Deckers Outdoor’s shares fell after the company reported its first-ever quarterly revenue surpassing $1 billion but delivered full-year profit guidance slightly below analysts’ expectations. The stock drop came despite beating earnings per share estimates and showing solid brand growth.
Record-Setting First Quarter Revenue Driven by HOKA and UGG
For fiscal Q1 2027, Deckers recorded $1.02 billion in revenue, marking a 5.7% increase year-over-year, with earnings per share at $0.94 beating forecasts by six cents. The strong performance was fueled primarily by HOKA, whose revenue rose 8% to $704 million. Growth stemmed from direct-to-consumer (DTC) demand and new releases like the Clifton Pro, which launched just weeks before the earnings announcement and already generated additional wholesale orders.
UGG also contributed to the revenue boost, with a 5% rise to $278 million. The brand’s expansion beyond its traditional cold-weather focus gained momentum, particularly through men’s products and a “365” strategy promoting year-round offerings such as sandals and sneakers. Direct-to-consumer sales jumped 13% led by HOKA’s 17% DTC growth and UGG’s 6% increase.
Profit Margins Hold Up Amid Tariff Pressures, But Guidance Misses Mark
Despite tariffs that cut gross margins by approximately 150 basis points, Deckers improved its gross margin to 56.4%, up 60 basis points from the previous year. This was supported by a favorable product mix and strong full-price sales. However, operating costs rose, with selling, general, and administrative expenses climbing 13% to $420 million, driven by investments in marketing, hiring, and HOKA store expansions.
Wall Street’s anticipation for fiscal 2027 full-year diluted earnings per share was $7.49, but Deckers projected a range of $7.35 to $7.50, narrowly missing consensus. This slight miss was enough to trigger a sell-off in after-hours trading. Investors reacted cautiously, weighing solid top-line growth against the tempered profit outlook.
