Deckers Brands delivered a strong start to fiscal 2026, with first-quarter revenue climbing 17% to $965 million as both HOKA and UGG exceeded expectations. The footwear giant’s earnings per share got a 24% boost to $0.93, demonstrating the ongoing strength of its premium brand portfolio despite an uncertain retail landscape.
HOKA posted a 20% revenue increase to $653 million, while UGG delivered its largest June-ending quarter in history with 19% growth to $265 million. The company’s smaller brands, including Sanuk and Teva, faced headwinds with a 19% decline year-over-year to $46.3 million.
“In the first quarter, our brands gained market share while maintaining a high degree of full-price integrity,” said CEO Stefano Caroti on the company’s earnings call on Thursday. “During this period of key model transitions, we continue to make disciplined and strategic investments in our brands and our teams manage spend in other areas of the business to provide flexibility.”
Channel Strategy Reflects Consumer Behavior Shifts
Deckers’ overseas revenue surged 50% while domestic sales dipped 3%.
Wholesale channel sales increased 27% to $652 million, while direct-to-consumer sales remained relatively flat with a modest 0.5% increase.
HOKA experienced record quarterly wholesale reorders in Europe, while China continued to show strong growth momentum. This global expansion is supported by strategic partnerships with retailers like Intersport, Sport 2000, and the JD Group, Caroti said.
“From a U.S. wholesale perspective, performance continues to reflect our disciplined approach to marketplace management,” Caroti said. “HOKA is driving revenue growth from increased selling in additional doors with key partners to satisfy greater in-store demand and reorders as sell-through in the channel continues to outpace revenue growth.”
The company’s wholesale success highlights a strategic shift in consumer behavior, where shoppers increasingly prefer brick-and-mortar locations for premium purchases, even as they research products online, he said.
HOKA’s three largest franchises – Bondi, Clifton, and Arahi – are showing strong consumer reception following recent updates. The newly launched Arahi Eight has generated particularly positive early feedback, with double-digit weekly sell-throughs in EMEA and significant volume gains in China.
UGG’s growth was driven by international markets, men’s footwear expansion, and successful seasonal collections. The brand’s 365 initiative, focusing on year-round relevance through sandals and sneakers, contributed meaningfully to the quarter’s performance.
Navigating Trade Uncertainties
Despite strong performance, Deckers faces headwinds from evolving trade policies. The company expects approximately $185 million in unmitigated tariff impact for fiscal 2026, up from previous estimates of $150 million, due to the impact of trade agreements with Vietnam. Management has implemented selective price increases and is working with factory partners to offset roughly $75 million of this impact.
“Given the continued uncertainty from evolving global trade policy and related macroeconomic pressures, the company will only be providing second quarter guidance,” the company stated, projecting Q2 revenue between $1.38-$1.42 billion.
For the second quarter, Deckers anticipates HOKA growth of approximately 10% and UGG growth in the mid-single digits. Gross margins are expected to face pressure from increased tariffs, promotional activity, and higher freight costs, partially offset by price increases implemented in July.
The company’s strong balance sheet, which includes $1.7 billion in cash and no debt, provides flexibility to continue investing in brand building and global expansion while returning capital to shareholders through its active share repurchase program.
