Are UGG Boots Surging In Popularity? Deckers Clocks 28% Revenue Jump, Stock Soars

Deckers Outdoor Corp DECK reported second-quarter FY24 sales growth of 24.7% year-on-year to $1.09 billion, beating the analyst consensus estimate of $960.51 million.

Direct-to-Consumer (DTC) net sales increased 38.8% to $331.7 million, and Wholesale net sales grew 19.4% to $760.2 million.

Brand Sales: UGG jumped 28.1%, HOKA increased 27.3%, Teva fell 28.4%, and Sanuk declined 28.5%.

Gross profit increased 38.2% to $583 million and the gross margin expanded 520 basis points to 53.4%.

Operating income climbed 75.7% to $224.6 million with an operating margin of 20.6%.

EPS of $6.82 beat the consensus estimate of $4.43.

The company held $823.1 million in cash and equivalents as of September 30, 2023. Inventories declined 21.5% to $726.3 million.

As of September 30, 2023, the company had approximately $1.146 billion remaining under its stock repurchase authorization.

"The strength of demand for our HOKA and UGG brands continued to drive exceptional performance, producing record revenue and earnings for Deckers in both the second quarter and first half of fiscal year 2024," said President and CEO Dave Powers.

Outlook: Deckers sees FY24 revenue to be $4.025 billion (prior view $3.980 billion) versus an estimate of $4.01 billion.

DECK sees EPS of $22.90 - $23.25 (prior view $21.75-$22.25) against the consensus estimate of $22.62.

Price Action: DECK shares closed lower by 1.59% at $484.58 on Thursday.