The Hoka brand outpaced the overall Deckers Brands (DECK) business and sister brand Ugg in the first half and second quarter, as new product releases in the first quarter fueled strong growth throughout the period. However, the brand’s parent company has tempered its outlook for Hoka in the back half as the energy around fiscal 2026 new releases wanes going into the holidays.

“We probably have masked a few too many big product launches in the first half of the year, and we didn’t space them out enough. There are a few learnings from us in the transition to the model,” company President and CEO Stefano Caroti offered.

The weaker guide for both Hoka and Ugg sent DECK shares declined in the low- to mid-teens in early trading on Friday, October 24. Some on Wall Street saw the back-half outlook as weakness, while others hinted at sandbagging or a simple misunderstanding of the current market.

In comments and discussions with participants on a conference call with analysts on Thursday, Caroti said that while the first half of the fiscal year demonstrated the strength of the company’s two largest and fastest growing brands, Hoka and Ugg, the back half is expected to be affected by a more cautious consumer as the full impact of tariffs and price increases are felt in the U.S.

“Having said that, our brands are well-positioned when the consumer shows up for the holidays,” Caroti said. “And as always said, we don’t manage our business month-to-month and quarter-to-quarter. We build brands for long-term profitable, sustainable growth.” 

Hoka Brand Second Quarter
Caroti said that Deckers delivered outstanding second-quarter results that came in ahead of internal expectations on both the top and the bottom line. He said results closed out a solid fiscal 2026 first half, with total company revenue growing 12 percent, Hoka revenue increasing 15 percent, and Ugg revenue rising 12 percent, driving a 17 percent increase in diluted earnings per share.

For the second quarter, DECK saw revenue growth of 9 percent and a 14 percent increase in diluted earnings per share, clearly a moderation from the first-quarter trend, which was apparently a bit over-stimulated by front-loading of new product.

Hoka Wholesale remained the primary driver of growth in Q2, increasing 13 percent in the quarter as the brand continues to experience strong sell-in and healthy sell-through with innovative and compelling products that are resonating with consumers, according to comments from company CFO Steve Fasching.

Hoka DTC grew 8 percent year-over-year, with international momentum carrying over from the previous quarter and improvements in the U.S. business, “as anticipated.”

The CEO, who came to HQ after managing Deckers’ Europe business, called out the International business as the key driver of the overall fiscal 2026 business.

“In the first half, our International regions remain[ed] the driving force behind Ugg and Hoka revenue growth, increasing 38 percent versus last year,” Caroti shared. “Year-over-year gains were led by the Wholesale channel, in part from earlier shipment timing, while DTC [direct-to-consumer] also delivered strong growth for the first half.”

He said management continues to see progress from the company’s brand-building marketing investments in these regions, helping grow Hoka awareness and expand Ugg mind share with consumers around the world.

“I could not be more pleased with how our teams are executing our strategy and connecting with consumers who are increasingly looking to Hoka and Ugg for innovation and newness,” he added.

In the U.S., Caroti said consumer sentiment is still under pressure, but the company is encouraged by signs of progress in the business and has maintained its focus on ensuring Hoka and Ugg remain positioned for long-term success.

“The U.S. marketplace remains dynamic, with recent consumer trends indicating a heightened preference for multi-brand shopping experiences,” the CEO continued. “We believe Ugg and Hoka are prepared to acquire new consumers and gain share in this environment with consumers wherever they wish to interact with our brands, with strong brand partnerships with premium wholesalers, which help elevate our brands.”

He said Hoka sees the highest consumer adoption when people can try its unique blend of technologies, geometries and materials firsthand on their feet.

Hoka First Half Product and Trends
Global Hoka revenue in the first half (H1) increased by 15 percent versus the prior-year H1 period. Performance was said to be driven by consumer-led updates to the brand’s three largest road running franchises — the Clifton, Bondi, and Arahi — and by updates in the trail category, with the expansion and evolution of the Mafate franchise.

“Bondi, Clifton and Arahi have continued to deliver strong growth and impressive sell-through rates for the brand as consumers embrace the significant enhancements implemented by our product team,” Caroti observed.

He said the success of these top franchises helped Hoka gain market share.

Caroti cited Circana data showing that Hoka gained 2 points of market share in the overall U.S. road running category over the past rolling 12 months ended September 25 and outpaced the competition in Europe as one of the fastest-growing road running brands across Italy, France and Germany in the first half of 2025.

“We’re leveraging a multilayered approach to build recognizable icons that resonate across multiple categories and use cases, including dimensions of peak performance, everyday performance use and versatile active lifestyle,” Caroti continued. “The Mafate, Hoka’s original shoe, is the latest example of how we are aligning our products within these key dimensions. Mafate X was created to deliver peak performance through maximum cushioning and carbon plate propulsion for agile long-haul efforts on the trail.”

