Deckers Outdoor Corporation

for our products anticipated impacts from our brand product marketing marketplace and distribution strategies product development plans and the timing of product launches changes in consumer behavior including in response to price increases our ability to acquire new consumers and gain share in the dynamic consumer environment our ability to achieve our financial outlook including anticipated revenues product mix margin expenses inventory levels, promotional activity, anticipated rate of full price selling, and earnings per share, and our capital allocation strategy, including the potential repurchase of shares. Forward-looking statements made on this call represent management's current expectations and are based on information available at the time such statements are made. Forward-looking statements involve numerous known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from any results predicted, assumed, or implied. by the forward-looking statements. The company has explained some of these risks and uncertainties in its SEC filings, including in the risk factor section of its annual report on Form 10-K and quarterly reports on Form 10-Q. Except as required by law or the listing rules of the New York Stock Exchange, the company expressly disclaims any intent or obligation to update any forward-looking statements. On this call, management may refer to financial measures that were not prepared in accordance with generally accepted accounting principles in the United States. including constant currency. For example, the company reports comparable direct-to-consumer sales on a constant currency basis for operations that were open through the current and prior reporting periods. The company believes that these non-GAAP financial measures are important indicators of its operating performance because they exclude items that are unrelated to and may not be indicative of its core operating results. Please review our earnings release published today for additional information regarding our non-GAAP financial measures. With that, I'll now turn it over to Stefano.

Thanks, Erin. Good afternoon, everyone, and thank you for joining today's call. Decker has delivered an outstanding third quarter performance, underscored by a strong composition of results that demonstrate robust global demand for our brands, fueling an increased outlook for fiscal year 2026. For the third quarter, we delivered $1.96 billion of revenue, representing a 7% increase versus the prior year. Global HOCA and UGG performance was exceptional, with revenue increasing by 18% and 5% versus last year respectively, and each brand delivering balanced growth across DTC and wholesale. From a regional perspective, HOCA and UGG collectively drove third quarter revenue increases of 15% in international markets, reflecting continued momentum from the first half, and 5% in the United States, demonstrating positive inflection relative to the first half based on our effective marketplace management initiatives. This result exceeded our expectations for both brands. Importantly, it was achieved while maintaining high levels of full price selling and demonstrated resilient price elasticity. As a result, DECA's preserved strong gross margins which contributed to an 11% increase in our third quarter diluted earnings per share, a record $3.33. As I reflect on our progress this year and our focus to build brands for long-term sustainable growth, I'm extremely pleased with our performance over the first nine months of this fiscal year, which contributed to total company revenue increasing 10%, whole car revenue growing 16%, ag revenue growing 8%, and diluted earnings per share, increasing 13%. Decker's year-to-date fiscal results and raised outlook demonstrate our commitment to generate shareholder value through sustained growth in revenue and earnings per share, bolstered by our share repurchase program and fortified balance sheet. Now, in the final quarter of this fiscal year and looking into the next, I'm confident they will continue to execute on our strategic plan and deliver compelling results through the sustained strong momentum of our global brands. Steve will provide specific details on our updated guidance and third quarter performance later in the call. But first, I'll share some brand specific highlights from the third quarter. Starting with ag, global ag revenue in the third quarter increased 5% versus last year to a record $1.3 billion. Hype continues to be top of mind for consumers, growing its leadership position as a premium lifestyle brand through a combination of purposeful, consumer-informed product creation that celebrates recognizable brand codes, broadening the dimensions of category acceptance, and an elevated global marketplace aligned to our target consumer segments, where the brand is able to build connections and community through a tailored yet consistent brand identity. As discussed on our last call, in response to the ongoing rise in consumer demand for the YAG brand, we strategically allocated additional products to the wholesale channel prior to peak season. The results indicate that this approach has proven effective. Our strategic execution enabled improved in-stock positions for wholesale partners, boosting fall sales, and as planned, we effectively address late season demand through our direct-to-consumer channels. In terms of the ad brand's third quarter performance across channels, DTC revenue increased 5% versus last year, and wholesale revenue grew 4% compared to last year. From a