10-K – 2026-05-22 – deck-20260331.htm

Table of Contents                                                                                                                                                     F-34

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

Lo n g-Term Incentive Plan Awards . LTIP PSU awards have a multi-fiscal year performance period, generally three
years ( Measurement Period ), with performance metrics established at the beginning of the period. The grant date
fair value of LTIP PSU s is determined using a Monte-Carlo simulation model, which estimates a range of possible
future stock prices for the Company and each member of a peer group over the Measurement Period . For each
grant, the model incorporates key assumptions, including the Company’s common stock price at the grant date,
risk-free interest rate, expected dividend yield, stock price volatility, and correlation coefficients. The model also
incorporates a market condition based on the Company’s relative TSR compared to a peer group of companies
( peer market condition ), which is reflected in the grant date fair value and not subsequently adjusted.
In addition to the peer market condition reflected in grant date fair value, LTIP PSU awards include financial
performance conditions and service requirements that affect the recognition of compensation expense and the
ultimate vesting of the awards. Financial performance conditions are tied to specified revenue and pre-tax income
targets ( financial performance conditions ). The Company evaluates the probability of achieving the financial
performance conditions based on its most recent long-range forecast at least quarterly and may adjust stock-based
compensation expense to reflect updated expectations.
Following a determination of achievement of the financial performance conditions for the applicable Measurement
Period , vesting of each LTIP PSU award is subject to adjustment for the peer market condition through the
application of the TSR modifier. The number of LTIP PSU s that ultimately vest may increase up to a maximum of
200 % of the target award, based on achievement of the financial performance conditions and the TSR modifier.
LTIP PSU awards are subject to time-based service requirements and will not vest if minimum threshold financial
performance conditions are not met. Fo r LTIP PSU s granted during the fiscal years 2026 , 2025 , and 2024 , the
Company expects to exceed the minimum threshold target performance criteria based on its long-range forecast as
of March 31, 2026 .
Grants to Directors. Each of the Company’s nonemployee directors was entitled to receive common stock with a
total value of $ 170 for annual service on the Board of Directors ( Board ) during the year ended March 31, 2026 . The
shares are issued in equal quarterly installments with the number of shares being determined using the rolling
average of the closing price of the Company’s common stock during the last ten trading days leading up to, and
including, the grant date, which is in alignment with the Company’s equity grant guidelines. Each of these shares is
fully vested and recorded as compensation expense in the consolidated statements of comprehensive income on
the date of issuance.
Employee Stock Purchase Plans . In September 2024, the Company’s stockholders approved the 2024 Employee
Stock Purchase Plan ( 2024 ESPP ). The 2024 ESPP reserves 6,000,000 shares of the Company’s common stock
for sale to eligible employees using after-tax payroll deductions, which are refundable until purchases are made,
and are liability-classified. Each offering period under the 2024 ESPP is anticipated to run for approximately six
months with purchases occurring on the last day of each offering period (no look-back provision) at a 15 % discount
on the closing price on that date. The first offering period commenced on March 1, 2025. As of March 31, 2026 ,
5,955,235 shares of common stock remained available for future issuance under the 2024 ESPP , subject to
adjustment for future stock splits, stock dividends, and similar changes in capitalization.
Stock-Based Compensation. Components of stock-based compensation recorded, net of estimated forfeitures, in
SG&A expenses in the consolidated statements of comprehensive income were as follows:

Years Ended March 31,

2026

2025

2024

Stock-based compensation

RSUs

$ 23,876

$ 19,758

$ 15,935

LTIP PSUs

18,463

15,676

18,941

Grants to Directors

1,704

1,858

1,907

Subtotal

44,043

37,292

36,783

Table of Contents                                                                                                                                                     F-35

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

Years Ended March 31,

2026

2025

2024

Other stock-based compensation

Employee Stock Purchase Plan

792

651

505

Total stock-based compensation, pre-tax

44,835

37,943

37,288

Income tax benefit

( 10,741 )

( 9,304 )

( 9,097 )

Total stock-based compensation, net of tax

$ 34,094

$ 28,639

$ 28,191

Unrecognized Stock-Based Compensation. Total remaining unrecognized stock-based compensation as of
March 31, 2026 , related to non-vested awards that the Company considers probable to vest and the weighted-
average period over which the cost is expected to be recognized in future periods, is as follows:

