Shares for Deckers Brands were up nearly 6 percent in after-hours trading on Thursday as the footwear company reported its largest quarter in history driven by its star Hoka and Ugg brands.
The Goleta, Calif.-based footwear company reported net sales in the third quarter of 2024 increased 16 percent to $1.560 billion compared to $1.346 billion the same time last year. Deckers also saw a bump in its direct-to-consumer channel, reporting an increase of 22.7 percent to $858.1 million compared to $699.3 million in Q3 2023. Wholesale net sales for Q3 were up 8.6 percent to $702.2 million compared to $646.3 million the same time last year.
Net income in the period was $389.9 million, up from $278.7 million in the same quarter last year.
By brand, Hoka saw the largest increase in sales in the third quarter, reporting a 21.9 percent rise to $429.3 million compared to $352.1 million in Q3 2023. Ugg also continued its winning streak in the period, posting net sales of $1.072 billion, a 15.2 percent increase from $930.4 million last year.
Also on the positive side, Deckers’ other brands division, primarily composed of Koolaburra, saw net sales increase 10 percent to $29.6 million compared to $26.9 million in the same time last year.
Teva and Sanuk, the latter of which the company announced plans to divest late last year, did not fare as well this quarter. In Q3, Teva saw a 16.2 percent decline in net sales to $25.6 million compared to $30.5 million the same time last year. Sanuk reported a 28.9 percent drop in net sales to $4.0 million in the period compared to $5.6 million last year.
Company president and chief executive officer Dave Powers said in a statement on Thursday that Hoka and Ugg drove “exceptional performance” in the quarter, led by the company’s DTC channel and high levels of full price selling.
“Global gains in awareness, combined with elevated consumer connections and innovative product offerings, continued to drive unparalleled demand for our brands,” Powers said. “This, coupled with our disciplined operating approach, dedicated focus on marketplace management and fortified balance sheet, puts Deckers in a position of strength as we enter our last fiscal quarter of 2024.”
In light of this performance, Deckers is raising its full year guidance. Deckers now expects net sales for the full fiscal year to be approximately $4.15 billion, with diluted earnings per share in the range of $26.25 to $26.50. This is up from the company’s previous guidance, which noted full-year net sales of approximately $4.03 billion, with diluted earnings per share in the range of $22.90 to $23.25.
“We believe Hoka and Ugg are two of the healthiest brands in the industry and we remain focused on executing against our strategic initiatives to drive long-term future success,” Powers added.
The company’s latest earnings report comes the same day it announced that Powers plans to retire on Aug. 1. Stefano Caroti, the company’s chief commercial officer, will take over for Powers upon his retirement.
