- With a greater focus on the channel, Deckers saw third-quarter direct-to-consumer net sales from its brand portfolio increase 18.7% year over year, reaching $699.3 million, according to a press release Thursday. Company revenue was up 13.3%, and wholesale net sales increased 8% to $646.3 million. Meanwhile, inventories were up about 31% year over year, going from $550.7 million to $723.4 million.
- The company’s Ugg brand saw a net sales decrease of 1.6% to $930.4 million, while Hoka experienced a 90.8% increase to $352.1 million and Teva had a 48.3% increase to $30.5 million for the quarter.
- “Our brands delivered another stellar quarter, led by record results for both HOKA as well as our consolidated direct-to-consumer business,” Deckers CEO and President Dave Powers said in a statement.
Although Ugg saw decreased sales during Q3, Powers emphasized the brand’s strength through its DTC channels during a call with analysts.
“The brand continues to attract new consumers and drive more business through direct-to-consumer with their loyalty program that now has amassed over 7 million members worldwide,” Powers said, and added that the brand’s “healthy DTC performance was offset by unfavorable foreign currency exchange rate impacts across all channels as well as lower wholesale revenue. This wholesale decline resulted from the unique shipment timing dynamics discussed at the outset of this fiscal year, which included an expectation that the third quarter would be impacted.”
The chief executive said Ugg’s business mix increased from 54% DTC last year to 60%, with the channel’s gains spanning across gender and category.
As for the athletic’s brand Hoka, consumer acquisition increased by 95% according to Powers, who noted that its Fly Human Fly marketing campaign has been a key component of the brand’s DTC growth. A “broad product adoption from females” in the 18 to 34-year-old demographic was encouraging to Powers, with the group more actively searching for new products on the brand’s DTC website.
Deckers has been “very selective” with the wholesale partners it sells Hoka through, according to Powers. Although it can be found at select REi and Dick’s Sporting Goods locations, the CEO said it is not looking to expand that footprint too much and will “ultimately drive as much business as we can through DTC because for all the right reasons: margin, consumer data, lifetime value.” The company has a goal of being 50% DTC across the entire portfolio for the fiscal year.
The Hoka brand began testing out its own brick-and-mortar strategy in 2021, with the opening of two pop-up shops in the Flatiron District of New York City and on Melrose Avenue in Los Angeles. In June of last year, Deckers’ chief operating officer stepped down, and the company also created a new chief supply chain officer role with the promotion of Angela Ogbechie.