DECKERS OUTDOOR CORP
For the period ended Mar 31, 2026. Filed May 22, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed May 22, 2026
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-K
Period ended 2025-03-31; filed 2025-05-23.
0000910521-25-000017
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-03-31; filed 2026-05-22.
0001628280-26-037664
Item 7. 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.
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18 unchanged; 84 reworded; 244 added; 72 removed; 6 previous and 155 current paragraphs rearranged.
Tables are not compared: 11 previous and 6 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 (244)
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Report on Form 10-K for thefiscal year ended March 31, 2025, filed with the SEC on May 23, 2025.
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Report.
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“domestic” refer to the US.
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under three proprietary brands: HOKA, UGG, and Teva. Refer to the section below entitled “Reportable Operating
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Segments Overview” for information regarding the phase out of standalone operations for the Koolaburra brand and
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AHNU brand, and the prior sale of the Sanuk brand.
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quality domestic and international retailers and international distributors inour wholesale channel, and directly to
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•Net sales increased 9.8% to$5,472,296.
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▪HOKA brand net sales increased 15.9% to$2,587,330.
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▪UGG brand net sales increased 8.2% to$2,738,758.
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▪Wholesale channel net sales increased 12.3% to$3,208,107.
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▪DTC channel net sales increased 6.3% to$2,264,189.
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▪Domestic net sales increased 0.2% to$3,191,518.
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▪International net sales increased 26.8% to$2,280,778.
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•Gross profit as a percentage of net sales (gross margin)decreased 20 basis points to 57.7%.
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Table of Contents 33
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•SG&A expenses increased 11.0% to$1,894,823.
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•Income from operations increased 7.1% to$1,262,903.
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to 23.1%.
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high interest rates, foreign currency exchange rate volatility, escalating global conflicts, changes in
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for our business and industry that may continue to pressure our results of operations, including our
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gross margin. For example, prolonged orescalating conflicts in the Middle East could disrupt our
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supply chain and increase energy, transportation, and commodity costs, as well as cause shipping
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period, they could negatively affect us in future periods.
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affecting goods imported from certain regions where we have a concentration of sourcing and
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manufacturing. Recent judicial, regulatory, and administrative developments regarding tariffs
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imposed under the International Emergency Economic Powers Act and other authorities have
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increased uncertainty related to both our future duty costs and potential recovery of previously paid
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duties. The US Customs and Border Protection have announced a phased process for submitting
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refund requests; however, the availability, timing, and amount of any refunds remain uncertain. As
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of March 31, 2026, we have not recognized any amounts related to potential tariff refunds or other
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recoveries. We continue to monitor developments and pursue mitigation strategies, including
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selective pricing actions, inventory and sourcing management, supplier diversification, and
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impacts, which could materially and adversely affect ourgross margin and demand for our
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products.
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Brand and Omnichannel Strategy
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brands, which has contributed positively to our results of operations. Our global brand growth
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strategy seeks to drive adoption through product innovation and marketing investments across
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geographies and channels, while enhancing thecustomer experience through category expansion
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and loyalty-driven engagement.
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•Net sales increased 16.3% to $4,985,612.
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▪UGG brand net sales increased 13.1% to $2,531,351.
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▪HOKA brand net sales increased 23.6% to $2,233,090.
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▪Wholesale channel net sales increased 17.4% to $2,855,865.
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▪DTC channel net sales increased 14.8% to $2,129,747.
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▪Domestic net sales increased 11.3% to $3,186,709.
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▪International net sales increased 26.3% to $1,798,903.
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•Gross margin increased 230 basis points to 57.9%.
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•SG&A expenses increased 17.1% to $1,706,571.
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•Income from operations increased 27.1% to $1,179,092.
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RECENT DEVELOPMENTS
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Koolaburra Brand. During the third quarter of fiscal year 2025, 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. 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. Refer to the section titled “The Company,” in Note 1, “General,” of our consolidated financial statements in Part IV within this Annual Report for further information.
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Sanuk Brand Asset Sale. During the second quarter of fiscal year 2025, we completed the sale of the Sanuk brand and certain related assets. Refer to the section below titled “Reportable Operating Segment Overview” for further information on our results of operations. Refer to the section titled “The Company,” in Note 1, “General,” of our consolidated financial statements in Part IV within this Annual Report for further information on the sale of the Sanuk brand.
