Deckers Brands, the company behind HOKA running shoes and UGG boots, reported a record $1.48 billion quarter on 22 October 2026 and raised its full-year profit forecast. One line further down, the Deckers earnings release also cut the sales outlook by roughly $170 million, and a one-off tariff refund is doing a lot of the work behind that higher profit forecast.
Key takeaways
- Quarterly sales rose 3.5% to $1.481 billion, slightly short of the $1.51 billion analysts expected.
- Diluted earnings per share jumped 27% to $2.31, including about $0.28 from tariff refunds.
- The full-year sales forecast fell to $5.700-$5.725 billion, down from $5.86-$5.91 billion in July.
- The forecast for HOKA growth slowed to a high-single-digit rate, and UGG’s slowed to a low-single-digit rate.
- Without the refunds, the new profit forecast sits slightly below the July forecast.
What did Deckers report for Q2 fiscal 2027?
Deckers’ financial year ends in March, so “Q2 fiscal 2027” means July to September 2026. According to the results release Deckers filed with the SEC, net sales rose 3.5% to $1.481 billion. In constant currency (with exchange-rate swings stripped out), they rose 2.8%.
Diluted EPS (earnings per share, or profit divided by the share count) climbed to $2.31 from $1.82. In an Investing.com preview, analysts had expected $1.79 on $1.51 billion of revenue. That makes a clear profit beat and a sales miss of about $29 million.
| Metric | Q2 FY2026 | Q2 FY2027 | Change |
|---|---|---|---|
| Net sales | $1.431B | $1.481B | +3.5% |
| HOKA | $634.1M | $677.2M | +6.8% |
| UGG | $759.6M | $786.4M | +3.5% |
| Other brands | $37.2M | $17.0M | -54.3% |
| Wholesale | $1.036B | $1.093B | +5.5% |
| Direct-to-consumer | $394.6M | $387.5M | -1.8% |
| Gross margin | 56.2% | 60.5% | +4.3 pts |
| Diluted EPS | $1.82 | $2.31 | +27% |
How much did the tariff refund lift Deckers earnings?
A lot. Deckers is getting back tariffs it paid under the International Emergency Economic Powers Act (IEEPA), the emergency law that was used to impose a series of import duties. In the quarter, it received $46.0 million in refunds plus $3.0 million in interest.
That money added about 3.1 percentage points to gross margin and about $0.28 to EPS. Without it, EPS would have been roughly $2.03. That still beats the $1.79 estimate, so the beat was real. The refund just made it look bigger.
It’s like finding a tax rebate in your mailbox. It’s nice, but it doesn’t mean you got a raise. By 8 October 2026, Deckers had collected $87.9 million in refunds plus $4.7 million in interest. It expects this to add about $0.52 to full-year EPS.
Why did Deckers cut its sales outlook?
Shoppers are spending less freely. Here is how the full-year guidance for the year ending 31 March 2027 changed between the July first-quarter release and the October update.
| FY2027 guidance | July 2026 | October 2026 |
|---|---|---|
| Net sales | $5.86B-$5.91B | $5.700B-$5.725B |
| HOKA growth | Low double digits | High single digits |
| UGG growth | Mid single digits | Low single digits |
| Gross margin | Slightly above 56.5% | About 58.5% |
| Operating margin | Slightly above 21.5% | About 23% |
| Diluted EPS | $7.35-$7.50 | $7.80-$7.95 (incl. ~$0.52 refunds) |
Take the $0.52 refund out of the new EPS range and you get about $7.28-$7.43. At the midpoint, that is about 7 cents below what Deckers forecast in July, and it already assumes $1.0 billion of share buybacks. Chief executive Stefano Caroti was candid about the backdrop:
“We delivered earnings above our expectations in the second quarter by maintaining disciplined marketplace management and a focus on expense control in a challenging consumer environment.”
Stefano Caroti, CEO, Deckers Brands
The detail backs him up. Comparable direct-to-consumer sales, which cover Deckers’ own websites and stores, fell 6.4%. US sales slipped 0.4%, while international sales rose 9.0%.
Is HOKA still growing fast enough?
HOKA is still growing, just more slowly each quarter. Investing.com puts its growth at 24% in fiscal 2025 and 16% in fiscal 2026. It then fell to 7.7% in the June 2026 quarter and 6.8% in the September quarter.
My read, and it is only an opinion, is that HOKA is turning from a breakout brand into a mature one. Wholesale rose 5.5% while Deckers’ own channels shrank. That suggests retailers still want the shoes, but shoppers are buying fewer of them at full price direct from the brand. Consumer brands everywhere are fighting for a squeezed buyer, which is one reason Bose bought Skullcandy.
What do the buybacks mean for shareholders?
Deckers is shrinking its share count fast. In the quarter, it bought back about 3.2 million shares for $299.3 million, at an average of $93.65. Over the first half of the year, it spent $637.5 million on 6.5 million shares at an average of $98.77.
It has no borrowings, held $1.21 billion in cash on 30 September 2026, and still has about $4.4 billion of buyback authorisation left. The stock closed at $85.49 on 21 October 2026, the day before the results, below what Deckers paid on average. Investing.com put its forward P/E (share price divided by expected annual profit per share) at 11.6, well below its historical average.
What happens next
The next six months matter more than the last three. Investing.com notes that more than 80% of UGG’s annual direct-to-consumer revenue arrives in the second half of the fiscal year, which runs from October to March.
- Holiday boots: Black Friday and December decide UGG’s year. Discounting will show up in margins. Here’s why Black Friday “deals” are often not the cheapest prices.
- HOKA’s trend: Another quarter of single-digit growth would confirm a slowdown rather than a blip.
- More refunds: The guidance only counts refunds received by 8 October 2026, so any later money would be extra.
- Next report: Deckers usually reports its December quarter in late January. Check its investor relations site for the date.
FAQ
Did Deckers beat earnings expectations in Q2 fiscal 2027?
On profit, yes. EPS was $2.31, against a $1.79 estimate, and about $2.03 without tariff refunds. Revenue of $1.481 billion came in slightly below the $1.51 billion analysts expected.
Why did Deckers raise EPS guidance but lower sales guidance?
The higher EPS range of $7.80-$7.95 includes about $0.52 from IEEPA tariff refunds, plus higher margins and buybacks. Sales guidance fell because HOKA and UGG are now expected to grow more slowly.
What are the IEEPA tariff refunds?
They are refunds of import duties Deckers paid under the International Emergency Economic Powers Act. By 8 October 2026, it had received $87.9 million plus $4.7 million in interest.
If you follow footwear stocks, check UGG’s holiday sales and HOKA’s growth rate when Deckers next reports. They will show whether this quarter was a pause or a plateau.
This article is for information only and is not investment advice.
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