Deckers raises full-year EPS outlook to $7.80 to $7.95 after record second-quarter sales

Deckers Outdoor Corporation (DECK) said Thursday in a regulatory filing that second-quarter fiscal 2027 net sales reached a record $1.481 billion, up 3.5% from a year earlier, and that it raised its full-year diluted earnings per share outlook to $7.80 to $7.95.

The results cover the three months ended Sept. 30, 2026. The company released them in a press release attached to the 8-K.

Here's how the company did:

• Net sales: $1.481 billion vs. $1.431 billion a year earlier
• Diluted earnings per share: $2.31 vs. $1.82 a year earlier
• Gross margin: 60.5% vs. 56.2% a year earlier
• Operating income: $389.5 million vs. $326.5 million a year earlier

Diluted earnings per share rose 27%, the company said. The quarter included $46.0 million of tariff refunds under the International Emergency Economic Powers Act, or IEEPA, plus $3.0 million of associated interest.

Those amounts reduced cost of sales and increased other income. The company said the net benefit to gross margin and operating margin was about 310 basis points, or about $0.28 per diluted share after tax.

Selling, general and administrative expenses rose to $505.7 million from $477.3 million a year earlier.

Here's how other Deckers brands and channels did during the quarter:

• HOKA brand net sales: up 6.8% to $677.2 million vs. $634.1 million
• UGG brand net sales: up 3.5% to $786.4 million vs. $759.6 million
• Other brands: down 54.3% to $17.0 million vs. $37.2 million
• Wholesale: up 5.5% to $1.093 billion vs. $1.036 billion
• Direct-to-consumer: down 1.8% to $387.5 million vs. $394.6 million, with comparable sales down 6.4%
• International: up 9.0% to $644.7 million vs. $591.3 million
• Domestic: down 0.4% to $835.8 million vs. $839.5 million

International sales grew while domestic sales slipped slightly. The company said the Other brands, Wholesale and Domestic results include declines tied to the phase-out of standalone Koolaburra brand operations.

President and Chief Executive Officer Stefano Caroti said the company is changing its approach in the second half of the fiscal year. "As we move through the back half of fiscal 2027, we are taking deliberate actions to strengthen our connection with consumers, sharpen execution, and concentrate resources behind our greatest opportunities."

The company now expects net sales of $5.700 billion to $5.725 billion for the fiscal year ending March 31, 2027. The press release does not restate the previous net sales range, so the size of the change cannot be measured from the filing.

HOKA net sales are now expected to increase by a high-single-digit percentage versus last year, and UGG by a low-single-digit percentage.

Gross margin is now expected at about 58.5%, SG&A at about 35.5% of net sales, and operating margin at about 23%. The effective tax rate is still expected at about 23%.

Diluted EPS is now expected in a range of $7.80 to $7.95. The EPS guidance assumes share repurchases worth $1.0 billion.

The outlook includes IEEPA tariff net refunds received through Oct. 8, 2026, totaling $87.9 million plus $4.7 million of interest. The company said this adds about 150 basis points to gross and operating margins and about $0.52 to full-year diluted EPS after tax. It does not assume further refunds.

The company said the outlook reflects its expectations as of Oct. 22, 2026, and remains subject to changes in macroeconomic and geopolitical conditions, global trade policy including tariffs, and supply chain disruption.

Cash and cash equivalents were $1.210 billion at Sept. 30, compared with $1.414 billion a year earlier. Inventories were $860.8 million, against $835.6 million. The company had no outstanding borrowings.

In the quarter, the company repurchased about 3.2 million shares for $299.3 million, at a weighted average price of $93.65. Fiscal year to date, it repurchased about 6.5 million shares for $637.5 million, at a weighted average of $98.77. About $4.4 billion remained under its stock repurchase authorization as of Sept. 30.

Board appointment and retirement

In a separate item in the same filing, the company said it appointed Rati Sahi Levesque as a director, effective Dec. 1, 2026. She replaces Lauri Shanahan, who is retiring from the board after more than a decade of service.

The company's press release says Levesque is president, chief executive officer and a director of The RealReal (NASDAQ: REAL), and that she has more than 15 years of leadership experience in retail.

Levesque will join the Audit & Risk Management Committee. Patrick J. Grismer, a current board member, will join the Corporate Responsibility, Sustainability & Governance Committee, also effective Dec. 1, 2026.

The company said Shanahan's retirement is not the result of any disagreement with its operations, policies or practices. A separate press release on the appointment was furnished as Exhibit 99.2.