DECKERS OUTDOOR CORP

Previous wording

We are a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories developed for both everyday casual lifestyle use and high-performance activities. We market our products primarily under five proprietary brands: UGG, HOKA, Teva, Koolaburra, and AHNU. We believe our products are distinctive and appeal to a broad demographic. We sell our products through quality domestic and international retailers, international distributors, and directly to our global consumers through our DTC business, which is comprised of our Company-owned e-commerce websites and retail stores. We seek to differentiate our brands and products by offering diverse lines that emphasize fashion, performance, authenticity, functionality, quality, and comfort, and products tailored to a variety of activities, seasons, and demographic groups. Independent third-party contractors manufacture all of our products.

Current wording

We are a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories developed for both everyday casual lifestyle use and high-performance activities. We market our products primarily under five proprietary brands: HOKA, UGG, Teva, AHNU, and Koolaburra. Our brands compete across the fashion and casual lifestyle, performance, running, and outdoor markets. We believe our products are distinctive and appeal to a broad demographic. Our brands sell our products through quality domestic and international retailers and international distributors in our wholesale channel, and directly to global consumers through our DTC channel, which is comprised of an e-commerce and retail store presence. We seek to differentiate our brands and products by offering diverse lines that emphasize fashion, authenticity, functionality, quality, and comfort, and products tailored to a variety of activities, seasons, and demographic groups. Independent third-party contractors manufacture all of our products.

Previous wording

Consolidated financial performance highlights for the nine months ended December 31, 2024, compared to the prior period, were as follows:

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Consolidated financial performance highlights for the three months ended June 30, 2025, compared to the prior period, were as follows:

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▪Wholesale channel net sales increased 18.9% to $2,244,263.

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▪UGG brand net sales increased 18.9% to $265,092.

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•Diluted earnings per share increased 32.3% to $5.33 per share.

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•Diluted earnings per share increased 24.0% to $0.93 per share.

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We expect our business and industry will continue to be impacted by several important trends and uncertainties, which have not materially changed from those included in our 2024 Annual Report. Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2024 Annual Report for further discussion. Refer to Part I, Item 1A, “Risk Factors,” of our 2024 Annual Report for detailed information on the risks and uncertainties that may cause our actual results to differ materially from our expectations.

Current wording

We expect our business and industry will continue to be impacted by several important trends and uncertainties, which have not materially changed from those described in our 2025 Annual Report. Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Annual Report for further discussion. Refer to Part I, Item 1A, “Risk Factors,” of our 2025 Annual Report for detailed information on the risks and uncertainties that may cause our actual results to differ materially from our expectations.

Previous wording

As of December 31, 2024, our five reportable operating segments include the worldwide wholesale operations of the UGG brand, HOKA brand, Teva brand, and Other brands, as well as DTC. Information reported to the CODM, who is our CEO, President, and PEO, is organized into these reportable operating segments and is consistent with how the CODM evaluates our performance and allocates resources.

Current wording

As of June 30, 2025, our three reportable operating segments include the worldwide operations of the HOKA brand, UGG brand, and Other brands.

Previous wording

HOKA Brand. The HOKA brand is an authentic premium line of year-round performance footwear, which offers enhanced cushioning and inherent stability with minimal weight. Originally designed for ultra-runners, the brand now appeals to world champions, taste makers, and everyday athletes. Expanded marketing and strategic marketplace presence have fueled both domestic and international sales growth of the HOKA brand, which has quickly become a leading brand within run and outdoor specialty wholesale accounts and is growing across its ecosystem of access points. The HOKA brand’s product line includes running, trail, hiking, fitness, and lifestyle footwear offerings, as well as select apparel and accessories.

Current wording

HOKA Brand. The HOKA brand is an authentic premium line of year-round performance footwear, which offers enhanced cushioning and inherent stability with minimal weight. Originally designed for ultra-runners, the brand now appeals to world champions, taste makers, and everyday athletes. Expanded marketing and strategic marketplace presence have fueled both domestic and international sales growth of the HOKA brand, which has quickly become a leading brand within run and outdoor specialty wholesale accounts and is growing across its global marketplace. The HOKA brand’s product line includes running, trail, hiking, fitness, and lifestyle footwear offerings, as well as select apparel and accessories.

Previous wording

UGG Brand. The UGG brand is one of the most iconic and recognized footwear brands in our industry, which highlights our successful track record of building niche brands into lifestyle and fashion market leaders. With loyal consumers around the world, the UGG brand has proven to be a highly resilient line of premium footwear, apparel, and accessories with expanded product offerings that appeal to a growing global audience and a broad demographic.

Current wording

UGG Brand. The UGG brand is one of the most iconic and recognized footwear brands in our industry, which highlights our successful track record of building niche brands into lifestyle and fashion market leaders. With loyal consumers around the world, the UGG brand has proven to be a highly resilient consumer-focused line of premium footwear, apparel, and accessories with year-round product offerings that appeal to a growing global audience and a broad demographic.

Previous wording

Other Brands. Other brands consist primarily of the Koolaburra brand, as well as the recently launched AHNU brand. The Koolaburra brand is a casual footwear fashion line that uses plush materials and is intended to target the value-oriented consumer in order to complement the UGG brand offering. The AHNU brand’s footwear products fuse high-performance technology with timeless style crafted for everyday wear.

Current wording

Other Brands. Other brands consist primarily of the Teva brand, AHNU brand, and Koolaburra brand. The Teva brand’s products are built for a range of outdoor pursuits and include a variety of footwear options, from classic sandals and shoes to boots. The AHNU brand’s footwear products fuse high-performance technology with timeless style crafted for everyday wear. The Koolaburra brand, for which we are phasing out standalone operations by the end of calendar year 2025, is a casual footwear brand that uses plush materials to target value-oriented consumers.

Previous wording

Koolaburra Brand. During the three months ended December 31, 2024, we began taking steps to phase out our standalone operations for the Koolaburra brand in order to maintain focus on our most significant organic opportunities. Refer to the section titled “Reportable Operating Segments” under subsection “Koolaburra Brand” in Note 1, “General,” of our condensed consolidated financial statements in Part I, Item 1 within this Quarterly Report for further information.

Current wording

During the third quarter of fiscal year 2025, we began taking steps to phase out the standalone operations for the Koolaburra brand in order to maintain focus on our most significant organic opportunities. We closed Koolaburra.com as of March 31, 2025, and plan to wind down the Koolaburra brand in the wholesale channel by the end of calendar year 2025.

Previous wording

Refer to the section titled “Reportable Operating Segment Overview,” in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2024 Annual Report for further discussion of our outlook on consumer demand drivers for our products.

Current wording

Refer to the section titled “Reportable Operating Segment Overview,” in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Annual Report for further discussion of our reportable operating segments.

Previous wording

We disclose financial measures calculated and presented in accordance with US GAAP; however, throughout this Quarterly Report we provide certain financial information on a non-GAAP basis (non-GAAP financial measures). We provide non-GAAP financial measures to provide information that may assist investors in understanding our results of operations and assessing our prospects for future performance, which consist of constant currency measures. We believe evaluating certain financial and operating measures on a constant currency basis is important as it excludes the impact of foreign currency exchange rate fluctuations that are not indicative of our core results of operations and are largely outside of our control. However, our non-GAAP financial measures are not intended to represent and should not be considered more meaningful measures than, or alternatives to, measures of financial or operating performance as determined in accordance with US GAAP.

Current wording

We disclose supplemental financial measures calculated and presented in accordance with US GAAP; however, throughout this Quarterly Report we provide certain financial information on a non-GAAP basis (non-GAAP financial measures). We provide non-GAAP financial measures to provide information that may assist investors in understanding our results of operations and assessing our prospects for future performance, which consist of constant currency measures. We believe evaluating certain financial and operating measures on a constant currency basis is important as it excludes the impact of foreign currency exchange rate fluctuations that are not indicative of our core results of operations and are largely outside of our control. However, our non-GAAP financial measures are not intended to represent and should not be considered more meaningful measures than, or alternatives to, measures of financial or operating performance as determined in accordance with US GAAP.

Previous wording

Refer to Note 1, “General,” of our condensed consolidated financial statements in Part I, Item 1 within this Quarterly Report and to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2024 Annual Report for detailed information on the seasonality of our business.

Current wording

Refer to Note 1, “General,” of our condensed consolidated financial statements in Part I, Item 1 within this Quarterly Report and to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Annual Report for detailed information regarding the impacts of seasonality on our business.

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Net Sales. Net sales by location, and by brand and channel were as follows:

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Net Sales. Net sales by brand, channel, and geography were as follows:

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Drivers of significant changes in net sales, compared to the prior period, were as follows:

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Total net sales increased primarily due to higher net sales for the HOKA and UGG brands, partially offset by lower net sales for Other brands. Drivers of significant changes in net sales, compared to the prior period, were as follows:

Previous wording

•Wholesale net sales of the HOKA brand increased primarily due to higher global sales across the brand’s product assortment, driven by market share gains, refilling channel inventory, and benefits from select new points of distribution with key partners, as well as the timing of certain distributor shipments.

Current wording

•Net sales of the HOKA brand increased primarily due to higher global net sales in the wholesale channel, especially internationally. Key global wholesale channel net sales drivers include higher sell-in and re-orders of key franchises, reflecting market share gains and benefits from select new points of distribution with key partners, as well as earlier shipments related to the transition of our European 3PL.

Previous wording

•Wholesale net sales of the UGG brand increased primarily due to higher global sales, especially internationally, as a result of increased demand for year-round key product franchises, strong partnerships with brand enhancing retailers, as well as benefits from increased availability of products in the channel through the peak season, compared to the prior period.

Current wording

•Net sales of the UGG brand increased primarily due to higher global net sales in the wholesale channel, as a result of increased demand for year-round key product franchises, as well as benefits from the timing of sell-in for fall franchises.

Previous wording

Total net sales increased primarily due to higher global net sales across all channels for the UGG and HOKA brands. On a constant currency basis, net sales increased by 16.6%, compared to the prior period. Further, we experienced an increase of 14.2% in the total volume of units sold to 24,900 from 21,800, compared to the prior period. Units sold represents all units related to the total net sales presented, inclusive of all categories such as footwear, apparel, accessories, home goods, and care kits. The prior period total volume of units sold for only footwear has been modified to conform to the current period presentation.

Current wording

•On a constant currency basis, net sales increased by 16.3% compared to the prior period.

Previous wording

•DTC net sales increased primarily due to higher global sales for the UGG and HOKA brands, driven primarily by consumer acquisition and retention online as we continued to experience increased demand for both brands. Comparable DTC channel net sales for the 13 weeks ended December 29, 2024, increased by 18.3%, compared to the prior period.

Current wording

•Comparable DTC channel net sales for the 13 weeks ended June 29, 2025, decreased by 2.2%, compared to the prior period.

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As of December 31, 2024, we have a total of 179 global retail stores (including 139 UGG brand retail stores and 40 HOKA brand retail stores), which includes 93 concept stores and 86 outlet stores.

Current wording

•As of June 30, 2025, we have a total of 191 global Company-owned retail stores (including 143 UGG brand retail stores and 48 HOKA brand retail stores).

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Drivers of significant net changes in total income from operations, compared to the prior period, were as follows:

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Selling, General, and Administrative Expenses. Drivers of significant net changes in SG&A expenses, compared to the prior period, were as follows:

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•Increased variable advertising and promotion expenses of approximately $33,200, primarily due to higher promotional marketing expenses for the HOKA and UGG brands to drive global brand awareness and market share gains, highlight new product categories, and provide localized marketing.

Current wording

•Increased advertising, marketing, and promotion expenses of approximately $13,300, primarily due to higher promotional marketing expenses for the HOKA and UGG brands to drive global brand awareness and market share gains, highlight new product categories, and provide localized marketing.

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•Increased net foreign currency-related losses of approximately $28,100, primarily driven by unfavorable changes in European, Asian, and Canadian exchange rates against the US dollar, compared to a favorable impact in the prior year.

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•Increased net foreign currency-related remeasurement gains of approximately $9,100, primarily due to favorable changes in European and Asian exchange rates against the US dollar.

Previous wording

Drivers of significant net changes in total income from operations, compared to the prior period, were as follows:

Current wording

The increase in total income from operations, compared to the prior period, was primarily due to higher net sales and lower SG&A expenses as a percentage of net sales, partially offset by lower gross margins. Drivers of significant net changes in total income from operations, compared to the prior period, were as follows:

Previous wording

The net decrease in our effective income tax rate, compared to the prior period, was primarily due to higher income tax expense from changes in jurisdictional mix of worldwide income before income taxes, partially offset by a lower benefit from net discrete items, including from return-to-provision adjustments and tax benefits for stock-based compensation.

Current wording

The net increase in our effective income tax rate, compared to the prior period, was primarily due to discrete tax expense for reserve adjustments and a reduced benefit for stock-based compensation, partially offset by net discrete tax benefits for audit settlements and changes in jurisdictional mix of worldwide income before income taxes.

Previous wording

Net Income. The increase in net income, compared to the prior period, was due to higher net sales at higher gross margins, and higher operating margins. Net income per share increased, compared to the prior period, due to higher net income and lower weighted-average common shares outstanding driven by stock repurchases.

Current wording

Net Income. The increase in net income, compared to the prior period, was due to higher net sales and higher operating margins. Net income per share increased, compared to the prior period, due to higher net income and lower weighted-average common shares outstanding driven by stock repurchases.

Previous wording

Sources of Liquidity. We finance our working capital and operating requirements using a combination of cash and cash equivalents balances, including cash from our repatriation strategy, cash provided from ongoing operating activities and, to a lesser extent, available borrowing capacity under our revolving credit facilities. Refer to the “Cash Flows” section below for further discussion on cash flows from ongoing operating activities.

Current wording

Sources of Liquidity. We finance our working capital and operating requirements using a combination of cash and cash equivalents balances, including cash from our repatriation strategy, and cash provided from ongoing operating activities. We also have available borrowing capacity under our revolving credit facilities. Refer to the section titled “Cash Flows” below for further discussion on cash flows from ongoing operating activities.

Previous wording

Cash and Cash Equivalents. As of December 31, 2024, our cash and cash equivalents are $2,240,923, the majority of which is held in highly rated money market funds and interest-bearing bank deposit accounts with established national and global financial institutions. We believe our cash and cash equivalents balances, cash provided by operating activities, and available borrowing capacity under our revolving credit facilities, will provide sufficient liquidity to enable us to meet our working capital requirements and contractual obligations for at least the next 12 months and will be sufficient to meet the long-term requirements of our business strategies and plans. However, there can be no assurance that sufficient capital will continue to be available or that it will be available on terms acceptable to us.

Current wording

Cash and Cash Equivalents. As of June 30, 2025 and March 31, 2025, our cash and cash equivalents balance is $1,720,416 and $1,889,188, respectively, the majority of which is held in highly rated money market funds and interest-bearing bank deposit accounts with established national and global financial institutions. We believe our cash and cash equivalents balances, cash provided by operating activities, and available borrowing capacity under our revolving credit facilities, will provide sufficient liquidity to enable us to meet our working capital requirements and contractual obligations for at least the next 12 months and will be sufficient to allow us to pursue our business strategies and plans. However, there can be no assurance that sufficient capital will continue to be available or that it will be available on terms acceptable to us.

Previous wording

Repatriation of Cash. Our cash repatriation strategy, and by extension, our liquidity, may be impacted by several additional considerations, which include future changes to or interpretations of global tax laws and regulations, and our actual earnings in future periods. During the nine months ended December 31, 2024, and 2023, no cash and cash equivalents were repatriated. As of December 31, 2024, and March 31, 2024, we have $481,836 and $263,820, respectively, of cash and cash equivalents held by foreign subsidiaries, a portion of which may be subject to additional foreign withholding taxes if it were to be repatriated. We continue to evaluate our cash repatriation strategy and currently anticipate repatriating current and future unremitted earnings of non-US subsidiaries to the extent they have been subject to US income tax if such cash is not required to fund ongoing foreign operations. Refer to Note 5, “Income Taxes,” of our consolidated financial statements in Part IV of our 2024 Annual Report for further information regarding our cash repatriation strategy.

Current wording

Repatriation of Cash. Our cash repatriation strategy, and by extension, our liquidity, may be impacted by several additional considerations, which include future changes to or interpretations of global tax law and regulations, and our actual earnings in future periods. During the three months ended June 30, 2025, and 2024, no cash and cash equivalents were repatriated from a foreign subsidiary that were subject to income taxes. As of June 30, 2025, and March 31, 2025, we have $470,987 and $481,836, respectively, of cash and cash equivalents held by foreign subsidiaries, a portion of which may be subject to additional foreign withholding taxes if it were to be repatriated. We continue to evaluate our cash repatriation strategy and currently anticipate repatriating current and future unremitted earnings of non-US subsidiaries to the extent they have been subject to US income tax if such cash is not required to fund ongoing foreign operations. Refer to Note 5, “Income Taxes,” of our consolidated financial statements in Part IV of our 2025 Annual Report for further information regarding our cash repatriation strategy.

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Revolving Credit Facilities. Information about the revolving credit facilities available as of December 31, 2024, is as follows:

Current wording

Revolving Credit Facilities. Information about our revolving credit facilities available as of June 30, 2025, is as follows:

Previous wording

•Primary Credit Facility. During the nine months ended December 31, 2024, we made no borrowings or repayments and there were no material changes to the terms, to the outstanding letters of credit, or to the borrowing availability under our unsecured revolving credit facility disclosed in our 2024 Annual Report.

Current wording

•Primary Credit Facility. During the three months ended June 30, 2025, we made no borrowings or repayments and there were no material changes to the terms, to the outstanding letters of credit, or to the borrowing availability under our unsecured revolving credit facility disclosed in our 2025 Annual Report.

Previous wording

•China Credit Facility. During the nine months ended December 31, 2024, we made no borrowings or repayments and there were no material changes to the terms or to the outstanding bank guarantees under our credit facility in China disclosed in our 2024 Annual Report.

Current wording

•China Credit Facility. During the three months ended June 30, 2025, we made no borrowings or repayments and there were no material changes to the terms or to the outstanding bank guarantees under our credit facility in China disclosed in our 2025 Annual Report.

Previous wording

Refer to Note 6, “Revolving Credit Facilities,” of our consolidated financial statements in Part IV of our 2024 Annual Report for further information on the terms of our revolving credit facilities.

Current wording

Refer to Note 6, “Revolving Credit Facilities,” of our consolidated financial statements in Part IV of our 2025 Annual Report for further information regarding the terms of our revolving credit facilities.

Previous wording

Material Cash Requirements. Our material cash requirements include uses for working capital, and payments to fulfill contractual obligations, capital expenditures, and stock repurchases. Our working capital requirements begin when we purchase raw and other materials and inventories and continue until we ultimately collect the resulting trade accounts receivable. Given the historical seasonality of our business, our working capital requirements fluctuate significantly throughout our fiscal year, and we utilize available cash to build inventory levels during certain quarters in our fiscal year to support higher selling seasons. While the impact of seasonality has been mitigated to some extent, we expect our working capital requirements will continue to fluctuate from period to period.

Current wording

Material Cash Requirements. Our material cash requirements include working capital, payments to fulfill contractual obligations, capital expenditures, and stock repurchases. Our working capital requirements begin when we purchase raw and other materials and inventories and continue until we ultimately collect the resulting trade accounts receivable. Given the historical seasonality of the UGG brand, our working capital requirements fluctuate significantly throughout our fiscal year, and we utilize available cash to build inventory levels during certain quarters to support higher selling seasons. While the impact of seasonality has been mitigated to some extent, we expect our working capital requirements will continue to fluctuate from period to period.

Previous wording

There were no material changes outside the ordinary course of business to the contractual obligations or capital expenditures as disclosed in the sections titled “Contractual Obligations” and “Capital Expenditures” in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2024 Annual Report.

Current wording

Contractual Obligations and Capital Expenditures. There were no material changes outside the ordinary course of business to the contractual obligations or capital expenditures as disclosed in the sections titled “Contractual Obligations” and “Capital Expenditures” in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Annual Report.

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Stock Repurchase Program. As of December 31, 2024, the aggregate remaining approved amount under our stock repurchase program is $640,692. Our stock repurchase program does not obligate us to acquire any amount of common stock and may be suspended at any time at our discretion.

Current wording

Stock Repurchase Program. As of June 30, 2025, the aggregate remaining approved amount under our stock repurchase program is $2,441,711. Our stock repurchase program does not obligate us to acquire any amount of common stock and may be suspended at any time at our discretion.

Previous wording

Operating Activities. Our primary source of liquidity is net cash provided by operating activities, which is driven by our net income after non-cash adjustments and changes in operating assets and liabilities.

Current wording

Operating Activities. Our primary source of liquidity was net cash provided by operating activities, which was driven by our net income after non-cash adjustments and changes in operating assets and liabilities.

Previous wording

The increase in net cash provided by operating activities during the nine months ended December 31, 2024, compared to the prior period, was due to $204,346 of favorable net income after non-cash adjustments, partially offset by $148,689 of unfavorable changes in operating assets and liabilities. Changes in operating assets and liabilities were primarily due to higher purchases of inventory to support higher demand for our brands, unfavorable change from timing of tax payments, and lower net trade accounts payable related to timing of receipts of goods and services and respective disbursements.

Current wording

The decrease in net cash provided by operating activities during the three months ended June 30, 2025, compared to the prior period, was due to $105,877 of unfavorable changes in operating assets and liabilities partially offset by $29,373 of favorable net income after non-cash adjustments. Changes in operating assets and liabilities were primarily due to unfavorable impacts from (1) higher purchases of inventory to support elevated demand for our products and the transition of our European 3PL, (2) timing of derivative cash settlements recorded in prepaid expenses and other current assets, and (3) higher net trade accounts receivable on higher net sales; partially offset by favorable impacts from higher net trade accounts payable from timing of receipts of goods and services and respective disbursements.

Previous wording

Investing Activities. The decrease in net cash used in investing activities during the nine months ended December 31, 2024, compared to the prior period, was primarily due to an increase from cash proceeds from the sale of certain assets.

Current wording

Investing Activities. Net cash used in investing activities remained relatively unchanged during the three months ended June 30, 2025, compared to the prior period.

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Financing Activities. The increase in net cash used in financing activities during the nine months ended December 31, 2024, compared to the prior period, was primarily due to an increase of cash paid for shares withheld for taxes, partially offset by a lower dollar value of stock repurchases, inclusive of excise taxes.

Current wording

Financing Activities. The increase in net cash used in financing activities during the three months ended June 30, 2025, compared to the prior period, was due to a higher dollar value of stock repurchases, inclusive of excise taxes.