Unrecognized
Stock-Based
Compensation

Weighted-
Average
Remaining
Vesting Period
(Years)

RSUs

$ 28,554

1.2

LTIP PSUs

23,149

1.7

Total

$ 51,703

Note 10. Derivative Instruments

The Company has the following derivative contracts recorded at fair value in the consolidated balance sheets :

March 31, 2026

Designated
Derivative
Contracts

Non-Designated
Derivative
Contracts

Total

Notional value

$ 337,183

$ 18,343

$ 355,526

Fair value recorded in other current assets

7,316

370

7,686

March 31, 2025

Designated
Derivative
Contracts

Non-Designated
Derivative
Contracts

Total

Notional value

$ 367,695

$ 14,018

$ 381,713

Fair value recorded in other current assets

2,163

75

2,238

Fair value recorded in other accrued expenses

( 64 )

—

( 64 )

The maximum amount of loss the Company would incur if derivative counterparties failed completely to perform
according to the terms of the contracts is limited to the derivative gross fair value of contracts in asset positions. The
non-performance risk of the Company and its counterparties did not have a material impact on the fair value of its
derivative contracts . As of March 31, 2026 , unrealized gains on derivative contracts recorded in AOCL are expected
to be reclassified into net sales within the next twelve months . Refer to Note 11, “Stockholders’ Equity,” for further
information on the components of AOCL .

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DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

The Company settled derivative contracts with notional values as follows:

Years Ended March 31,

2026

2025

2024

Designated Derivative Contracts

$ 431,232

$ 258,040

$ 179,528

Non-Designated Derivative Contracts

160,512

18,565

—

Total

$ 591,744

$ 276,605

$ 179,528

The following table summarizes changes in unrealized (loss) gain on cash flow hedges included in in AOCL ,
including the effect of Designated Derivative Contracts and the related income tax effects of unrealized gains or
losses that are recorded in OCI in the consolidated statements of comprehensive income :

Years Ended March 31,

2026

2025

2024

Beginning balance

$ 1,584

$ —

$ —

(Loss) gain recorded in OCI

( 12,631 )

4,387

4,090

Gain (loss) reclassified into net sales

17,849

( 2,288 )

( 4,090 )

Income tax expense in OCI

( 1,238 )

( 515 )

—

Ending balance

$ 5,564

$ 1,584

$ —

Subsequent to March 31, 2026 , through May 1, 2026 , the Company entered into Designated Derivative Contracts
and Non-Designated Derivative Contracts with notional values totaling $ 71,135 and $ 14,722 , r espectively, which are
collectively expected to mature within the next twelve months .

Note 11. Stockholders’ Equity

Stock Repurchase Program . The Board has approved a stock repurchase program which authorizes the
Company to repurchase shares of its common stock in the open market or in privately negotiated transactions,
subject to market conditions, applicable legal requirements, and other factors (collectively, the stock repurchase
program ). The Board last approved an authorization of $ 2,250,000 on May 21, 2025 , to repurchase shares of the
Company’s common stock under the same conditions as the prior stock repurchase program. As of March 31, 2026 ,
the aggregate remaining approved amount under the stock repurchase program is $ 1,549,602 .
The stock repurchase program does not obligate the Company to acquire any amount of common stock and may be
suspended at any time at the Company’s discretion. The credit agreements governing the Company’s revolving
credit facilities allow it to make stock repurchases under this program, so long as it does not exceed certain
leverage ratios. As of March 31, 2026 , the Company has not exceeded the stated leverage ratios, and no defaults
have occurred under these credit agreements.
S tock repurchase activity under the Company’s stock repurchase program was as follows:

Years Ended March 31,

2026

2025

2024

Total number of shares repurchased (1)

10,496,292

3,800,040

4,289,124

Weighted average price per share

$ 102.43

$ 149.21

$ 96.74

Dollar value of shares repurchased (2) (3)

$ 1,075,100

$ 567,002

$ 414,931

(1) All share repurchases were made pursuant to the stock repurchase program in open-market transactions.
(2) May not calculate on rounded amounts.
(3) The dollar value of shares repurchased excludes the cost of broker commissions, excise taxes, and other costs.

