Is Deckers' Wholesale Channel the Key Driver of Its Growth Momentum?

Deckers Outdoor Corporation DECK reported a strong performance in its wholesale business in the first quarter of fiscal 2026, with wholesale net sales increasing 26.7% year over year to $652.4 million. This growth was driven primarily by the performances of the HOKA and UGG brands.

HOKA’s wholesale revenues rose 30%, driven by robust sell-in, expanded distribution and strong reorders, fueled by high sell-through, particularly in EMEA and APAC. In the United States, wholesale remained steady, supported by increased demand for in-store retail experiences.

UGG's wholesale revenues also increased 30% from the prior year, with gains spread across both domestic and international markets. The EMEA region and China were standout performers, driven by early fulfillment of fall orders and replenishment of depleted inventories. Men’s footwear, sandals, and sneakers — key parts of UGG’s 365 product initiative — helped boost wholesale demand. Retail partners responded with confidence, reflecting high consumer interest and order volumes heading into the rest of the fiscal year.

Throughout the first quarter, Deckers noted that sell-through continued to outpace sell-in across wholesale accounts, which underscores effective inventory management and healthy consumer demand. HOKA, in particular, saw record wholesale reorders in Europe and continued its retail expansion in China through partner and owned stores, helping build market presence and brand recognition.

Looking ahead, wholesale is expected to grow faster than the DTC channel, supported by evolving consumer preferences favoring in-person retail and strong partner engagement. Deckers’ ability to align wholesale execution with market demand and retail dynamics positions the business for continued momentum through the remainder of the fiscal year.

DECK’s Competition in the Wholesale Channel

Steven Madden, Ltd. SHOO and Urban Outfitters Inc. URBN are the key footwear companies competing with Deckers in the wholesale channel.

Steven Madden’s wholesale channel generated $360.6 million in second-quarter 2025, down 6.4% year over year. Excluding Kurt Geiger, revenues fell 12.8% due to order cancellations, shipment delays and tariff impacts. Mass and off-price channels were most affected. The wholesale gross margin declined to 31% from 33.1%, reflecting Steven Madden’s increased landed costs despite selective price increases and sourcing shifts.

Urban Outfitters' wholesale channel achieved a 24% revenue increase in first-quarter fiscal 2026, driven by strong full-price sales, particularly from Free People and FP Movement. It noted significant profitability improvement in the segment, supported by strong demand from specialty and department stores, highlighting Urban Outfitters' growing strength and strategic wholesale execution.

DECK’s Price Performance, Valuation & Estimates

Shares of Deckers have lost 49.1% year to date compared with the industry’s decline of 14%.

From a valuation standpoint, DECK trades at a forward price-to-earnings ratio of 16.05X, below the industry’s average of 17.43X. It has a Value Score of A.

The Zacks Consensus Estimate for DECK’s fiscal 2026 earnings implies a year-over-year decline of 1.1%, whereas the same for fiscal 2027 indicates an uptick of 8.3%. The estimates for fiscal 2026 and 2027 have been upbound by 21 cents and 17 cents, respectively, in the past 30 days.

DECK currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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