Deckers Gears Up for Q3 Earnings: HOKA to Drive Top-Line Growth

Core Viewpoint - Deckers Outdoor Corporation is set to announce its third-quarter fiscal 2025 earnings results, with investors focused on the company's performance amid market challenges and opportunities [1]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for Deckers' revenues is $1.70 billion, reflecting a 9.1$2.56, indicating a 1.6% growth year-over-year [3]. Key Growth Drivers - Deckers is focusing on innovation and expanding brand reach, particularly through product development for its HOKA and UGG brands [5]. - Sales for UGG are expected to grow by 1%, while HOKA is projected to see a significant increase of 19.7% year-over-year [6]. - The company is enhancing its direct-to-consumer channels, anticipating a 7% increase in direct-to-consumer revenues [7]. - International market expansion is a crucial part of Deckers' growth strategy, helping to increase market share and brand recognition [8]. Margin Pressures - Anticipated margin compression is expected due to rising costs, particularly in freight and a shift towards a normalized promotional environment, with gross margin expected to shrink by 320 basis points [9]. - SG&A expenses are projected to increase as a percentage of net sales, leading to an operating margin contraction of 480 basis points [9]. Earnings Prediction - The model predicts an earnings beat for Deckers, supported by a positive Earnings ESP of +6.84% and a Zacks Rank of 1 (Strong Buy) [10][11].