Table of Contents                                                                                                                                                     F-37

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

Subsequent to March 31, 2026 , through May 1, 2026 , the Company repurchased 1,096,908 shares of its common
stock at a weighted average price of $ 105.75 per share for $ 115,999 . As of May 1, 2026 , the Company had
$ 1,433,603 for repurchases remaining authorized under the stock repurchase program .
On May 20, 2026 , the Board approved an additional authorization of $ 3,500,000 , for the Company to repurchase its
common stock under the same conditions as the prior stock repurchase program, resulting in an aggregate
remaining authorization of approximately $ 4,840,000 as of that date.
Accumulated Other Comprehensive Loss. The components within AOCL , net of tax, recorded in the consolidated
balance sheets , are as follows:

As of March 31,

 

2026

2025

Unrealized gain on cash flow hedges

$ 5,564

$ 1,584

Cumulative foreign currency translation loss

( 41,483 )

( 51,238 )

Total

$ ( 35,919 )

$ ( 49,654 )

Note 12. Basic and Diluted Shares

The reconciliation of basic to diluted weighted-average common shares outstanding was as follows:

 

Years Ended March 31,

 

2026

2025

2024

Basic

145,498

151,992

155,225

Dilutive effect of equity awards

307

678

1,060

Diluted

145,805

152,670

156,285

Excluded

RSUs

77

9

16

LTIP PSUs

254

155

291

Deferred Non-Employee Director Equity Awards

5

2

3

Employee Stock Purchase Plan

3

—

—

Excluded Awards. The equity awards excluded from the calculation of the dilutive effect may be excluded due to
one of the following: (1) the shares were antidilutive or (2) the necessary conditions had not been satisfied for the
shares to be deemed issuable based on the Company’s performance for the relevant performance period. The
number of shares stated for each of these excluded awards is the maximum number of shares issuable pursuant to
these awards. For those awards subject to the achievement of performance criteria, the actual number of shares to
be issued pursuant to such awards will be based on Company performance in future periods, net of forfeitures, and
may be materially lower than the number of shares presented, which could result in a lower dilutive effect. Refer to
Note 9, “Stock-Based Compensation,” for further information on the Company’s equity incentive plans .

Note 13. Reportable Operating Segments

Information reported to the Chief Operating Decision Maker ( CODM ), who is the Principal Executive Officer, is
organized into the Company’s three reportable operating segments , which include the brand operations for the
HOKA brand, UGG brand, and Other brands. The operations of each brand within these reportable operating
segment s are managed separately because each requires different marketing, research and development, design,
sourcing, and sales strategies.

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DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

Segment Net Sales, Gross Margin, and Income from Operations. The CODM regularly evaluates the
performance of each reportable operating segment based on net sales, gross profit as a percentage of net sales
( gross margin ), and income from operations when making decisions about resource allocations to each reportable
operating segment. Income from operations of each reportable operating segment includes certain costs which are
specifically related to each reportable operating segment and that are regularly provided to the CODM . These costs
consist of cost of sales; payroll and related expenses, including stock-based compensation; advertising, marketing,
and promotion expenses; rent and occupancy (including maintenance and utilities); depreciation and other related
costs; and other segment items. T here are no inter-segment sales for any period presented. The accounting policies
applicable to the Company’s reportable operating segment s are consistent with those described in Note 1 ,
“General.”
Income from operations of each reportable operating segment excludes enterprise and shared brand expenses as
well as total other income, net , which are not used to assess reportable operating segment performance .
Unallocated enterprise and shared brand expenses are costs that are managed centrally and not specific to any one
brand. These costs are primarily comprised of certain payroll and related expenses, including stock-based
compensation; global IT expenses; 3PL service fees; depreciation, rent, and occupancy for owned warehouses and
DC s and offices; and other SG&A expenses, such as costs for contract services, materials, supplies, and travel.
These costs span multiple functions including owned warehouses and DC s and 3PL service fees, along with
enterprise costs which include centralized commercial operations, IT , finance, human resources, legal, supply chain,
and corporate executives.
The Company does not regularly provide total assets or capital expenditures information by reportable operating
segment to the CODM because that information is not used to evaluate performance or allocate resources to each
reportable operating segment .
Reportable operating segment information, with a reconciliation to the consolidated statements of comprehensive
income, was as follows:

