DECKERS OUTDOOR CORP
For the period ended Sep 30, 2025. Filed Oct 31, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 31, 2025
DECK$86.71-1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-07-31.
0000910521-25-000037
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-10-31.
0000910521-25-000044
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 93 previous paragraphs and 120 current paragraphs.
43 unchanged; 33 reworded; 29 added; 17 removed; 0 previous and 15 current paragraphs rearranged.
Tables are not compared: 6 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (29)
Current report
•Net sales increased 12.1% to $2,395,378.
Current report
▪Wholesale channel net sales increased 18.2% to $1,688,593.
Current report
▪DTC channel net sales decreased 0.2% to $706,785.
Current report
▪Domestic net sales decreased 2.1% to $1,340,788.
Current report
▪International net sales increased 37.5% to $1,054,590.
Current report
•SG&A expenses increased 11.0% to $849,920.
Current report
•Income from operations increased 12.3% to $491,808.
Current report
•Operating margin remained flat at 20.5%.
Current report
The Other brands reportable operating segment includes current and historical results of the Koolaburra and AHNU brands that are being phased out for standalone operations, as well as the Sanuk brand that was previously sold. Refer to the section titled “Reportable Operating Segments,” in Note 1, “General,” of our condensed consolidated financial statements in Part I, Item 1 within this Quarterly Report, for further information.
Current report
(1) Includes Sanuk brand financial results from July 1, 2024 through the Sanuk Brand Sale Date for the three months ended September 30, 2024, which are presented in the Other brands reportable operating segment.
Current report
•Net sales of the UGG brand increased primarily due to higher global net sales from the wholesale channel, as a result of higher sell-in of key product franchises, compared to the prior period, as well as earlier shipments primarily related to the transition of our European 3PL. These impacts were partially offset by lower net sales in the DTC channel, which has been pressured by earlier wholesale channel shipments, particularly with consumer preferences shifting toward multi-brand shopping experiences.
Current report
•Net sales of the HOKA brand increased primarily due to higher international net sales across all channels, particularly in the wholesale channel driven by higher sell-in and re-orders, as well as higher sales in the DTC channel, collectively reflecting a positive consumer response to key franchise upgrades.
Current report
•Net sales of the Other brands decreased primarily due to lower US net sales in the wholesale channel driven by the phase-out of standalone operations of the Koolaburra brand.
Current report
Gross Profit. Gross margin increased to 56.2% from 55.9%, compared to the prior period, primarily due to benefits from price increases, favorable product mix shifts, favorable foreign currency exchange rate fluctuations, and tariff-related cost sharing arrangements, partially offset by incremental tariffs on US goods and unfavorable channel mix as wholesale revenue growth outpaced DTC revenue growth. The net impact of tariff-related variables was not material in the current period due to the timing of the implementation of our mitigation strategies, including price increases and earlier inventory shipments in advance of the incremental tariffs.
Current report
•Increased rent and occupancy of approximately $13,200, primarily due to higher operating expenses for our owned warehouses and DCs, as well as higher rent expenses for investments in our global retail store footprint, primarily to support the HOKA brand.
Current report
•Increased other SG&A expenses of approximately $9,600, primarily due to higher other variable operating expenses for our brands of approximately $17,700, partially offset by lower legal expenses, travel expenses, and other miscellaneous expenses. Higher other variable operating expenses was primarily driven by the UGG brand as a result of sales commissions and bad debt expense of approximately $8,500, the HOKA brand as a result of sales commissions and other miscellaneous expenses of approximately $8,200, and Other brands for bad debt expense of approximately $1,000.
Current report
(1) Includes Sanuk brand financial results from July 1, 2024 through the Sanuk Brand Sale Date for the three months ended September 30, 2024, which are presented in the Other brands reportable operating segment.
Current report
•The increase in income from operations of UGG brand was due to higher net sales at higher gross margins, partially offset by higher SG&A expenses as a percentage of net sales primarily driven by advertising, marketing, and promotion expenses, and other SG&A expenses.
Current report
(1) Includes Sanuk brand financial results from April 1, 2024 through the Sanuk Brand Sale Date for the six months ended September 30, 2024, which are presented in the Other brands reportable operating segment.
