NEW YORK, July 24, 2026, 07:06 EDT
Deckers Outdoor Corporation NYSE:DECK was indicated at about $92.14 ahead of Friday’s session, sliding 4.3% from the previous day. The decrease comes after the company reported a 6% drop in quarterly operating income.
The shortfall concerns investors. Diluted shares decreased by 7.4%, surpassing a 6.6% decline in net income.
Based on last year’s number of shares, quarterly earnings per share came in close to $0.87. The figure met the average estimate from analysts but was below the $0.93 reported a year earlier.
The NYSE had yet to begin core trading, with the regular session scheduled to open at 09:30 EDT. Deckers shares declined by 9.6% between last Friday’s close and Thursday. The initial quote extended that decrease to nearly 13.5%.
The quarter highlighted the reasons behind the muted reaction to the earnings beat.
| Metric | Q1 FY2027 | Q1 FY2026 | Change |
|---|---|---|---|
| Net sales | $1,019.5 million | $964.5 million | +5.7% |
| Gross margin | 56.4% | 55.8% | +60 bp |
| SG&A expenses | $419.9 million | $372.6 million | +12.7% |
| Operating income | $155.3 million | $165.3 million | -6.0% |
| Operating margin | 15.2% | 17.1% | -190 bp |
| Net income | $130.0 million | $139.2 million | -6.6% |
| Diluted shares | 138.6 million | 149.6 million | -7.4% |
| Diluted EPS | $0.94 | $0.93 | +1.1% |
Deckers’ reported results are used to determine changes and operating margins.
Revenue increased by 5.7%, with gross margin expanding by 60 basis points. However, SG&A expenses jumped 12.7%, outpacing sales growth by more than double. Operating margin declined to 15.2%.
Deckers acquired 3.3 million shares for $338.2 million in the quarter, with an average buyback price of $103.79 per share.
Share repurchases continue to factor into projections. The annual EPS forecast is based on buybacks totaling approximately 80% of expected free cash flow.
Chief Executive Stefano Caroti said, “Deckers delivered a solid start to the fiscal year, surpassing $1 billion of first quarter revenue for the first time.” Deckers Outdoor Corporation
Sales for Hoka increased by 7.7%, and UGG climbed 4.9%. In the preceding quarter, they had posted growth rates of 14.5% and 9.2%, respectively.
Revenue from direct-to-consumer rose by 13%, compared to a 2.2% increase in wholesale. The stronger contribution from direct sales helped push the gross margin higher.
“The company’s ability to increase margins shows that brand desirability remains high,” eMarketer analyst Rachel Wolff said. However, Nike NYSE:NKE shares declined 2.9% on Thursday, compared with a 6.1% drop for Deckers. MarketScreener
Deckers maintained its sales forecast at $5.86 billion to $5.91 billion. The company increased its EPS guidance by five cents to a range of $7.35-$7.50, raising the midpoint by 0.7%.
Deckers has not scheduled any company events for the upcoming week. Analyst estimates and movements following recent earnings will be the next drivers for shares.
Tariffs, supply expenses, and discretionary outlays continue to be key risks. Ongoing share repurchases could aid EPS, but are insufficient to prevent a decline in operating profit.