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Forward Stock Split and Authorized Share Increase. On September 13, 2024, we effected a stock split and an authorized share increase. Our financial results included within this Annual Report have been retroactively adjusted to reflect the effectiveness of the stock split and the authorized share increase. Refer to the section titled “Basis of Presentation,” in Note 1, “General,” of our consolidated financial statements in Part IV within this Annual Report for further information.
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Brand and Omni-Channel Strategy
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Change in Reportable Operating Segments. During the fourth quarter of fiscal year 2025, the financial information regularly used by the CODM to evaluate performance, make operating decisions, and allocate resources was revised. In connection with executive leadership alignment, and the recent divestiture and phase out of certain brands, the CODM shifted resource allocation decisions and performance assessment to a brand focus, rather than a distribution channel focus. This resulted in a change in our reportable operating segments. The change in reportable operating segments had an impact on segment income from operations, a measure of segment profitability, and we clarified unallocated overhead costs excluded from this measure as unallocated enterprise and shared brand expenses. Unallocated enterprise and shared brand expenses are costs that are managed centrally and not specific to any one brand. These costs are primarily comprised of certain payroll and related expenses, including stock-based compensation; global IT expenses; 3PL service fees; depreciation, rent, and occupancy for owned warehouses and offices; and other SG&A expenses, such as costs for contract services, materials, supplies, and travel. These costs span multiple functions including owned warehouses and 3PL service fees, along with enterprise costs which include centralized commercial operations, IT, finance, human resources, legal, supply chain, and corporate executives.
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Previously, our six reportable operating segments included the worldwide wholesale operations of the UGG brand, HOKA brand, Teva brand, Sanuk brand, and Other brands (primarily the AHNU brand and Koolaburra brand), and DTC. Reportable operating segment results for all prior periods presented in this Annual Report have been recast to reflect the change in reportable operating segments.
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As discussed under the section titled “Recent Developments” above, the sale of the Sanuk brand was completed during fiscal year 2025. The financial results for our reportable operating segments present the former Sanuk brand within the Other brands reportable operating segment through the Sanuk Brand Sale Date for the year ended March 31, 2025, and full financial results for the years ended March 31, 2024, and 2023.
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•Leading performance product innovation, category extensions, and key franchise management, including higher frequency product drop rates and improving accessibility to all athletes.
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•Category extensions in authentic performance footwear offerings such as lifestyle, trail, and fitness categories.
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USE OF NON-GAAP FINANCIAL MEASURES
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RESULTS OF OPERATIONS
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(2) Includes Teva brand full financial results for the year ended March 31, 2025, and the prior period, which are presented in the Other brands reportable operating segment. Refer to the section titled “Reportable Operating Segments Overview” above for further information on the recent change in our reportable operating segments.
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•Net sales of the HOKA brand increased due to higher global demand for an assortment of performance products across all channels. HOKA brand wholesale channel growth was driven primarily by global market share gains and benefits from new points of distribution with key partners. HOKA brand DTC channel growth was driven primarily by global gains in consumer acquisition and retention.
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•Net sales of the UGG brand increased due to higher global demand across both channels, especially internationally. UGG brand wholesale channel growth was primarily driven by demand for year-round key product franchises and strong partnerships with brand-enhancing retailers. UGG brand DTC channel growth was primarily driven by global gains in consumer acquisition and retention.
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Gross Profit. Gross margin increased to 57.9% from 55.6%, compared to the prior period, primarily due to favorable brand and product mix, with higher margin product driving a higher proportion of growth, and increased levels of full-price selling primarily for the UGG brand, including reduced closeouts to the wholesale channel, partially offset by unfavorable changes in freight costs.
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•Increased other SG&A expenses of approximately $79,800, primarily due to higher unallocated enterprise and shared brand expenses of approximately $46,400 for 3PL service fees, contract services, IT programming and software costs, and other operating expenses; higher HOKA brand expenses of approximately $22,700 for materials and supplies, sales commissions, travel costs, bad debt expenses, credit card fees, and other operating expenses; and higher UGG brand expenses of approximately $9,700 for sales commissions, bad debt expenses, and credit card fees.
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•Increased payroll and related costs of approximately $67,800, primarily due to higher headcount from investments in talent for the HOKA brand, enterprise functions, and the UGG brand, along with higher variable payroll costs to support higher sales.
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•Increased depreciation and other related costs of approximately $10,800, primarily due to higher unallocated enterprise and shared brand expenses for infrastructure investments and related depreciation, partially offset by lower impairments.
