AI Takeaway
Deckers Outdoor Corporation delivered a strong fiscal year 2026 with revenue growing 9.8% to $5.47B, net income rising 6.0% to $1.02B, and operating cash flow surging 13.2% to $1.18B, while aggressively returning capital to shareholders via $1.08B in share buybacks.
Revenue
$5.47B
++9.76% YoY
EPS (Basic)
$7.04
++10.69% YoY
Gross Margin
57.7%
-0.18% YoY
Operating Income
$1.26B
++7.11% YoY
Filed · Source: SEC EDGAR 10-K filing
Total revenue increased 9.8% year-over-year from $4.99B to $5.47B, reflecting continued consumer demand across Deckers' brand portfolio. This growth was achieved despite a mature market environment, underscoring the strength of key brands such as UGG and HOKA.
Source: Source: 10-K Income Statement (XBRL Financial Data)
Gross margin edged down modestly by approximately 18 basis points to 57.70% from 57.88% in the prior year, as cost of revenue grew slightly faster (10.2%) than revenue (9.8%). Despite this minor compression, the gross margin remains exceptionally high for a footwear and apparel company.
Source: Source: 10-K Income Statement & Key Ratios (XBRL Financial Data)
SG&A expenses grew 11.0% to $1.89B and R&D expenses surged 21.6% to $68.9M, both outpacing revenue growth of 9.8%. This drove operating margin compression of approximately 57 basis points to 23.08%, suggesting the company is investing heavily in brand building and product development.
Source: Source: 10-K Income Statement (XBRL Financial Data)
2 more insights available
Upgrade to unlockSG&A and R&D expenses are growing faster than revenue, with SG&A up 11.0% and R&D up 21.6% versus revenue growth of 9.8%. If revenue growth decelerates, the company may face meaningful margin pressure given its elevated fixed cost base. Operating margin has already compressed by ~57 basis points year-over-year to 23.08%.
Source: Source: 10-K Income Statement (XBRL Financial Data)
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $0.96 versus the $0.85 analyst consensus — a +13.4% beat for FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $5.47B | $4.99B | +9.76% |
Cost of Revenue | $2.31B | $2.1B | +10.22% |
Gross Profit | $3.16B | $2.89B | +9.43% |
Operating Income | $1.26B | $1.18B | +7.11% |
Net Income | $1.02B | $966.09M | +6.00% |
EPS (Basic) | $7.04 | $6.36 | +10.69% |
EPS (Diluted) | $7.02 | $6.33 | +10.90% |
R&D Expense | $68.9M | $56.68M | +21.57% |
SG&A Expense | $1.89B | $1.71B | +11.03% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $3.69B | $3.57B | +3.29% |
Current Assets | $2.85B | $2.86B | -0.35% |
Current Liabilities | $804.07M | $769.94M | +4.43% |
Stockholders' Equity | $2.5B | $2.51B | -0.53% |
Cash & Equivalents | $1.91B | $1.89B | +0.96% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $1.18B | $1.04B | +13.16% |
Investing Cash Flow | $-84.61M | $-75M | -12.81% |
Financing Cash Flow | $-1.08B | $-581.33M | -86.48% |
Share Buybacks | $1.08B | $567M | +89.61% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 57.7% | 57.9% | -0.18% |
Operating Margin | 23.1% | 23.6% | -0.57% |
Net Margin | 18.7% | — | — |
ROE | 41.0% | — | — |
ROA | 27.8% | — | — |
Current Ratio | $3.545 | — | — |
Deckers had a strong fiscal year 2026, with revenue growing 9.8% to $5.47B and net income rising 6.0% to $1.02B. Diluted EPS grew even faster at 10.9% to $7.02, boosted by an aggressive $1.08B share buyback program.
The key takeaways are robust top-line growth, best-in-class gross margins of 57.70%, and exceptional cash generation with operating cash flow of $1.18B. However, operating margin compressed slightly to 23.08% as SG&A and R&D expenses grew faster than revenue.
Deckers spent $1.08B on share repurchases in FY2026, nearly doubling the $567M spent in FY2025. This aggressive buyback activity was a major driver of EPS growth outpacing net income growth.
Key risks include rising SG&A and R&D costs outpacing revenue growth, brand concentration risk around UGG and HOKA, and the sustainability of its premium gross margins amid input cost pressures. The elevated pace of share buybacks also raises questions about long-term financial flexibility.
Deckers' financial health is very strong, with $1.91B in cash, a current ratio of 3.54, ROE of 41.0%, and ROA of 27.8%. The company generates substantial free cash flow of approximately $1.10B and carries a conservatively leveraged balance sheet.