Deckers Outdoor Corporation (NYSE:DECK) Q2 2024 Earnings Call Transcript

Dave Powers: Yes, good question. So, HOKA Performance, new doors that we have opened up are performing very, very well. I was talking to Stefano, who’s overseeing that brand, right now the new doors that we’ve opened over the last year, new accounts, all performing very well. High level of full-price sales, strong turns, scaling market share, run specialty stores where we have a number one position there that we’re fighting every day to maintain and we want to build out in that position. But new doors and Foot Locker and DICK’s and JD, et cetera. They want more. So that’s a good sign. And the way that we’re performing those doors is right in line with what we would have hoped would happen. But we’re managing it tightly as we have been doing so that we maintain full-price selling at healthy turns and gross margins for our partners.

It’s a good question on the type of consumer, Foot Locker, as an example was a strategic play, not just from a volume play, but also strategic to reach a younger lifestyle consumer, both male and female. And we’re seeing that happen. I think some of the success in Q2 was probably back-to-school business that we hadn’t really realized before. And with our focus on 18 to 34-year old consumers and college athletes, we’re seeing that pay off. And so it’s exciting to see high school athletes and college athletes and beyond gravitating to our brand, going to those doors, looking for the brand, making the choice of HOKA over a traditional Nike Dunk or Air Force 1. That’s super exciting. We’re going to keep a close eye on that because we don’t want that to be a big spike and then go away.

So we need to manage that tightly and the lifestyle teams are all over that and working with our accounts to make sure that it’s a healthy business for the long-term. And then on UGG International, similar to what Steve was saying in HOKA, UGG is an international, particularly in Europe, is at the point where UGG was a couple of years ago, really healthy, strong growth. They’ve been working hard on local marketing activations and leveraging PR in the region. And the new product is resonating extremely well across the board, but particularly with younger consumers there. And it’s really exciting to see. And we haven’t been in this position in Europe quite some time, but the momentum is real. The brand heat is improving. The level of acquisition and consideration for our consumers are all heading in the right direction.

So we think this is an opportunity to build on this, particularly in the U.K. and Germany, our two biggest markets and we’re going to continue to play this playbook out and get more aggressive with marketing activations in the region.

Janine Stichter: Great, thanks so much and best of luck.

Dave Powers: Thank you.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.