The CEO said the Mafate 5 was upgraded to handle all types of trail terrain, with premium performance cushioning and traction. The Mafate Speed 2 was said to have been reintroduced in the archive with an updated aesthetic to achieve a contemporary, active lifestyle look.

“This product family has already contributed meaningful growth during the first half of the year and now accounts for a larger share of total brand revenue, supported by targeted marketing initiatives that have strengthened consumer awareness, visibility and alignment with Hoka’s brand heritage,” he said.

Caroti added that marketing initiatives for the Hoka brand are designed to establish coherent product narratives that foster consumer engagement and encourage adoption across our portfolio.

“We’re seeing traction with our approach to building product families that are supported by marketing investments,” the CEO added. “This approach will, over time, allow us to further segment and differentiate the marketplace. You will soon see this product strategy evolution come to life through the Mach franchise, where we recently introduced the X3 peak performer in the lineup. And in Spring 2026, we’ll be launching the Mach 7 and Mach Remastered for everyday road running and active lifestyle, respectively.”

From a regional standpoint, Hoka’s performance in the first half was said to be driven by the strength of the International business, where the brand continues to grow awareness and gain market share.

“We tailor our strategy for each region, taking into account the unique stages of brand distribution and awareness while staying attuned to evolving consumer preferences. What remains consistent is our focus to maintain high levels of full price selling as we continue to expand our presence within the premium and elevated marketplace,” the CEO shared.

He said they were “very pleased” with the Hoka brand’s results across the board.

“Hoka has seen consistently strong gains across all International regions throughout the first half, with notable incremental revenue contributions from EMEA and China,” Caroti detailed. “In the EMEA region, Hoka is driving impressive results across all countries and segments of distribution, including market share gains and robust reorders with our specialty partners as we continue to drive double-digit growth.”

He also added that “best-in-class sell-through” with key sporting goods partners, significant percentage gains with athletic and lifestyle specialty accounts, where the brand is just beginning to build the Hoka business and broad-based strength in the DTC channel across Germany, France, Italy and the U.K., referencing the brand’s first German store opening in Berlin and a pop-up retail experience in Chamonix for UTMB.

In China, Caroti said the Hoka brand’s premium positioning and product innovation continue to drive resilient consumer demand. Highlights included new store openings in key cities attracting strong consumer interest, substantial growth in loyalty membership, particularly among females and younger consumers, industry-leading full-price selling, and sell-through rates for wholesale exceeding the goals set for mono-brand partner locations.

“As we navigate a dynamic U.S. marketplace, Hoka continues to gain market share in the athletic footwear category, and we remain dedicated to controlling distribution and driving a pull model demand,” Caroti emphasized. “There are a number of positive signals for the Hoka brand [in the] U.S. business that give us great confidence in the vast opportunities ahead for this brand with Wholesale sell-through increasing double digits in the first half.” He said DTC delivered a sequential improvement from Q1 to Q2, “maintaining a high-quality full-price business, a strong Spring/Summer ’26 season order book, and positive feedback from retailers on our fall ’26 product line.”

Caroti stressed that Hoka is a disruptive and transformational brand with the ability to capture billions of incremental dollars in global market share.

“Across both Domestic and International markets, we’ll continue to uphold our disciplined approach to marketplace management by building our DTC business and carefully exploring potential expansion into attractive wholesale channels and partnerships,” he said. “We are committed to building sustainable growth for Hoka and are confident in the strategy we’re executing to achieve this goal.”

The CEO said the brand’s priorities are driving healthy sell-through and gaining market share as they enter the fiscal second half, leveraging an enhanced DTC loyalty program to drive consumer engagement, preparing the marketplace for spring ’26 updates to the Gaviota, Mach and Speedgoat franchises, and investing in marketing to build global Hoka awareness.

Consolidated Deckers Q2 Results
Deckers reported consolidated fiscal second-quarter revenue of $1.43 billion, an increase of 9 percent year-over-year, a clear moderation from the first-quarter trend. Performance in the quarter was again said to be driven by Hoka and Ugg, with a small offset from the winding down of stand-alone operations of smaller brands.

  • Hoka brand net sales increased 11.1 percent year-over-year (y/y) to $634.1 million.
  • Ugg brand net sales increased 10.1 percent y/y to $759.6 million.
  • Other brands, which include Teva, saw net sales decrease 26.5 percent y/y to $37.2 million.
  • Wholesale net sales increased 13.4 percent y/y to $1.04 billion compared.
  • DTC net sales decreased 0.8 percent y/y to $394.6 million. DTC comparable net sales decreased 2.9 percent.
  • Domestic net sales decreased 1.7 percent y/y to $839.5 million.
  • International net sales increased 29.3 percent y/y to $591.3 million.