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•Increased net foreign currency-related remeasurement gains of approximately $2,000, primarily due to favorable changes in Asian exchange rates against the US dollar.
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(1) Includes Sanuk brand partial financial results through the Sanuk Brand Sale Date of August 15, 2024, for the year ended March 31, 2025, and full financial results for the prior period, which are presented in the Other brands reportable operating segment. Refer to the section titled “Recent Developments” above for further information on the sale of the Sanuk brand. Refer to the section titled “Reportable Operating Segments Overview,” above for further information on the recent change in our reportable operating segments.
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(2) Includes Teva brand full financial results for the year ended March 31, 2025, and the prior period, which are presented in the Other brands reportable operating segment. Refer to the section titled “Reportable Operating Segments Overview” above for further information on the recent change in our reportable operating segments.
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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.
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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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•The increase in income from operations of the Other brands was due to higher gross margins on lower net sales, as well as the benefit to SG&A expenses from lower impairments compared to the prior period for the Sanuk brand definite-lived intangible assets.
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•The increase in unallocated enterprise and shared brand expenses was due to higher other SG&A expenses for 3PL service fees, contract services, and IT programming and software costs; higher payroll and related costs for higher variable payroll costs along with higher headcount for enterprise functions; and higher depreciation and other related costs for infrastructure investments.
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Total Other Income, Net. The increase in total other income, net, compared to the prior period, was primarily due to higher interest income from higher invested cash balances.
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The net decrease in our effective income tax rate, compared to the prior period, was primarily due to benefits related to US tax on foreign earnings (including global intangible low-tax income and foreign derived intangible income), partially offset by higher income tax expense from changes in jurisdictional mix of worldwide income before income taxes and a lower benefit from net discrete items, including from return-to-provision adjustments and a valuation allowance on tax attributes.
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(1) Includes Teva and Sanuk brand’s full financial results for the years ended March 31, 2024, and 2023, which are presented in the Other brands reportable operating segment. Refer to the section titled “Reportable Operating Segments Overview,” above for further information on the recent change in our reportable operating segments.
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Total net sales increased primarily due to higher global net sales across all channels for the HOKA and UGG brands, partially offset by lower net sales for Other brands across all channels. Drivers of significant changes in net sales, compared to the year ended March 31, 2023, were as follows:
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The following discussion of our financial condition and results of operations should be read together with our consolidated financial statements in Part IV within this Annual Report. This discussion includes an analysis of our financial condition and results of operations for the years ended March 31, 2025, 2024, and 2023 and year-over-year comparisons between those periods.
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The following discussion of our financial condition and results of operations should be read together with our
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Certain statements made in this section constitute “forward-looking statements,” which are subject to numerous risks and uncertainties. Our actual results of operations may differ materially from those expressed or implied by these forward-looking statements as a result of many factors, including those set forth in the section titled “Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A, “Risk Factors,” within this Annual Report.
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Certain statements made in this section constitute “forward-looking statements,” which are subject to numerous
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Unless otherwise indicated, all figures herein are expressed in thousands, except for per share and share data.
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Unless otherwise indicated, all figures herein are expressed in thousands, except per share data. References to
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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, 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, international distributors, 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.
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We are a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories
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Consolidated financial performance highlights for fiscal year 2025, compared to fiscal year 2024 (the prior period), were as follows:
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Consolidated financial performance highlights forfiscal year 2026 (current period), compared tofiscal year 2025
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▪Other brands net sales decreased 8.6% to $221,171.
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▪Other brands net sales decreased 33.9% to $146,208.
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•Income from operations as a percentage of net sales (operating margin) increased 200 basis points to 23.6%.
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•Income from operations as a percentage of net sales (operating margin) decreased 50 basis points
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•Diluted earnings per share increased 30.2% to $6.33 per share.
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•Diluted earnings per share increased 10.9% to$7.02 per share.
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We expect our business and industry will continue to be impacted by several important trends and uncertainties, including the following:
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Our business and industry are subject to several important trends and uncertainties, including the following:
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•Macroeconomic factors, including inflationary pressures, increased tariffs, geopolitical unrest, and escalating global conflicts, are creating a complex and challenging environment for our business and industry. While these factors did not materially impact our business or results of operations during fiscal year 2025, the full impact of these factors is difficult to quantify and could negatively impact us in future periods.
