CEO and President Dave Powers said on a call with analysts Thursday that the quarter\u2019s results \u201cgive us increased confidence\u201d to achieve its fiscal year 2024 outlook, which was slightly raised with net sales expected to be about $3.98 billion from a previously projected $3.95 billion.<\/li>\n<\/ul>\nDive Insight:<\/h3>\n
With Hoka leading the company\u2019s growth, direct-to-consumer remains a core focus for Deckers.\u00a0<\/p>\n
“Deckers begins fiscal year 2024 in a position of strength, accelerating towards our outlook for the full year, which has been raised to reflect Hoka brand momentum,” Powers said in a statement.\u00a0“We remain dedicated to delivering results in alignment with our strategic focus to grow DTC and build our presence within international markets.\u201d<\/p>\n
Powers said on Thursday\u2019s call that the company remains focused on building Hoka into a multibillion-dollar brand. The executive said in May that the company expects Hoka to reach $2 billion in sales \u201cpretty soon.\u201d Hoka\u2019s performance during the quarter was primarily driven by DTC growth, which increased by 63% year over year.<\/p>\n
While Hoka\u2019s DTC business is mostly from e-commerce sales, Powers said that its retail stores are helping to increase brand awareness and engagement with the use of community-oriented experiences in key markets.<\/p>\n
\u201cFor these reasons, we expect to continue testing potential permanent locations through pop-up stores. We are excited about a couple of new doors that are in the pipeline and look forward to sharing more soon,\u201d the chief executive said.\u00a0<\/p>\n
Overall, Deckers\u2019 first quarter remained strong, though the market\u2019s expectations for Hoka might need review, according to Wedbush<\/span> analysts led by Tom Nikic.<\/span><\/p>\n\u201c[Deckers] continues to perform well in a challenging macro environment, we think numbers for FY24 could continue to move higher as the year progresses, but there might not be quite as much upside potential as we thought at Hoka,\u201d the analysts said in emailed comments.\u00a0\u201cWhile the slower Hoka growth is partially due to management’s prudence around wholesale distribution (which we think is the right thing for long-term brand health), the market is going to need to recalibrate its expectations for Hoka in the near-term … We remain encouraged by the outstanding DTC growth, however, which shows that the brand is still resonating with consumers.\u201d<\/p>\n<\/p><\/div>\n
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