Consolidated Q2 Profitability & Expenses Summary
Consolidated company gross margin for the second quarter was 56.2 percent of revenue, up 30 basis points from 55.9 percent in the prior-year quarter, reportedly benefiting from price increases, favorable product mix, favorable foreign currency exchange rates, and factory cost sharing with partial offsets from incremental tariffs on U.S. goods and channel mix headwinds.

“As a result of our price increases being implemented at the beginning of July, in combination with actions to bring additional inventory in ahead of increased tariff rates being implemented, we saw a slight delay in the net headwind of tariffs and did not experience a meaningful negative impact in the second quarter compared to the prior year result,” CFO Fasching noted. “However, this is unique to the second quarter, and our expectation of net tariff headwinds in the back half of fiscal year remains largely unchanged.”

Selling, general & administration (SG&A) dollar spend in the second quarter was said to be in line with expectations, totaling $477 million, up 11 percent from last year’s $428 million, as DECK continues to “invest in key areas of the business.” As a percentage of revenue, SG&A was 33.4 percent, up from 32.7 percent in Q2 last year.

The tax rate was 21.7 percent for the quarter, compared with 24 percent in the prior-year Q2 period, reflecting one-time benefits recorded in the quarter.

These results culminated in diluted earnings per share of $1.82 for the quarter, 23 cents above last year’s $1.59, representing EPS growth of 14 percent year-over-year.

“In terms of our second-quarter performance relative to the guidance we provided in July, gross margin was the primary driver of EPS favorability,” Fasching shared. “Again, the better-than-expected gross margin result was largely driven by favorable timing of tariff-related variables unique to the second quarter, with benefits of our pricing actions flowing through in advance of the full burden from increased tariffs.”

Balance Sheet Summary

  • At quarter-end, DECK had $1.4 billion in cash and equivalents.
  • Inventory was reported at $836 million, up 7 percent from the same point last year.
  • The company had no outstanding borrowings during the quarter.
  • Deckers repurchased approximately $282 million worth of shares at an average price of $109.31 during the quarter. As of September 30, 2025, the company had approximately $2.2 billion in authorized share repurchases remaining.

Outlook
Deckers Brands provided guidance that total company revenue will reach ~$5.35 billion for the year, with Hoka increasing in the low-teens percentage versus last year and Ugg growing in the low- to mid-single-digit percentage range.

  • Gross margin is expected to be ~56 percent of revenue, with headwinds from tariffs becoming material in the back half of this fiscal year, partially offset by its mitigation strategies and normalized promotion levels in a more pressured macroeconomic environment.
  • SG&A is expected to be ~34.5 percent of revenue, reflecting a commitment to investing in the long-term opportunities of the company’s “powerful brands,” resulting in an expected operating margin of approximately 21.5 percent, which Fasching said remains at a top-tier level of profitability relative to the company’s peers.
  • The company is projecting an effective tax rate of approximately 23 percent for the year.
  • EPS is forecast in the range of $6.30 to $6.39 per share.

Fasching said the guidance assumes a blended growth rate of approximately 9 percent for the company’s two largest brands, following the brand portfolio streamlining to focus on DECK’s “most profitable long-term opportunities.” He said DECK expects to “yet again deliver record years for Ugg and Hoka, each with annual revenues north of $2.5 billion and significantly contributing to our best-in-class profitability profile.”

“Within this revenue guidance, we continue to expect International to outpace U.S. growth and global Wholesale to outpace DTC for this fiscal year,” he added.

“Over the longer term, our focus remains to create a balanced business across regions and channels as we continue building our consumer base, bolstering connections with consumers through direct relationships and capturing incremental market share for years to come.”

Tariffs
With timing-related favorability seen in the second-quarter results and the expectation of tariff impact in the second fiscal half largely unchanged, Fasching said the company now expects the unmitigated tariff impact on fiscal year 2026 to be approximately $150 million.

“Further, we now estimate that our mitigation efforts for this fiscal year will offset approximately $75 million to $95 million of this pressure, including benefits from select strategic and staggered pricing increases as well as partial cost sharing with factory partners,” he continued. “Please note, this guidance excludes any unforeseen charges that may be considered nonrecurring to our ongoing business or impact from any future share repurchases.”

Additionally, he said the guidance assumes no meaningful deterioration of current risks and uncertainties, which include, but are not limited to, further updates to imposed tariffs or other global trade policy, changes in consumer confidence and recessionary pressures, inflationary pressures, fluctuation in foreign currency exchange rates, supply chain disruptions and geopolitical tensions.

Image courtesy Hoka/Deckers Brands

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See below for additional coverage of the company’s second quarter and deeper details from Ugg.

EXEC: Deckers Brands Execs Talk Ugg Trends, Tariffs, Slower H2 Growth