounted for more than half of HOKA’s direct to consumer growth in the quarter. President and Chief Executive Officer Stefano Caroti said the brand is gaining share in performance running and trail above $120, a higher price band than HOKA has traditionally targeted, and cited a record quarter for reorders in EMEA.

A closer look at the P&L

Gross margin expanded 60 basis points to 56.4 percent. Chief Financial Officer Steve Fasching said on the earnings call that better management of product closeouts added 60 basis points, while full price selling and channel mix added 110 basis points and favorable currency contributed 40 basis points. Those gains were partly offset by a 150 basis point drag from tariffs paid this year that were not incurred in the prior year quarter.

Selling, general and administrative expenses rose on new hires, marketing and higher rent tied to HOKA store expansion, pushing operating income down 6.0 percent to $155.3 million.

HOKA still on track for double digit growth, but shares fall on tariff and timing doubts

Deckers Brands raised its full year guidance for diluted earnings per share to $7.35–$7.50, a five cent increase, on stronger gross margin. HOKA is still expected to grow in the low double digits and UGG in the mid single digits for the year, with growth accelerating in the second half as wholesale shipment timing normalizes. The company also raised its assumed go forward tariff rate to 12.5 percent from 10 percent and continues to exclude any tariff refund from its outlook, even as it pursues recovery tied to the IEEPA tariff ruling.

Shares of Deckers fell 6.09 percent to $96.23 in regular trading yesterday and slid further after hours. Investors appear to have weighed the second quarter gross margin warning on tariffs and freight, and a flat consolidated revenue range whose midpoint trailed some analyst models, more heavily than the raised full year profit guidance.