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Shoemaker Deckers Outdoor beats quarterly estimates thanks to strong demand for HOKA and UGG

Shoemaker Deckers Outdoor beats quarterly estimates thanks to strong demand for HOKA and UGG

Deckers Outdoor beat Wall Street estimates with its fourth-quarter results on Thursday, benefiting from strong demand for its premium UGG boots and HOKA sneakers.

The company's shares rose nearly 8% in after-hours trading, up 35% this year, as gross margin also rose in the fourth quarter.

Deckers Outdoor, like its competitor On Holding, has seen strong demand for sports apparel and footwear over the past year as it maintained limited inventory to drive demand in its wholesale and direct-to-consumer (DTC) channels.

“The company has two very strong brands in UGG and HOKA that continue to resonate with consumers. We see continued momentum in both brands due to comfort in UGG and consumer interest in running and outdoor activities in HOKA,” said Jessica Ramirez, analyst at Jane. Haley and company.

UGG brand net sales rose 14.9% to $361.3 million in the quarter ended March 31, while HOKA sales rose 34% to $533 million.

The company's DTC sales rose 21%, after a 19.5% increase last year, while wholesale sales rose 21.4%.

Gross margins increased to 56.2% compared to 50% last year.

“We recognize that the disproportionate expansion in margins we have seen, particularly due to historically low promotions and discount campaigns, may not be repeated to the same extent in future periods,” Deckers management said in a conference call after the financial results. Numbers.

Deckers reported a 21.2% jump in fourth-quarter revenue to $959.8 million, compared to analyst estimates of $887.6 million, according to LSEG data.

The company earned $4.95 per share in the period, beating expectations of $2.89 per share.

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For fiscal 2025, the company expects net sales to rise 10% to $4.70 billion, in line with expectations of $4.71 billion, LSEG data show.

Deckers expected earnings per share to range between $29.50 and $30, compared to expectations of $30.27. The gross profit margin for 2025 is expected to reach 53.5%, compared to 55.6% in 2024.