Deckers Powers 22% Ahead With Hoka Leading The Charge And Ugg A Strong Supporting Player

Company Performance - Deckers Brands' revenue grew from $1.8 billion in fiscal 2017 to $4.3 billion in fiscal 2024, an 18% year-over-year increase [1] - First quarter 2025 revenues increased 22% to $825 million, with direct-to-consumer sales up 24% and wholesale sales up 21% [2] - Operating income surged nearly 90% from $70.7 million in the previous year to $132.8 million in the first quarter of 2025 [2] Leadership Transition - Stefano Caroti, who has been with Deckers for nine years, takes over as CEO from Dave Powers [3] - Powers led the company through significant growth, with revenues increasing from $1.8 billion to $4.3 billion during his tenure [1] - Caroti's promotion to CEO is seen as a continuation of the successful strategy he helped develop [21] Brand Performance - Hoka led the brand performance with a 30% increase in revenue to $545.2 million in the first quarter of 2025 [5] - Ugg grew 14% to $223 million, while Koolaburra, a more affordable Ugg spin-off, saw a 124% increase to $4 million [5] - Teva sandals declined 4% to $46.4 million, and Sanuk dropped 28% to $6.9 million, with Sanuk set to be divested [6] Financial Guidance - Deckers projects a 10% annual revenue increase to $4.7 billion, with an operating margin target of 19.5% to 20% [6] - The company's current operating margin is 16% [6] - Analysts predict a potential 13% revenue increase by year-end, citing Deckers' conservative guidance [7] Stock Performance - Deckers' stock price rose from $674 at the start of the year to $923 by July, prompting a six-for-one stock split announcement in September [8] Strategic Focus - Hoka's growth is a key focus, with plans to expand wholesale distribution and increase direct-to-consumer sales [11][12] - The company aims to grow Hoka's athletic apparel offerings to capture more market share [13] - Ugg is transitioning from a trend-focused brand to a year-round, near-luxury lifestyle brand, with a focus on maintaining demand higher than supply [18][19] Retail Expansion - Hoka operates 26 stores globally, with plans to expand strategically rather than rapidly [12][13] - Ugg has around 60 full-priced stores and 80 outlets worldwide, with a focus on driving demand through wholesale and direct-to-consumer channels [19] Brand Awareness - Hoka's global brand awareness is growing, with strong consumer retention and loyalty [14] - Ugg's Koolaburra franchise is helping to attract next-generation customers to the near-luxury parent brand [20]