Current report
•Net sales of the HOKA brand increased primarily due to higher international net sales across all channels, particularly in the wholesale channel driven by higher sell-in and re-orders, as well as higher sales in the DTC channel, collectively reflecting a positive consumer response to key franchise upgrades.
Current report
Supplemental Disclosure
Current report
•Increased other SG&A expenses of approximately $24,600, primarily due to higher other variable operating expenses for our brands of approximately $28,100. Higher other variable operating expenses was primarily driven by the HOKA brand as a result of sales commissions and other miscellaneous expenses of approximately $16,700, the UGG brand as a result of sales commissions and bad debt expense of approximately $9,800, and Other brands for bad debt expense of approximately $1,600.
Current report
•Increased rent and occupancy of approximately $18,300, primarily due to higher operating expenses for our owned warehouses and DCs, as well as higher rent expenses for investments in our global retail store footprint, primarily to support the HOKA brand.
Current report
•Increased payroll and related costs of approximately $13,600, primarily due to higher headcount from investments in talent for the HOKA and UGG brands, partially offset by lower variable payroll costs for our owned warehouses and DCs.
Current report
(1) Includes Sanuk brand financial results from April 1, 2024 through the Sanuk Brand Sale Date for the six months ended September 30, 2024, which are presented in the Other brands reportable operating segment.
Current report
•The increase in income from operations of the UGG brand was due to higher net sales at higher gross margins, partially offset by higher SG&A expenses as a percentage of net sales, primarily driven by advertising, marketing, and promotion expenses, and other SG&A expenses.
Current report
3PL Agreements. During the six months ended September 30, 2025, we entered into a 3PL service agreement with a non-cancellable minimum commitment of approximately $93,611 through March 31, 2029, related to the transition of one of our international 3PLs to a new partner with an upgraded warehouse management system which we expect to be operational in the first quarter of our next fiscal year.
Current report
Operating Lease Obligations. During the six months ended September 30, 2025, we entered into various operating leases agreements in the ordinary course of business to continue the investment in our global retail store footprint, which are recorded on a discounted basis in our condensed consolidated financial statements. Refer to Part I, Item 1, Note 5, "Commitment and Contingencies," for further information on our operating lease obligations.
Current report
Investing Activities. The increase in net cash used in investing activities during the six months ended September 30, 2025, compared to the prior period, was primarily due to cash proceeds from the sale of assets during the prior period. The purchases of property and equipment relate to investments in our global retail store footprint, partially offset by lower expenditures for the completed build-out of an owned US warehouse and DC.
Removed paragraphs (17)
Previous report
Refer to the section below entitled “Reportable Operating Segments Overview” for information on recent developments with the Koolaburra brand and Sanuk brand.
Previous report
•Net sales increased 16.9% to $964,538.
Previous report
▪Wholesale channel net sales increased 26.7% to $652,364.
Previous report
▪DTC channel net sales increased 0.5% to $312,174.
Previous report
▪Domestic net sales decreased 2.8% to $501,258.
Previous report
▪International net sales increased 49.7% to $463,280.
Previous report
•SG&A expenses increased 10.5% to $372,619.
Previous report
•Income from operations increased 24.5% to $165,287.
Previous report
•Operating margin increased 110 basis points to 17.1%.
Previous report
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 report
In addition, we completed the sale of the Sanuk brand during the second quarter of our prior fiscal year. The financial results for our reportable operating segments present the former Sanuk brand within the Other brands reportable operating segment through the brand’s sale date, August 15, 2024.
Previous report
(1) Includes Sanuk brand financial results for the three months ended June 30, 2024, which are presented in the Other brands reportable operating segment.
Previous report
•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 report
•Increased other SG&A expenses of approximately $15,000, primarily due to higher HOKA brand expenses of approximately $8,500 primarily for other variable operating expenses, and higher unallocated enterprise and shared brand expenses of approximately $4,500 primarily for variable 3PL service fees related to sales growth.