direct-to-consumer perspective, our marketplace teams around the globe work closely across different departments to fill consumer demand both in retail locations and online. Through these efforts, we drove meaningful growth in ad reward membership, email subscribers, and retained consumers, providing ample opportunity to further strengthen consumer connections and drive repeat purchases in the future. During the quarter, we also use our DTC channel to test products with speed to market, strategically pulling forward targeted new silhouettes to generate early reads at a time where UGG historically has the greatest attention from consumers. Our new Quill franchise, was a standout success through this initiative. By sharing performance insights with our wholesale partners for products like the Quill, we were able to accelerate the global expansion and adoption of new offerings. UGG has firmly positioned itself as the top premium lifestyle brand in the global market. Our ongoing goal is to further enhance UGG's presence at every consumer touchpoint through consistent product presentation that highlights our distinctive brand identity. While we focus on improving the consumer experience in our direct-to-consumer channels, we're also collaborating very closely with our retail partners to elevate the brand through intentional product offerings that support year-round wearability in our men's initiatives. By planning strategically for shared growth, we sustain strong partnerships and nurture future opportunities, all while ensuring marketplace scarcity for UGG remains healthy. We're especially proud of how our retail partners supported the ag brand during the holiday season, strengthening consumer connections and raising awareness and adoption across categories. Overall, this was an exceptionally well executed third quarter and holiday season for the ag brand. Our marketing teams did a brilliant job leveraging product collaborations, brand activations, and ambassadors to drive ag brand heat, including a fuel house experience in New York City, celebrating the ag Sakai product collaboration, pop-ups in Chicago and Berlin that featured Viagg Palace product collaboration, and new male brand ambassadors across sport and pop culture in China, contributing to our strongest men's regional performance. Globally, the men's category performed very well as you continue to see healthy adoption of popular all-gender products like the Tasman, Ultramini, and Lomel, as well as men's specific styles like the Weather Hybrid Collection that spans across multiple silhouettes. Overall product performance, was positively influenced by robust consumer response to newness, which underscores the growing demand for UGG and its diversified product range across various categories. Iconic UGG franchises continue to benefit from the addition of complimentary styles, such as the new Tazel and Classic Micro, helping fuel growth for the brand, with the latter even placing among the 10 best-selling styles this quarter. We also made notable progress with products aimed at supporting the brand's 365 initiative. The Lomo franchise continues to expand UGG's presence in the lifestyle sneaker segment, more than doubling its revenue this quarter and ranking among the brand's top five best sellers. As we approach the fourth quarter, our priority is to finish another successful year by boosting interest in new product launches that align with our brand strategies, including the Minimel, an all-new low-profile spring sneaker with the Lomel collection, the Otso, an all-new clog with a sleeker aesthetic that features elevated materials, and new fashion sandal silhouettes within the Golden collection. Congratulations to Anne and the entire UGG team on a fantastic fall season and holiday quarter. We are excited for what's to come as we continue to expand consumer reach and category acceptance of our compelling product assortment and grow this amazing brand around the world. Speaking of amazing brands, let's shift to Hoka. Global Hoka revenue in the third quarter increased 18% versus last year to $629 million. This growth included strength in both DTC and wholesale, with gains in the US as well as international markets. The strong performance was driven by broader consumer adoption of the Hoka brand's innovative and versatile products, especially as we've refined our approach to managing the global marketplace. This helped achieve balanced growth across channels, as DTC revenue increased 19% versus last year, and wholesale revenue grew 18% compared to last year. As we continue to build this brand and introduce new products to the market, we are proactively maintaining a healthy pull model of demand across all channels. This approach aligns with our long-term objectives of achieving growth in every channel and region. While some fluctuations in channel growth may occur as we make strategic adjustments to distribution, we remain committed to creating a more balanced business over time as demonstrated by HOKA's performance this quarter. We continue to incorporate insights from consumers and learnings from the marketplace to refine how we go to market. A notable initiative this quarter has been our HOKA membership program, which enhanced consumer loyalty by delivering a distinct and differentiated customer experience. Our revamped membership program now includes exclusive and early product access, select opportunities for special discounts, and rewards for higher purchase frequency. Though we are still early in the development of the HOCA membership program, with