Year Ended March 31, 2026

HOKA

UGG

Other Brands (3)

Total

Net sales

$ 2,587,330

$ 2,738,758

$ 146,208

$ 5,472,296

Less: Cost of sales

1,116,395

1,115,588

82,587

2,314,570

Segment gross profit

1,470,935

1,623,170

63,621

3,157,726

Segment gross margin

56.9 %

59.3 %

43.5 %

57.7 %

Less:

Payroll and related costs

130,466

158,290

18,317

307,073

Advertising, marketing, and promotion
expenses

263,063

215,403

17,372

495,838

Rent and occupancy

46,173

84,287

111

130,571

Depreciation and other related costs (1)

7,831

12,245

108

20,184

Other segment items (2)

112,422

107,614

11,348

231,384

Segment SG&A expenses

559,955

577,839

47,256

1,185,050

Segment income from operations

$ 910,980

$ 1,045,331

$ 16,365

$ 1,972,676

Segment operating margin

35.2 %

38.2 %

11.2 %

36.0 %

Year Ended March 31, 2025

HOKA

UGG

Other Brands (3)

Total

Net sales

$ 2,233,090

$ 2,531,351

$ 221,171

$ 4,985,612

Less: Cost of sales

949,824

1,023,495

126,630

2,099,949

Segment gross profit

1,283,266

1,507,856

94,541

2,885,663

Segment gross margin

57.5 %

59.6 %

42.7 %

57.9 %

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DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

Year Ended March 31, 2025

HOKA

UGG

Other Brands (3)

Total

Less:

Payroll and related costs

101,056

146,093

18,179

265,328

Advertising, marketing, and promotion
expenses

226,238

180,889

25,071

432,198

Rent and occupancy

26,467

75,724

424

102,615

Depreciation and other related costs (1)

5,007

10,026

4,412

19,445

Other segment items (2)

75,993

92,251

11,877

180,121

Segment SG&A expenses

434,761

504,983

59,963

999,707

Segment income from operations

$ 848,505

$ 1,002,873

$ 34,578

$ 1,885,956

Segment operating margin

38.0 %

39.6 %

15.6 %

37.8 %

Year Ended March 31, 2024

HOKA

UGG

Other Brands (3)

Total

Net sales

$ 1,806,740

$ 2,239,132

$ 241,891

$ 4,287,763

Less: Cost of sales

763,673

983,636

154,966

1,902,275

Segment gross profit

1,043,067

1,255,496

86,925

2,385,488

Segment gross margin

57.7 %

56.1 %

35.9 %

55.6 %

Less:

Payroll and related costs

74,991

134,307

17,628

226,926

Advertising, marketing, and promotion
expenses

175,756

148,809

24,287

348,852

Rent and occupancy

16,589

75,724

348

92,661

Depreciation and other related costs (1)

3,389

9,295

10,034

22,718

Other segment items (2)

53,295

82,534

10,907

146,736

Segment SG&A expenses

324,020

450,669

63,204

837,893

Segment income from operations

$ 719,047

$ 804,827

$ 23,721

$ 1,547,595

Segment operating margin

39.8 %

35.9 %

9.8 %

36.1 %

(1) Depreciation and other related costs generally include depreciation of property and equipment, amortization and impairment of
intangible assets or other-long lived assets, accretion, loss on disposal of assets, and other miscellaneous costs. During the
year ended March 31, 2024, the Company recorded an impairment to intangible assets of $ 8,164 for the Sanuk brand definite-
lived trademark. Refer to the section titled “Recoverability of Definite-Lived Intangible and Other Long-Lived Assets,” in Note 1,
“General,” for further information on the impairment loss.
(2) Other segment items are comprised of other SG&A expenses, which primarily include credit card fees, sales commissions ,
materials and supplies, travel, and certain 3PL service fees, and other miscellaneous expenses.
(3) The Other brands reportable operating segment for fiscal year 2026, includes financial results for the phase out of the
Koolaburra brand and AHNU brand. The Other brands reportable operating segment for the prior period includes financial
results for the former Sanuk brand through the Sanuk Brand Sale Date. Refer to the section titled “Reportable Operating
Segments,” in Note 1, “General,” for further information.

