Deckers Brands stock plunges 16 percent on conservative sales outlook

Deckers Brands stock fell 16 percent in extended trading hours since the company’s sales outlook did not meet investors’ expectations following a strong set of results registered during the holiday quarter.

According to data compiled by LSEG and reported by Reuters, the company’s net sales increase of 17.1 percent to 1.827 billion dollars beat analysts’ consensus of 1.73 billion dollars. The company’s margin also increased to 60.3 percent and diluted earnings per share rose to 3 dollars compared to 2.52 dollars in the previous year.

“Deckers posted exceptional results in the third quarter, delivering record quarterly revenue, gross margin, and earnings,” said Stefano Caroti, president and CEO of Deckers Brands.

However, even with an improved annual sales outlook, analysts expected more.

Deckers outlook falls short of expectations

Despite strong holiday quarter performance, Deckers raised its annual net sales forecast to a 15 percent increase, up from the previously projected growth of around 12 percent.

Still, analysts remained unimpressed. Drake MacFarlane, an analyst at MScience, described the guidance as conservative.

“Given the magnitude of the beat, it’s not a great read for the remainder of fiscal 2025,” MacFarlane told Reuters.

Deckers registers strong holiday quarter

The company’s DTC revenue growth was 17.9 percent to 1.011 billion dollars, while DTC comparable net sales increased 18.3 percent. Wholesale net sales for the quarter increased 16.2 percent to 815.8 million dollars.

Deckers’ domestic net sales increased 11.5 percent to 1.169 billion dollars and international sales increased 28.5 percent to 657.9 million dollars.

Across brands, UGG net sales increased 16.1 percent to 1.244 billion dollars, Hoka net sales increased 23.7 percent to 530.9 million dollars, while Teva brand net sales decreased 6 percent to 24.1 million dollars and other brands net sales decreased 16.6 percent to 28 million dollars.