additional consumer engagement drivers and differentiation in the pipeline for next year, we're already seeing a benefit in revenue per consumer, units per transaction, and multi-category purchasing from HOCA members relative to the average consumer. These members' key performance indicators are directly contributing to our positive results, helping drive an acceleration of the Hoka brand's DTC growth in the third quarter compared to the first half of the fiscal year. In the US, DTC returned to healthy growth in the quarter with a meaningful improvement of new consumer acquisition online compared to what Hoka experienced earlier this year. In addition, as we look ahead to future product transitions, we see an opportunity to more effectively utilize our higher margin DTC channel to strategically manage end of season inventory in a controlled manner, as we tightly manage wholesale marketplace inventories to ensure a clean environment for future launches. The HOKA brand's improved DTC performance demonstrates the effectiveness of our loyalty marketing tactics, which have enabled us to enhance the consumer's journey, increase brand affinity, build lasting relationships, and increase customer lifetime value for a growing base of consumers. At the same time, we remain focused on driving strong performance with Hoka in the wholesale channel. We believe it's very important for Hoka to compete in a multi-brand environment, particularly in the performance category where innovation is critical to success. Our partners remain an important destination for consumers to experience the Hoka brand's unique blend of technology, geometry, and premium materials directly on their feet. Hoka has continued to perform very well in the wholesale channel globally, driving healthy levels of full-price sell-through and gaining additional market share. In the U.S., according to Cercana, Hoka's market share increased significantly in the road-running category above $140 for the three months ending in December. This growth further establishes Hoka as the top brand in the segment and demonstrates the strength of our full-price sell-through. In Europe, the pace of sellout continues to drive record levels of reorders, with our top strategic customers averaging 90% sell-through, which is fueling future season demand. We attribute the Hoka brand's market share expansion to three main factors. Compelling innovative products that resonate with consumers. enhance global brand awareness and recognition, and increase brand access in more locations. These developments have opened the door for a wider range of consumers to connect with the brand, not just for performance related reasons. With more people choosing to wear Hoka as part of their active lifestyle wardrobe, the brand is well positioned to take advantage of this growing trend. HOKA is proactively advancing its lifestyle strategy, identifying the segment as a significant opportunity in terms of product development and expansion through wholesale distribution, account segmentation, and differentiation. As the lifestyle category evolve, HOKA is positioned to leverage the company's global expertise in this area. As HOKA continues to tap into significant lifestyle opportunities, it's important to acknowledge the valuable growth potential within our established categories. Our main global marketplace priorities for HOKA include enhancing the brand's premium position through product innovation, engaging authentically with consumers through strategic product segmentation, and expanding the brand's reach while maintaining performance integrity. As we look at wholesale distribution in the U.S. market, run specialty remains our priority segment to introduce and engage consumers with HOKA brand's innovative performance products. Our aim here is to uphold Hawkeye's performance credibility by continuing to lead in this segment. In sporting goods, Hawkeye is present in roughly half of the targeted stores we consider potential distribution points. We also see more opportunities to expand shelf space and market share in existing doors as we continue to diversify our product offering. The biggest opportunity for HOKA's expansion in the U.S. lies within the athletic specialty segment, where we're currently represented in only about a quarter of the stores we believe will be relevant for the brand moving forward. Internationally, we're much earlier in the process of expanding HOKA's distribution. In Europe, we're making steady progress in building awareness and marketplace presence. We still have room for door and market share expansion in the European run specialty segment, where we continue to climb in brand ranking throughout various countries in the region. having captured around 80% of the opportunity we see for the segment. Furthermore, HOK has reached approximately 40% of the European sporting goods destinations considered relevant for the brand. It is available in less than 20% of suitable athletic specialty stores in the region. This illustrates the significant opportunity that remains for attractive distribution expansion. In Asia, our primary area of focus remains China, where we operate mainly through a mix of company-owned and partner-run monobrand retail stores. Typically, we keep a 2 to 1 ratio of wholesale partner locations to company-owned retail stores. Currently, we occupy a little less than one-third of the potential we see over the next several years. All of this to say, we continue to see meaningful, untapped global opportunities for HOKA. We're building this brand for