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•Macroeconomic factors, including inflationary pressures, increased tariffs, rising supply chain costs,
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•We are exposed to risks resulting from evolving US trade policy that has introduced uncertainty and volatility in global trade relations, including higher tariffs and greater restrictions on goods imported from certain regions. While we pursue mitigation strategies, including through selective, staggered, and strategic price increases on our products sold in the US and by negotiating cost-sharing arrangements with our independent manufacturers, we may be unable to offset all resulting increases to our cost of goods sold. These risks may have a material adverse impact on demand for our products.
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•We are exposed to risks from evolving trade policies, including higher tariffs and restrictions
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•We remain focused on increasing global consumer awareness and adoption of our brands, which has continued to positively impact our financial results. Our efforts to drive brand adoption are focused on building brand acceptance and heat through launches of innovative product offerings, coupled with marketing investments across multiple geographic markets and channels of distribution, including strategic expansion of the global marketplace.
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•We are focused on increasing global consumer awareness, cultural relevance, and adoption of our
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•We continue to implement a marketplace inventory management strategy for our brands through segmentation and differentiation. During fiscal year 2025, we continued to experience alignment on product assortments that resulted in higher full-price sell-through, which benefited our gross margins across all channels of distribution. While gross margins continue to be an area of strategic focus, we may not experience these benefits to our gross margins in our fiscal year ending March 31, 2026 (next fiscal year) due to various factors, including impacts from macroeconomic and geopolitical factors, discussed above, as well as potential impacts from our pricing strategies.
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March 31, 2027 (next fiscal year) due to various factors, including the macroeconomic and
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•Our long-term strategy remains focused on building our DTC channel to represent an increased proportion of our total net sales, which includes differentiating the consumer experience from the wholesale channel to drive increases in acquisition and retention to sustain strong market positions and a high level of demand for our brands. We expect increased sales in the DTC channel will continue to positively impact our gross margins. However, as we expand doors with wholesale partners to drive brand awareness and market share in the near-term, our wholesale channel may represent a higher portion of our total net sales in certain periods, which could pressure our margins in those periods.
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•Our long-term strategy is to grow our DTC channel to represent a larger portion of our total net
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•We continue to implement our international growth strategies for the HOKA and UGG brands to represent an increased proportion of our total net sales. We continue to selectively expand our HOKA brand presence through additional locations with our wholesale partners and targeted retail store expansion within our DTC channel. We also continue to invest in certain regions that provide influential market presence to build HOKA brand awareness, and we expect to continue making these investments, including in our next fiscal year. We continue to emphasize elevating the customer experience for our brands through category expansion and collaborations.
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to represent a larger portion of our total net sales. We continue to selectively expand our HOKA
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•To support our growing business, we continue to invest in our network of global warehouses, DCs, and 3PLs, which have fixed and variable costs, with variable costs changing relative to changes in net sales. We continue to diversify our third-party manufacturers and the regions in which they operate. We are currently negotiating the transition of one of our international 3PLs to a new partner with an upgraded warehouse management system during our next fiscal year. We expect to continue to invest in and build upon these infrastructure capabilities to continue meeting customer and consumer demand.
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manufacturers and the regions in which they operate; however, we maintain a significant
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As of March 31, 2025, our three reportable operating segments include the worldwide operations of the UGG brand, HOKA brand, and Other brands. Information reported to the CODM, who is our Principal Executive Officer (PEO), is organized into these reportable operating segments and is consistent with how the CODM evaluates our performance and allocates resources.
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As of March 31, 2026, ourthree reportable operating segments include the worldwide operations of the HOKA
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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.
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HOKA Brand. The HOKA brand is an authentic premium line of year-round performance footwear, which offers
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•Increased global brand awareness and new consumer adoption through enhanced global marketing activations and online consumer acquisition, including building a more diverse outdoor community through digital and in-person event sponsorship.
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•Increased global brand awareness and new consumer adoption through enhanced global marketing
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•Thoughtful and strategic distribution choices, allowing the HOKA brand access and introduction to a broader, more diverse, consumer base.
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•Thoughtful and strategic distribution choices, allowing the HOKA brand access and introduction to a
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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.
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UGG Brand. The UGG brand is one of the most iconic and recognized brands in our industry, which highlights our
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•Successful acquisition of a diverse global consumer base, and in particular focusing on key markets, through strategic marketing activations and collaborations that resonate with a fashionable consumer.