Previous report
•Increased rent and occupancy of approximately $5,100, primarily due to higher rent expenses resulting from retail store footprint expansion for the HOKA and UGG brands.
Previous report
(1) Includes Sanuk brand financial results for the three months ended June 30, 2024, which are presented in the Other brands reportable operating segment.
Previous report
Investing Activities. Net cash used in investing activities remained relatively unchanged during the three months ended June 30, 2025, compared to the prior period.
Reworded paragraphs (33)
Previous wording
The following discussion of our financial condition and results of operations should be read together with our condensed consolidated financial statements and the related notes included in Part I, Item 1, “Financial Statements,” within this Quarterly Report, and the audited consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of our 2025 Annual Report, filed with the SEC on May 23, 2025, which is available free of charge on the SEC’s website atwww.sec.govand our website atir.deckers.com.
Current wording
The following discussion of our financial condition and results of operations should be read together with our condensed consolidated financial statements and the related notes included in Part I, Item 1, “Financial Statements,” within this Quarterly Report, and the audited consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of our 2025 Annual Report, filed with the SEC on May 23, 2025, which is available free of charge on the SEC’s website atwww.sec.gov and our website atir.deckers.com.
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: 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.
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, Koolaburra, and AHNU. 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 three months ended June 30, 2025, compared to the prior period, were as follows:
Current wording
Consolidated financial performance highlights for the six months ended September 30, 2025, compared to the prior period, were as follows:
Previous wording
▪HOKA brand net sales increased 19.8% to $653,119.
Current wording
▪HOKA brand net sales increased 15.3% to $1,287,205.
Previous wording
▪UGG brand net sales increased 18.9% to $265,092.
Current wording
▪UGG brand net sales increased 12.3% to $1,024,679.
Previous wording
▪Other brands net sales decreased 19.0% to $46,327.
Current wording
▪Other brands net sales decreased 22.5% to $83,494.
Previous wording
•Gross margin decreased 110 basis points to 55.8%.
Current wording
•Gross margin decreased 30 basis points to 56.0%.
Previous wording
•Diluted earnings per share increased 24.0% to $0.93 per share.
Current wording
•Diluted earnings per share increased 17.1% to $2.74 per share.
Previous 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.
Current wording
Other Brands. Other brands consist primarily of the Teva brand, Koolaburra brand, and AHNU 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.
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 2025 Annual Report for detailed information regarding the impacts of seasonality on 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 additional information regarding the impacts of seasonality on our business.
Previous wording
•On a constant currency basis, net sales increased by 16.3% compared to the prior period.
Current wording
•On a constant currency basis, net sales increased by 8.3%, compared to the prior period.
Previous wording
•Comparable DTC channel net sales for the 13 weeks ended June 29, 2025, decreased by 2.2%, compared to the prior period.
Current wording
•Comparable DTC channel net sales for the 13 weeks ended September 28, 2025, decreased by 2.9%, compared to the prior period.
Previous wording
•We experienced an increase of 15.7% in the total volume of units sold to 14,700 from 12,700, compared to the prior period. Units sold include all categories such as footwear, apparel, accessories, home goods, and care kits.
Current wording
•We experienced an increase of 6.6% in the total volume of units sold to 22,700 from 21,300, compared to the prior period. Units sold include all categories such as footwear, apparel, accessories, home goods, and care kits.
Previous 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.
Current wording
•Increased advertising, marketing, and promotion expenses of approximately $11,400, primarily due to higher promotional marketing expenses for the UGG and HOKA brands to drive global brand awareness and market share gains, highlight new product categories, and provide localized marketing.
Previous wording
•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.
Current wording
•Decreased net foreign currency-related remeasurement gains of approximately $10,000, primarily due to less favorable changes in Asian and Canadian exchange rates against the US dollar.
Previous wording
•Increased payroll and related costs of approximately $8,900, primarily due to higher headcount from talent investment for the HOKA and UGG brands, including for retail stores, partially offset by lower unallocated shared brand payroll and related costs, including for our owned warehouses.
Current wording
•Increased payroll and related costs of approximately $4,700, primarily due to higher headcount from investments in talent for the HOKA and UGG brands, partially offset by lower variable payroll costs for our owned warehouses and DCs.