the long term, and we'll continue to take a methodical approach to global expansion, maintaining a full model of demand while gradually improving the balance between DTC and wholesale channels. Our ongoing progress in international markets along with positive developments in our U.S. operations, makes us very optimistic about Hoka's promising future. From a product perspective, top franchises continue to perform very well, and we are now operating in a much cleaner global marketplace relative to a year ago. The brand's launch of Gaviota 6 is off to a great start, further bolstering our position in the stability category alongside the positive reception of the Arahi 8. Hook has a number of exciting product updates to come in the fourth quarter across our key strategic priorities of winning in road, dominating trail, and igniting lifestyle. Their category has two key product stories launching in Q4. Our pinnacle racing shoe, the Cielo X1 3.0, which is the fastest and lightest racing shoe Hook has ever created, and our completely redesigned Mach 7, crafted for responsive daily runs with tempo. Beyond the road segment, we eagerly anticipate the launch of Speed Goat 7, which is designed to build Hoka's legacy in the trail category by offering an exceptional underfoot experience across diverse terrains. In lifestyle, we're excited to announce the launch of our first fully integrated marketing campaign for this category, featuring new ambassador partnerships, global brand experiences, and products that connect with well-known Hoka franchises. Congratulations to the whole Hoka team on a well-executed quarter. We look forward to closing out the year with these exciting product launches to come. I am really proud of the success our entire team has delivered this year, and I'm even more excited for what lies ahead as I look at the opportunities for the next year and beyond. We intend to continue driving healthy, profitable growth for both Agen Hoka. We expect Hoka to remain our fast-growing brand with significant potential for international expansion and consistent progress in the U.S., supported by effective marketplace management. At the same time, we also expect the ag brand to continue driving growth across DTC and wholesale through its MENZ and 365 product initiatives, similarly led by international regions alongside continued growth in the U.S. Given these growth opportunities, our disciplined management of the global marketplace to sustain strong full-price sales, and our strategic investments leveraging portfolio synergies, I'm confident that Decker's will continue to be a leader in our space. Thanks, everyone. Over to Steve for more details on our third quarter financial results and an update to our fiscal year 26 guidance.

Thanks, Stefano, and good afternoon, everyone. Our third quarter performance exceeded expectations and demonstrated robust momentum of the UGG and HOGA brands. For the third quarter, UGG drove solid growth to deliver its largest quarter in history, with balanced increases across channels and regions. HOCA delivered another quarter of strong global growth, with this quarter being balanced across DTC and wholesale. HOCA growth was led by international and included meaningful contributions from the U.S. market, highlighted by the positive inflection of the U.S. DTC business. These results are a testament to the exceptional strength of our premium brands within the U.S. and internationally as our disciplined approach to marketplace management combined with innovative product and an elevated consumer experience led to high levels of full-price selling and exceptional performance during the holiday season. Now, let's get into the details of the third quarter results. Third quarter fiscal 2026 revenue was $1.96 billion. representing a 7% increase as compared to the prior year. Revenue growth in the quarter was primarily driven by HOCA, which increased 18% versus last year to deliver $629 million, adding $98 million of incremental revenue over the prior year. As anticipated, HOCA performance benefited from another sequential improvement in the U.S. DTC business, which delivered healthy growth in the quarter, contributing to a more balanced result across DTC and wholesale. UGG increased 5% versus last year to deliver record quarterly revenue of $1.3 billion, adding $61 million of incremental revenue over the prior year. UGG growth also benefited from improved global DTC performance, which inflected to positive growth following a more pressured first half. Gross margin for the third quarter was 59.8%. which was better than we had expected for the quarter, primarily due to a lower than expected impact from increased tariffs, reflecting the timing of inventory flows and the mix of inventory sold through during the quarter, benefiting from lower tariffed inventory in the pipeline. Larger benefits from our pricing actions, primarily attributable to the UGG brand, and though above last year, we had slightly lower promotions than planned for the quarter. In achieving this result, both UGG and HOCA maintained a very healthy level of full-price selling, with each achieving an average selling price slightly above the prior year, and HOCA delivering gross margin expansion in the quarter, contributing to our better-than-expected results. SG&A dollar spend in the third quarter was $557 million, up 4% versus last year's $535 million, as we continue investing in key areas of the business. As a percentage of revenue, SG&A was 28.5%, which is 80 basis points below last year's rate of 29.3%, with leverage