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•Successful acquisition of a diverse global consumer base, and focusing on key markets, through
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•High consumer brand loyalty due to elevated brand experiences and consistent delivery of crafted; purposefully built and luxuriously comfortable footwear, apparel, and accessories.
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•High consumer brand loyalty due to elevated brand experiences and consistent delivery of crafted;
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•Diversification of our footwear product offerings, such as our spring and summer lines, as well as expanded category offerings for Men’s products such as the slip-on shoe and sneaker category, and more iconic fashion product for our Classics line, including reimagining existing iconic styles into new categories.
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•Diversification of our footwear product offerings, such as our spring and summer lines, as well as
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•Thoughtful expansion of our apparel and accessories businesses.
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•Continued expansion of our apparel and accessories businesses.
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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.
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Other Brands. Other brands consist primarily of the Teva brand. The Teva brand’s products are built for a range of
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We disclose supplemental financial measures calculated and presented in accordance with generally accepted accounting principles in the United States (US GAAP); however, throughout this Annual Report we provide certain financial information on a non-GAAP basis (non-GAAP financial measures). We providenon-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.
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We disclose supplemental financial measures calculated and presented in accordance with generally accepted
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We calculate our constant currency non-GAAP financial measures for current period financial information, such as total net sales using the foreign currency exchange rates that were in effect during the previous comparable period, excluding the effects of foreign currency exchange rate hedges and remeasurements in theconsolidated financial statements. We also report comparable DTC sales on a constant currency basis for DTC operations that were open throughout the current and prior reporting periods, and we may adjust prior reporting periods to conform to current year accounting policies. The information presented on a constant currency basis, as we present such information, may not necessarily be comparable to similarly titled information presented by other companies, and may not be appropriate measures for comparing our performance relative to other companies. Constant currency measures should not be considered in isolation as an alternative to US dollar measures that reflect current period foreign currency exchange rates or to other financial or operating measures presented in accordance with US GAAP.
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for current period financial information, such as total net sales using the foreign currency exchange rates that were
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A significant part of the UGG brand’s business has historically been seasonal, with the highest percentage of net sales occurring in the third fiscal quarter, which has contributed to variation in results of operations from quarter to quarter. However, we have mitigated the impacts of seasonality by diversifying and expanding product offerings with additional year-round styles. In addition, as the HOKA brand’s net sales, which generally occur more evenly throughout the fiscal year, continue to increase as a percentage of our aggregate net sales, we expect to reduce the impacts of seasonality in future periods.
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A significant part of the UGG brand’s business has historically been seasonal, with the highest percentage of net
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(1) Includes Sanuk brand partial financial results through the Sanuk Brand Sale Date of August 15, 2024, for the year ended March 31, 2025, and full financial results for the prior period, which are presented in the Other brands reportable operating segment. Refer to the section titled “Recent Developments” above for further information on the sale of the Sanuk brand. Refer to the section titled “Reportable Operating Segments Overview,” above for further information on the recent change in our reportable operating segments.
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Segments Overview,” above for further information.
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Total net sales increased primarily due to higher global net sales across all channels for the HOKA and UGG brands, partially offset by lower US net sales for Other brands across all channels. 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 brand and UGG brand, partially offset by
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•Net sales of the Other brands decreased primarily due to lower US net sales across all channels, including impacts from the sale of the Sanuk brand.
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•Net sales of the Other brands decreased primarily due to lower domestic net sales in the whole sale
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•On a constant currency basis, net sales increased by 16.5%, compared to the prior period.
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•On a constant currency basis, net sales increased by 9.0%, compared tothe prior period.
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•Comparable DTC channel net sales for the 52 weeks ended March 30, 2025, increased by 13.4% compared to the prior period.
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•Comparable DTC channel net sales for the 52 weeks ended March 29, 2026, increased by 4.6%,
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•We experienced an increase of 13.5% in the total volume of units sold to 74,100 from 65,300, compared to the prior period. Units sold include all categories such as footwear, apparel, accessories, home goods, and care kits.
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•We experiencedan increase of 6.2% in the total volume of units sold to 78,700 from 74,100,
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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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Selling, General, and Administrative Expenses. Drivers ofsignificant net changes in SG&A expenses, compared to
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•Increased advertising, marketing, and promotion expenses of approximately $83,300, 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 advertising, marketing, and promotion expenses of approximately$63,600, primarily due
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•Increased rent and occupancy of approximately $8,800, primarily due to higher rent expenses resulting from retail store footprint expansion for the HOKA brand.
