Hoka continued its blistering sales for parent Deckers Brands, helping the company deliver record results as the brand added more than half a billion dollars of top-line revenue for fiscal year 2023.

Hoka’s net sales increased 58.5% to $1.4 billion, the fourth year in a row the brand has delivered revenue growth above 50%.

According to Dave Powers, president and chief executive officer of Deckers, the growth was driven by several factors, including:

• A more than 30% increase in global brand awareness in fall 2022.
• An acceleration of direct-to-consumer, which grew 85% versus the prior year.
• Broader category adoption.
• Market share growth with existing points of wholesale distribution.
• Additional access points with strategic partners, complemented by increased availability of product inventory and an improved supply chain.

Across all channels, Hoka more than doubled revenue on trail and hike products.

Powers said the Goleta, California-based company intends to build Hoka into a multibillion-dollar major player in the performance athletic space but doesn’t want to saturate the market and damage the brand in the near-term.

“We’re in this long game, and we feel like we have a very special, very, very strong brand with a lot of runway ahead of it,” Powers said in an earnings call with investors. “In some ways, we’re in no rush. We don’t want to flood the market ahead of demand.”

Deckers expects Hoka to grow into a $2 billion brand over the next couple years.

“You think about category expansion beyond road running, into trail running, into hike, outdoor lifestyle athletics, kids, apparel, etc., this is certainly a multibillion-dollar opportunity,” Powers said.

Hoka Global Marketing

Hoka increased its marketing efforts last year with a global campaign that incorporated television, digital and outdoor advertising to reach a broader audience in the U.S., Europe and Asia. According to Powers, the initiative increased awareness of Hoka by more than 40% in some countries.

“Given the success the brand has experienced, we continue to see a significant opportunity for growth in each of our markets over the long term,” he said. “Specifically, we are working to close the awareness gap between the U.S. and international regions to build a more global brand.”

Hoka DTC Growth

Hoka is planning to grow the DTC channel, driving full price sell-through and building market share, according to the company.

Powers said the company is “very pleased” with how the Hoka stores are performing.

Hoka’s growth drove DTC to 34% of total brand revenue, compared to 29% last year.

Hoka continues to bring new consumers into the brand, while also retaining existing consumers. The brand reported a 78% increase in acquisition and an 81% increase in retention compared to last year.

Hoka is also reaching a younger demographic, more than doubling the number of customers aged 18-34.

“As Hoka continues to expand, we are encouraged by the broader product adoption from consumers beyond the brand’s heritage running styles,” Powers said. “We have seen this trend among DTC consumers and continue to gain category shelf space with wholesalers.”

Among DTC customers in the U.S. and EMEA, multi-category purchases increased 79% and 127% last year, respectively.

Deckers has been trying pop-ups in the U.S. to test markets, according to Powers. Hoka will be opening its first store in New York City in a few weeks. It plans to take a similar approach internationally as well.

“We do think retail for Hoka in North America, Europe, and particularly China as a place to experience the brand head to toe and get to know the brand better is important in key markets,” Powers said.

Hoka Wholesale

Wholesale revenue increased 47% versus the prior year, driven by market share gains with existing points of distribution.

“Hoka is leveraging the run and outdoor specialty channel to maintain authenticity and brand credibility by offering exclusive high-performance products that are only available at DTC and select specialty doors,” Powers said.

Powers declined to share how much business the retail specialty channel makes up for Hoka, but he said it’s roughly 1,100 doors in North America.

“It’s meaningful, and strategically, it’s very, very important,” he said. “We are continuing to take share. We are not No. 1 yet. And so long as we are not No. 1, there is opportunity to take share and we are doing that.”

Hoka Q4 2023 Results

For the quarter ended March 31, Hoka’s net sales increased 40.3% to $397.7 million.

Teva Results

Global revenue for fiscal year 2023 increased 12% versus last year to a record $183 million, the second consecutive year of double-digit growth for the sports sandal brand.

Teva recaptured revenue lost in the previous year due to supply chain issues.

“We are confident about the opportunity ahead for Teva as the brand works toward future growth through additional investments this fiscal year aimed at driving increased closet share over the next five years,” Powers said.

In the fourth quarter, Teva’s net sales increased 14.6% to $62.8 million.

Deckers Brands Q4 Results

For the fourth quarter, revenue came in at $792 million, representing an increase of 8% versus the prior year. Net sales increased 10.2% on a constant currency basis.

Gross margin in the fourth quarter was 50%, a 130-basis point increase from the prior year period.

Net income for the quarter was $91.7 million, a 33.3% increase.

Deckers Brands Full Year Results

Deckers’ revenue increased 15% on a reported basis versus last year to a record $3.63 billion, up from $3.15 billion in the prior year.

Net sales increased 18.4% on a constant currency basis.

Gross margin for the year was 50.3%, down 70 basis points versus last year.

Net income for the year was $516.8 million, a 14.3% increase.

FY24 Outlook

Deckers expects top line revenue of approximately $3.95 billion in 2024, which equates to an increase of approximately 9%, with Hoka again the main growth driver.

Gross margin is expected to be approximately 52% of sales.

The company expects Hoka revenue to increase in the 20% range versus the prior year as it prioritizes marketplace management.

The majority of Hoka’s growth is expected to happen in the brand’s DTC channel and at wholesale, assuming no net new doors are added globally.

Bart Schaneman can be reached at [email protected].

Editor’s note: To read about results for Ugg and Sanuk, also owned by Deckers Brands, see the story in our sister publication, Shop Eat Surf.