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DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Fiscal Years Ended March 31, 2026 , 2025 , and 2024
(amounts in thousands, except per share data)

A reconciliation of reportable segment income from operations to consolidated statements of comprehensive income
was as follows:

Years Ended March 31,

2026

2025

2024

Segment income from operations

$ 1,972,676

$ 1,885,956

$ 1,547,595

Unallocated enterprise and shared brand expenses (1)

( 709,773 )

( 706,864 )

( 620,081 )

Total other income, net

63,453

64,207

51,427

Consolidated income before income taxes

$ 1,326,356

$ 1,243,299

$ 978,941

(1) To the extent that consolidated SG&A expenses exceed reportable operating segment SG&A expenses, they are recorded in
unallocated enterprise and shared brand expenses, which are costs that are managed centrally and not specific to any one
brand.

Note 14. Supplier Finance Program

The Company has a voluntar y Supplier Finance Program ( SFP ) adm inistered through a third-party platform that
provides the Company’s independent manufacturers that supply its inventory ( inventory suppliers ) the opportunity to
sell their receivables due from the Company to participating financial institutions in advance of the invoice due date,
at the sole discretion of both inventory suppliers and the financial institutions The Company is not party to the
agreements between these third parties and has no economic interest in an inventory suppliers ’ decision to sell a
receivable.
The Company’s payment obligations, including the amounts due and payment terms, which generally do not exceed
90 days, are not impacted by the inventory suppliers ’ election to participate in the SFP , and the Company provides
no guarantees to any third parties under the SFP . Accordingly, amounts due to inventory suppliers that elect to
participate in the SFP are recorded in trade accounts payable in the consolidated balance sheets .
Activity for the Company’s SFP program is as follows:

As of March 31,

 

2026

2025

Beginning balance

$ 896

$ 3,483

Obligations added

35,899

29,373

Obligations settled

( 33,593 )

( 31,960 )

Ending balance

$ 3,202

$ 896

Payments made in connection with the SFP are reported as cash used in operating activities in the trade accounts
payable line item of the consolidated statements of cash flows .

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Schedule II
DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES
TOTAL VALUATION AND QUALIFYING ACCOUNTS
(dollar amounts in thousands)

Allowances for doubtful accounts, sales discounts, and chargebacks against gross trade accounts receivable
recorded in the consolidated balance sheets and related to wholesale channel sales, are as follows:

Years Ended March 31,

2026

2025

2024

Allowance for doubtful accounts (1)

Beginning balance

$ ( 13,534 )

$ ( 9,109 )

$ ( 10,576 )

Additions

( 6,532 )

( 4,869 )

( 658 )

Deductions

146

444

2,125

Ending balance

$ ( 19,920 )

$ ( 13,534 )

$ ( 9,109 )

Allowance for sales discounts (2)

Beginning balance

$ ( 1,366 )

$ ( 3,840 )

$ ( 5,656 )

Additions

( 22,394 )

( 19,028 )

( 17,060 )

Deductions

22,114

21,502

18,876

Ending balance

$ ( 1,646 )

$ ( 1,366 )

$ ( 3,840 )

Allowance for chargebacks (3)

Beginning balance

$ ( 17,983 )

$ ( 14,382 )

$ ( 16,272 )

Additions

( 30,039 )

( 31,701 )

( 28,845 )

Deductions

31,390

28,100

30,735

Ending balance

$ ( 16,632 )

$ ( 17,983 )

$ ( 14,382 )

Total

$ ( 38,198 )

$ ( 32,883 )

$ ( 27,331 )

(1) The additions to the allowance for doubtful accounts primarily represent estimates of bad debt expense or recovery derived
from the Company’s evaluation of accounts receivable collectability. Deductions are for the actual collections of doubtful
accounts.
(2) The additions to the allowance for sales discounts primarily represent estimates of discounts to be taken by the Company’s
customers based on the amount of outstanding discounts for meeting shipment or prompt payments terms . Deductions are for
the actual discounts taken by the Company’s customers against outstanding trade accounts receivable.
(3) Th e additions to the allowance for chargebacks are primarily for price adjustments, short shipments, and other immaterial
chargeback activity taken in the respective year, as well as an estimate of amounts that will be taken in the future related to
sales in the current reporting period. Deductions are for the actual amounts written off against outstanding trade accounts
receivable.