Previous wording
•The increase in income from operations of the HOKA brand was due to higher net sales, partially offset by lower gross margins and higher SG&A expenses as a percentage of net sales, primarily reflecting increased headcount, rent and occupancy, and marketing to support brand growth initiatives.
Current wording
•The increase in income from operations of HOKA brand was due to higher net sales, partially offset by lower gross margins, as well as higher SG&A expenses as a percentage of net sales primarily driven by payroll and related costs, rent and occupancy, and other SG&A expenses.
Previous wording
•The decrease in unallocated enterprise and shared brand expenses was primarily due to higher net foreign currency-related remeasurement gains and lower payroll and related costs, partially offset by higher other SG&A expenses for variable 3PL service fees related to sales growth.
Current wording
•The increase in unallocated enterprise and shared brand expenses was due to lower net foreign currency-related remeasurement gains, higher rent and occupancy for our owned warehouses and DC's, and higher costs for infrastructure investments and related depreciation, partially offset by lower variable payroll costs for our owned warehouses and DCs and lower other SG&A expenses for travel expenses, legal expenses, and other miscellaneous expenses.
Previous 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.
Current wording
The net decrease in our effective income tax rate, compared to the prior period, was primarily due to non-recurring changes in valuation allowances on tax attributes, net discrete tax benefits for audit settlements and adjustments to income taxes payable, and changes in jurisdictional mix of worldwide income before income taxes, partially offset by reduced tax benefits for stock-based compensation.
Previous 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.
Current wording
Net Income. The increase in net income, compared to the prior period, was due to higher net sales at higher gross margins, partially offset by higher SG&A expenses as a percentage of net sales. 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
•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.
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 key product franchises, as well as earlier shipments primarily related to the transition of our European 3PL. These impacts were partially offset by lower net sales in the DTC channel which has been pressured by earlier wholesale channel shipments, particularly with consumer preferences shifting toward multi-brand shopping experiences.
Previous wording
•Net sales of the Other brands decreased primarily due to the sale of the Sanuk brand in August 2024.
Current wording
•Net sales of the Other brands decreased primarily due to lower US net sales in the wholesale channel driven by the phase-out of standalone operations of the Koolaburra brand and the sale of the Sanuk brand in August 2024.
Previous 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).
Current wording
•As of September 30, 2025, we have a total of 200 global Company-owned retail stores (including 145 UGG brand retail stores and 55 HOKA brand retail stores).
Previous wording
Gross Profit. Gross margin decreased to 55.8% from 56.9% compared to the prior period, primarily due to unfavorable channel mix as wholesale revenue growth outpaced DTC revenue growth, higher promotional activity for the UGG and HOKA brands, and unfavorable changes in freight costs, partially offset by favorable product mix shifts, as well as favorable foreign currency exchange rate fluctuations.
Current wording
Gross Profit. Gross margin decreased to 56.0% from 56.3% compared to the prior period, primarily due to unfavorable channel mix as wholesale revenue growth outpaced DTC revenue growth, higher promotional activity for the HOKA brand, as well as incremental tariffs on US goods impacting the current fiscal quarter, partially offset by favorable product mix shifts, benefits from price increases, and favorable foreign currency exchange rate fluctuations. The net impact of tariff-related variables was not material in the current period due to the timing of the implementation of our mitigation strategies, including price increases and earlier inventory shipments in advance of the incremental tariffs.
Previous wording
•The increase in income from operations of the UGG brand was due to higher net sales and lower SG&A expenses as a percentage of net sales, primarily related to payroll and related costs, rent and occupancy, and other SG&A expenses, partially offset by lower gross margins.
Current wording
•The increase in income from operations of the HOKA brand was due to higher net sales, partially offset by lower gross margins and higher SG&A expenses as a percentage of net sales, primarily driven by payroll and related costs, rent and occupancy, and other SG&A expenses.
Previous 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.
Current wording
Cash and Cash Equivalents. As of September 30, 2025 and March 31, 2025, our cash and cash equivalents balance is $1,414,479 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 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.