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•Increased rent and occupancy of approximately$36,700, primarily due to higher rent expenses for
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Income from Operations. Income (loss) from operations by reportable operating segment was as follows:
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Income from Operations. Income (loss) from operations byreportable operating segment was as follows:
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(3) To the extent that consolidated SG&A expenses exceed reportable operating segment SG&A expenses, the costs are recorded in unallocated enterprise and shared brand expenses, which are costs that are managed centrally and not specific to any one brand. 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.
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(2) To the extent that consolidated SG&A expenses exceed reportable operating segment SG&A expenses, the costs are recorded
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consolidated financial statements in Part IV within this Annual Report. This discussion includes an analysis of our
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financial condition and results of operations for theyears ended March 31, 2026, and 2025 and year-over-year
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comparisons between those periods. For an analysis of our financial condition and results of operations for the
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years ended March 31, 2025, and 2024 and year-over-year comparisons between those periods, refer to Part II,
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Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual
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risks and uncertainties. Our actual results of operations may differ materially from those expressed or implied by
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these forward-looking statements as a result of many factors, including those set forth in the section titled
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“Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A, “Risk Factors,” within this Annual
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developed for both everyday casual lifestyle use and high-performance activities. We market our products primarily
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Our brands compete across the fashion and casual lifestyle, performance, running, and outdoor markets. We
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believe our products are distinctive and appeal to a broad demographic. Our brands sell our products through
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global consumers through our DTC channel, which is comprised of an e‑commerce and retail store presence. We
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seek to differentiate our brands and products by offering diverse lines that emphasize fashion, performance,
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authenticity, functionality, quality, and comfort, and products tailored to a variety of activities, seasons, and
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demographic groups. Independent third-party contractors manufacture all of our products.
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(the prior period), were as follows:
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discretionary spending, and recession risks, are creating a complex and challenging environment
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delays. While these factors did not materially impact our results of operations during thecurrent
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negotiating cost-sharing arrangements; however, we may be unable to offset tariff-related cost
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geopolitical factors discussed above and the potential impact from our pricing strategies.
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aswe also seek to expand distribution with wholesale partners to drive brand awareness and
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market share, our wholesale channel may represent a larger portion of our net sales in certain
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periods, which could pressure gross margin in those periods.
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store expansion. We are also investing in regions that provide influential market presence to build
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transitioning one of our international 3PLs to a new partner, which may create temporary
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brand, UGG brand, and Other brands.
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enhanced cushioning and inherent stability with minimal weight. Originally designed for ultra-runners, the brand now
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have fueled both domestic and international sales growth of the HOKA brand, which has quickly become a leading
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brand within run and outdoor specialty wholesale accounts and is growing across its global marketplace. The HOKA
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brand’s product line includes running, trail, hiking, fitness, and lifestyle footwear offerings, as well as apparel and
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activations and online consumer acquisition, including building a connected ecosystem through
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social media platforms, e-commerce, and retail.
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successful track record of building niche brands into consumer-focused fashion lifestyle market leaders. Born on the
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innovative products, and elevated storytelling, the UGG brand has proven to be a highly resilient consumer-focused
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with year-round product offerings that appeal to a growing global audience and a broad demographic.
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strategic marketing activations and collaborations that resonate with a fashionable consumer.
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purposefully built and luxuriously comfortable footwear, apparel, and accessories.
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expanded category offerings for Men’s products such as the slip-on shoe and sneaker category,
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and more iconic fashion product for our Classics line, including reimagining existing iconic styles
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outdoor pursuits and include a variety of footwear options, from classic sandals and shoes to boots. The Other
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Year Ended March 31, 2024, Compared to Year Ended March 31, 2023. Results of operations were as follows:
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Net Sales. Net sales by brand, channel, and geography were as follows:
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•Comparable DTC channel net sales for the 52 weeks ended March 31, 2024, increased by 25.4% compared to the year ended March 31, 2023.
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Selling, General, and Administrative Expenses. Drivers of significant net changes in SG&A expenses, compared to the year ended March 31, 2023, were as follows:
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Income from Operations. Income (loss) from operations by reportable operating segment was as follows:
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Income Tax Expense. Income tax expense and our effective income tax rate were as follows: