Deckers Q3 2026 Earnings Show HOKA Momentum

Deckers Outdoor Corp. (DECK) reported Q3 2026 earnings on Jan. 29, 2026, beating revenue and EPS estimates as management highlighted HOKA growth and stabilizing U.S. sales. The company raised its full-year guidance despite tariff headwinds, citing pricing actions that helped offset costs.

Quarter Results and Brand Performance

Deckers reported third-quarter revenue of $1.96 billion, a 7% increase year over year, driven by broad strength across its core brands and channels. Diluted earnings per share rose 11% to $3.33, surpassing consensus expectations. Gross margin held at 59.8%, down 50 basis points from a year earlier but above the guidance midpoint, supported by the timing of lower-tariff inventory and pricing measures.

HOKA led the quarter with revenue of $629 million, up 18%, adding about $98 million from the prior year. Growth was balanced between direct-to-consumer (DTC) sales, which rose 19%, and wholesale, up 18%. U.S. DTC sales showed a positive inflection, underscoring HOKA’s role as the primary driver of the beat.

UGG posted a record quarterly revenue of $1.31 billion, up 5%, contributing roughly $61 million in incremental sales. Both wholesale and DTC channels grew, by 4% and 5% respectively. Other brands declined sharply to $23.2 million as the company phased out the Koolaburra label.

Wholesale sales increased 6% to $864.6 million, while DTC sales rose 8.1% to $1.09 billion, with comparable-store sales up 7.3%. U.S. revenue grew 2.7% to $1.20 billion, and international sales climbed 15% to $756.7 million. Operating income rose 8.3% to $614.4 million, lifting the operating margin 40 basis points to 31.4%. Selling, general, and administrative expenses (SG&A) totaled $557 million, or 28.5% of revenue, down 80 basis points year over year. The company ended the quarter with $2.1 billion in cash and equivalents, inventory of $633 million (up 10% including tariff-related items), and no borrowings.

Guidance and Capital Returns

Deckers raised its full-year 2026 revenue guidance to $5.40 billion–$5.425 billion and lifted diluted EPS guidance to $6.80–$6.85. The company expects full-year gross margin near 57% and operating margin around 22.5%, with SG&A at roughly 34.5% of revenue and an effective tax rate of about 23%. For the fourth quarter, it forecasts HOKA growth of 13%–14% and anticipates the heaviest net tariff burden, reflecting the full 20% tariff, along with modest SG&A deleverage.

Management disclosed an unmitigated tariff impact of approximately $110 million for the fiscal year, with timing and pricing actions reducing the near-term net effect to about $25 million.

Share repurchases remained a priority, with $349 million spent in the quarter at an average price of $92.36 per share. Year to date, Deckers repurchased eight million shares, representing more than 5% of shares outstanding. The company remains on track to repurchase over $1 billion in fiscal 2026, a program expected to add more than $0.20 to EPS, with about $1.8 billion of authorization still available.

Management attributed the upgraded outlook and buyback pace to sustained pricing power, disciplined marketplace management, and ongoing investments in DTC and customer loyalty. "We are very proud of our company's ability to guide for another year of robust and profitable growth," said Stefano Caroti, president and CEO.