Deckers Brands, a renowned player in the apparel and footwear sector, has announced a 7.1% increase in net sales for the third quarter of fiscal year 2026 (Q3 FY26), achieving $1.95 billion compared to $1.82 billion during the same period last year.
When adjusted for constant currency, net sales rose by 6.8%. The financial results for the quarter ending December 31, 2025, also revealed an uplift in diluted earnings per share, rising from $3.00 to $3.33.
The significant growth was largely driven by the HOKA brand, which saw an impressive revenue increase of 18.5%, reaching $628.9 million. Meanwhile, the UGG brand reported a 4.9% rise in sales, totaling $1.305 billion. In contrast, the performance of the other brands within the company declined sharply by 55.5%, falling to $23.2 million, partly due to the gradual phase-out of Koolaburra’s standalone operations.
Analyzing the distribution channels, wholesale net sales rose by 6% to $864.6 million, while direct-to-consumer (DTC) net sales experienced an 8.1% increase, hitting $1.093 billion. DTC comparable net sales also grew by 7.3%. On a geographic basis, domestic sales expanded by 2.7%, totaling $1.2 billion, while international sales recorded a robust growth of 15%, reaching $756.7 million.
As Deckers Brands looks ahead to the fiscal year ending March 31, 2026, the company provided an updated forecast, expecting net sales to fall between $5.400 billion and $5.425 billion. They predict mid-teen percentage growth for HOKA and mid-single-digit increases for UGG relative to last year’s figures.
During the earnings call, CEO Stefano Caroti linked these strong results to strategic initiatives and effective marketplace management that enhanced both HOKA and UGG brand performances in the U.S. and global markets—a growth he highlighted as particularly notable for HOKA.
Caroti stated, “Our strategic marketplace management fuelled balanced growth in DTC and wholesale, inclusive of continued international momentum as well as healthy growth in the US across both channels. UGG and HOKA each delivered high levels of full-price selling, resulting in strong gross margins. We are on track to deliver another incredible year, with profitable growth at two premium and differentiated brands that operate in expanding segments of the global marketplace.”
CFO Steven J. Fasching discussed the emphasis on balancing wholesale and direct-to-consumer channels to foster sustainable growth. He underscored the importance of strategic inventory management and leveraging DTC operations to enhance consumer engagement while maintaining robust full-price selling.
FY26 Outlook
Looking forward into FY2026, Fasching acknowledged potential risks such as shifting macroeconomic conditions that could affect consumer confidence, variations in discretionary spending, inflationary pressures, and changes in foreign currency. However, he expressed optimism in the continued momentum supported by solid pricing strategies designed to mitigate tariff impacts and sustain a strong operating margin.
Deckers Brands expects its effective tax rate to remain around 23%, with the operating margin projected at approximately 22.5%. Diluted earnings per share for FY2026 are anticipated to be between $6.80 and $6.85, factoring in expected outcomes from further share buybacks in the fourth quarter.
In summary, Deckers Brands projects exceeding $1 billion in share repurchases by the conclusion of fiscal year 2026 as part of its ongoing capital return strategy to enhance shareholder value amid challenging global economic conditions.