Deckers shares soar on rising demand for Hoka, UGG footwears in China, Europe (updated)

On Holding AG

25/07/2025 14:56

Updates shares in paragraph 1, adds analyst comment in paragraph 5

By Juveria Tabassum

July 25 (Reuters) - Deckers Outdoor DECK.N beat first-quarter revenue and profit estimates on resilient demand for its sneakers and boots in international markets, sending the shares of the Hoka parent surging 18% on Friday.

Solid demand for Hoka shoes and UGG boots in Europe and China shielded Deckers from the impact of tariff-related concerns and sticky inflation on consumer spending in the U.S., its largest market by revenue.

"Coming off a spectacular fiscal 2025, Deckers faces uneven U.S. sportswear demand, higher tariffs on imports and tough comparisons after strong Hoka wholesale sell-in last year," said Morningstar analyst David Swartz in a note.

"Yet, it is capitalizing on large international opportunities, and its brands remain popular."

International market sales nearly doubled from a year ago, benefiting from the company opening its own stores in China and Europe.

"Deckers' first-quarter beat across top line and margin should drive a relief rally against heightened uncertainty," said BTIG analyst Janine Stichter.

The company's U.S. sales growth for the first quarter, however, slowed to 2.8% from about 11% in the prior quarter, while it refrained from providing full-year targets again due to tariff-related uncertainty.

Deckers also warned that its margins in the second half would take a hit from 20% U.S. tariffs on Vietnam from where it sources most of its shoes.

Its first-quarter results were strong, but the lack of visibility in fiscal 2026 and growing tariff pressure remain a concern, said Telsey Advisory Group analyst Dana Telsey.

While shares of Roger Federer-backed On Holding ONON.N rose about 2% on Deckers' strong results, Puma's PUMG.DE stock dropped 16% after the German sportswear brand gave a bleak annual forecast.

Deckers' stock is trading at 16.13 times analysts' average estimate for its earnings for the next 12 months, compared with Nike's NKE.N 34.85 and Puma's 18.86.

 (Reporting by Juveria Tabassum in Bengaluru; Editing by Leroy Leo and Arun Koyyur)

 ((Juveria.Tabassum@thomsonreuters.com;))