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 six months ended September 30, 2025, and 2024, no cash and cash equivalents were repatriated from a foreign subsidiary that were subject to income taxes. As of September 30, 2025, and March 31, 2025, we have $366,296 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.
Previous 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.
Current wording
•Primary Credit Facility. During the six months ended September 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 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.
Current wording
•China Credit Facility. During the six months ended September 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
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.
Current wording
Contractual Obligations and Capital Expenditures. Except for the above, as of September 30, 2025, 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.
Previous 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.
Current wording
Stock Repurchase Program. As of September 30, 2025, the aggregate remaining approved amount under our stock repurchase program is $2,159,714. 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
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.
Current wording
The increase in net cash provided by operating activities during the six months ended September 30, 2025, compared to the prior period, was due to $51,227 of favorable net income after non-cash adjustments partially offset by $29,094 of unfavorable changes in operating assets and liabilities. Changes in operating assets and liabilities were primarily due to unfavorable impacts from (1) timing of derivative contract cash settlements, (2) higher cost and earlier purchases of inventory to support elevated demand for our products and the transition to our European 3PL, partially offset by favorable impacts from (3) net trade accounts receivable from timing of sales and respective receipts, (4) net trade accounts payable from timing of receipts of goods and services and related disbursements, and (5) timing of tax payments and receipts.
Previous 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.
Current wording
Financing Activities. The increase in net cash used in financing activities during the six months ended September 30, 2025, compared to the prior period, was due to a higher dollar value of stock repurchases, inclusive of excise taxes.
Rearranged current paragraphs (15)
Current report — wording carried from elsewhere
Total net sales increased primarily due to higher net sales for the UGG and HOKA 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:
Current report — wording carried from elsewhere
(2)The change in reportable operating segments had an impact on segment income from operations, a measure of segment profitability, and a clarification was made that certain prior unallocated overhead costs are defined as unallocated enterprise and shared brand expenses and are excluded from the measure of segment profitability.
Current report — wording carried from elsewhere
The increase in total income from operations, compared to the prior period, was primarily due to higher net sales at higher gross margins, partially offset by higher SG&A expenses as a percentage of net sales. Drivers of significant net changes in total income from operations, compared to the prior period, were as follows:
Current report — wording carried from elsewhere
Six Months Ended September 30, 2025, Compared to Six Months Ended September 30, 2024. Results of operations were as follows:
Current report — wording carried from elsewhere
(1)May not calculate on rounded amounts.
Current report — wording carried from elsewhere
Net Sales. Net sales by brand, channel, and geography were as follows:
Current report — wording carried from elsewhere
•On a constant currency basis, net sales increased by 11.4% compared to the prior period.
Current report — wording carried from elsewhere
•Comparable DTC channel net sales for the 26 weeks ended September 28, 2025, decreased by 2.6%, compared to the prior period.
Current report — wording carried from elsewhere
•We experienced an increase of 10.0% in the total volume of units sold to 37,400 from 34,000, compared to the prior period. Units sold include all categories such as footwear, apparel, accessories, home goods, and care kits.
Current report — wording carried from elsewhere
Selling, General, and Administrative Expenses. Drivers of significant net changes in SG&A expenses, compared to the prior period, were as follows:
Current report — wording carried from elsewhere
•Increased advertising, marketing, and promotion expenses of approximately $24,700, 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 report — wording carried from elsewhere
Income from Operations. Income (loss) from operations by reportable operating segment was as follows:
Current report — wording carried from elsewhere
Income Tax Expense. Income tax expense and our effective income tax rate were as follows:
Current report — wording carried from elsewhere
The net decrease in our effective income tax rate, compared to the prior period, was primarily due to non-recurring changes in valuation allowances on tax attributes, net discrete tax benefits for audit settlements and adjustments to income taxes payable, and changes in jurisdictional mix of worldwide income before income taxes, partially offset by reduced tax benefits for stock-based compensation and reserve adjustments.
Current report — wording carried from elsewhere
Net Income. The increase in net income, compared to the prior period, was due to higher net sales and lower SG&A expenses as a percentage of net sales, partially offset by lower gross 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.