primarily driven by favorable impacts from foreign currency exchange rate remeasurement. Our tax rate for the quarter was 23.3%, which compares to 21.8% for the prior year. These results culminated in a record diluted earnings per share of $3.33 for the quarter, which is 33 cents above last year's $3 diluted earnings per share, representing EPS growth of 11%. Turning to our balance sheet, at December 31st, 2025, we ended December with $2.1 billion of cash and equivalents. Inventory was $633 million, up 10% versus the same point in time last year, and includes tariffs paid on inventory received this year. And during the period, we had no outstanding borrowings. In the third quarter, we repurchased approximately $349 million worth of shares, at an average price of $92.36. Through the first nine months of fiscal year 2026, we have repurchased approximately 8 million shares, representing more than 5% of shares outstanding at the beginning of this fiscal year. As of December 31st, 2025, the company had approximately $1.8 billion remaining authorized for share repurchases. And given our strong cash flow and cash balance, And in consideration of the current market valuation, we remain committed to continue returning value to shareholders through our share repurchase program. In fiscal year 2026, we are on track to repurchase more than $1 billion in total by the end of the year, which is expected to contribute more than 20 cents of diluted earnings per share improvement. Now, moving into our updated guidance for fiscal year 2026. Based on the strength of our brand's performance in the third quarter, we are increasing our full-year revenue expectations to a range of $5.4 billion to $5.425 billion. For HOCA specifically, we've raised our expectation, now reflecting mid-teens revenue growth versus last year. And for UGG, we now expect revenue to increase mid-single digits versus last year, which is at the high end of our prior guidance. Gross margin is now expected to be approximately 57%, which is 100 basis points above our prior guidance, primarily due to lower than previously anticipated net impact from tariffs. We still expect SG&A to be approximately 34.5% of revenue as we continue to make investments that support the long-term growth and opportunities ahead for UGG and HOCA. Our operating margin is now expected to be approximately 22.5%, which is 100 basis points above our prior guidance and remains best in class. We still expect an effective tax rate of approximately 23%. These updates and the continued benefits from both year-to-date and projected fourth quarter share repurchase result in a raise to our expected diluted earnings per share, which is now in the range of $6.80 to $6.85, representing a 7% to 8% increase over last year's record EPS. Regarding tariffs, based on the robust pricing power of our brands, which has not materially impacted demand to date, combined with a lower than expected blended tariff rate in Q3, we now expect the unmitigated tariff impact on fiscal year 2026 to be approximately $110 million. As a result of our better-than-expected price action benefits and the favorable timing of inventory sold, we now estimate a net tariff impact of approximately $25 million. Please note this does not represent a full-year impact if tariffs remain in place moving forward. Our increased full-year 2026 guidance includes the following assumptions for the fourth quarter. HOCA is expected to deliver 13% to 14% growth, representing the brand's largest-ever quarterly revenue based on the momentum from international regions and continued U.S. growth, with both contributing to global market share gains. OG revenue is assumed to be roughly flat to last year, as some orders previously planned for Q4 shipped earlier in Q3, with the total of both quarters contributing to the brand's increased outlook for the year. Our implied gross margin assumes an approximate 200 basis point headwind, the entirety of which is expected to come from the net pressure from tariffs. Note that this is projected to be our largest quarterly net impact from tariffs in fiscal year 2026 on a rate basis as we anticipate the full 20% burden in Q4. and slightly more deleverage in our SG&A spend in the quarter as we continue to make investments while taking advantage of our overall improved outlook. We believe these targeted variable investments will help us continue to carry momentum into FY27. As Stefano touched on, we have a high degree of confidence in our brands to continue delivering exceptional results into next fiscal year. Specifically, we believe DECRIS has the ability to continue delivering meaningful revenue growth paired with a top-tier operating margin beyond this year through operating a pull model of demand, maintaining a well-managed global marketplace that drives high levels of full-price selling, utilizing shared service synergies across brands as we invest to add capabilities, and remaining disciplined in our approach to portfolio management. focusing on investments in areas that we see the highest long-term returns. In closing, we are proud of the outstanding results achieved in the third quarter as our in-demand brands drove record quarterly revenue and earnings per share. UGG and HOCA are operating at a high level across the global marketplace, and I, along with the rest of our leadership team, remain confident in our ability to deliver on our increased guidance for fiscal year 2026 and continue driving healthy growth over the long term. With that, I'll hand the call back to Stefano for his final remarks.