Deckers Beats on Q1 Earnings, Raises FY25 Guidance

Deckers Outdoor Corporation (NYSE: DECK) witnessed a 10.2% jump in its share price during the after-market trading session on Jul 25. This rally was in response to the company’s outstanding first-quarter performance and an upbeat fiscal 2025 forecast. The strong quarterly results were underpinned by the exceptional performance of the HOKA ONE ONE and UGG brands.

Deckers has shown robust growth through its strategic focus on expanding its brand presence and strengthening direct-to-consumer channels. This approach, along with a commitment to innovation in product development and a keen focus on international market expansion, has positioned the company for continued success.

Shares of this Goleta, CA-based company have advanced 17.7% in the past six months compared with the industry’s 3.6% growth.

Let’s Delve Deeper

Deckers delivered quarterly earnings of $4.52 per share, which surpassed the Zacks Consensus Estimate of $3.59 per share. The reported figure increased substantially from the prior-year quarter’s tally of $2.41 per share.

Net sales of this Zacks Rank #2 (Buy) company increased 22.1% year over year to $825.3 million and outpaced the consensus estimate of $805 million. On a constant-currency basis, net sales grew 23%.

The gross margin in the first quarter expanded to 56.9% from 51.3% in the year-ago period and also significantly surpassed our expectation of 53.7%. This improvement can be attributed to several factors, including favorable brand and product mix, higher levels of full-price selling and lower freight rates.

SG&A expenses climbed 22.3% year over year to $337.2 million. As a percentage of net sales, SG&A stood at 40.9%, 10 basis points higher than the last year. We had anticipated a year-over-year increase of 20.4% in the metric.

The company’s operating income came in at $132.8 million, up from …

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