Item 1. FINANCIAL STATEMENTS

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(dollar and share data amounts in thousands, except par value)

			December 31, 2025						March 31, 2025
ASSETS									(AUDITED)
Cash and cash equivalents			$	2,086,746					$	1,889,188
Trade accounts receivable, net of allowances ($49,395 and $32,883 as of December 31, 2025, and March 31, 2025, respectively)			344,325						332,872
Inventories			633,485						495,226
Prepaid expenses			49,699						39,294
Other current assets			160,451						67,282
Income tax receivable			7,684						36,613
Total current assets			3,282,390						2,860,475
Property and equipment, net of accumulated depreciation ($442,579 and $402,964 as of December 31, 2025, and March 31, 2025, respectively)			333,572						325,599
Operating lease assets			300,902						237,352
Goodwill			13,990						13,990
Other intangible assets, net of accumulated amortization ($26,073 and $25,014 as of December 31, 2025, and March 31, 2025, respectively)			15,652						15,699
Deferred tax assets, net			93,681						77,591
Other assets			61,963						39,546
Total assets			$	4,102,150					$	3,570,252
LIABILITIES AND STOCKHOLDERS’ EQUITY
Trade accounts payable			$	598,497					$	417,955
Accrued payroll			86,935						125,417
Operating lease liabilities (Note 5)			76,771						54,453
Other accrued expenses			236,668						142,120
Income tax payable			142,116						23,299
Value added tax payable			8,456						6,697
Total current liabilities			1,149,443						769,941
Long-term operating lease liabilities (Note 5)			266,111						222,522
Income tax liability			15,524						13,587
Other long-term liabilities			61,618						51,189
Total long-term liabilities			343,253						287,298
Commitments and contingencies (Note 5)
Stockholders’ equity
Common stock ($0.01 par value per share; 750,000 shares authorized; 142,331 and 150,201 shares issued and outstanding as of December 31, 2025, and March 31, 2025, respectively)			1,423						1,502
Additional paid-in capital			279,114						253,466
Retained earnings			2,374,985						2,307,699
Accumulated other comprehensive loss (Note 8)			(46,068)						(49,654)
Total stockholders’ equity			2,609,454						2,513,013
Total liabilities and stockholders’ equity			$	4,102,150					$	3,570,252

See accompanying notes to the condensed consolidated financial statements.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(dollar and share data amounts in thousands, except per share data)

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Net sales (Note 2 and Note 10)			$	1,957,549					$	1,827,165					$	4,352,927					$	3,963,832
Cost of sales			786,189						724,542						1,839,839						1,657,937
Gross profit			1,171,360						1,102,623						2,513,088						2,305,895
Selling, general, and administrative expenses (Note 10)			556,994						535,349						1,406,914						1,300,728
Income from operations (Note 10)			614,366						567,274						1,106,174						1,005,167
Interest income			(13,523)						(15,978)						(47,275)						(48,027)
Interest expense			1,069						610						2,525						2,792
Other income, net			(93)						(1,300)						(1,411)						(1,605)
Total other income, net			(12,547)						(16,668)						(46,161)						(46,840)
Income before income taxes			626,913						583,942						1,152,335						1,052,007
Income tax expense (Note 4)			145,768						127,208						263,835						237,327
Net income			481,145						456,734						888,500						814,680
Other comprehensive income (loss), net of tax
Unrealized gain (loss) on cash flow hedges			4,517						6,021						(5,564)						2,555
Foreign currency translation (loss) gain			(1,474)						(17,707)						9,150						(7,266)
Total other comprehensive income (loss), net of tax			3,043						(11,686)						3,586						(4,711)
Comprehensive income			$	484,188					$	445,048					$	892,086					$	809,969
Net income per share
Basic			$	3.34					$	3.01					$	6.05					$	5.35
Diluted			$	3.33					$	3.00					$	6.04					$	5.33
Weighted-average common shares outstanding (Note 9)
Basic			144,076						151,820						146,929						152,307
Diluted			144,289						152,386						147,202						152,924

See accompanying notes to the condensed consolidated financial statements.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(amounts in thousands)

			Nine Months Ended December 31, 2025
			Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Total Stockholders’ Equity
			Shares						Amount
Balance, March 31, 2025			150,201						$	1,502					$	253,466					$	2,307,699					$	(49,654)					$	2,513,013
Stock-based compensation			3						—						8,553						—						—						8,553
Shares issued upon vesting			4						—						—						—						—						—
Shares withheld for taxes			—						—						(237)						—						—						(237)
Repurchases of common stock (Note 8)			(1,666)						(17)						—						(182,974)						—						(182,991)
Excise taxes related to repurchases of common stock			—						—						—						(1,627)						—						(1,627)
Net income			—						—						—						139,203						—						139,203
Total other comprehensive loss			—						—						—						—						(8,435)						(8,435)
Balance, June 30, 2025			148,542						1,485						261,782						2,262,301						(58,089)						2,467,479
Stock-based compensation			2						—						11,336						—						—						11,336
Shares issued upon vesting			126						2						2,226						—						—						2,228
Shares withheld for taxes			—						—						(7,437)						—						—						(7,437)
Repurchases of common stock (Note 8)			(2,580)						(26)						—						(281,971)						—						(281,997)
Excise taxes related to repurchases of common stock			—						—						—						(2,709)						—						(2,709)
Net income			—						—						—						268,152						—						268,152
Total other comprehensive income			—						—						—						—						8,978						8,978
Balance, September 30, 2025			146,090						1,461						267,907						2,245,773						(49,111)						2,466,030
Stock-based compensation			8						—						11,602						—						—						11,602
Shares issued upon vesting			6						—						—						—						—						—
Shares withheld for taxes			—						—						(395)						—						—						(395)
Repurchases of common stock (Note 8)			(3,773)						(38)						—						(348,462)						—						(348,500)
Excise taxes related to repurchases of common stock			—						—						—						(3,471)						—						(3,471)
Net income			—						—						—						481,145						—						481,145
Total other comprehensive income			—						—						—						—						3,043						3,043
Balance, December 31, 2025			142,331						$	1,423					$	279,114					$	2,374,985					$	(46,068)					$	2,609,454

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(amounts in thousands)

			Nine Months Ended December 31, 2024
			Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Total Stockholders’ Equity
			Shares						Amount
Balance, March 31, 2024			153,554						$	1,536					$	243,050					$	1,913,615					$	(50,733)					$	2,107,468
Stock-based compensation			2						—						8,231						—						—						8,231
Shares issued upon vesting			6						—						—						—						—						—
Exercise of stock options			54						1						600						—						—						601
Shares withheld for taxes			—						—						(495)						—						—						(495)
Repurchases of common stock (Note 8)			(1,062)						(11)						—						(151,956)						—						(151,967)
Excise taxes related to repurchases of common stock			—						—						—						(1,181)						—						(1,181)
Net income			—						—						—						115,625						—						115,625
Total other comprehensive loss			—						—						—						—						(3,800)						(3,800)
Balance, June 30, 2024			152,554						1,526						251,386						1,876,103						(54,533)						2,074,482
Stock-based compensation			2						—						11,657						—						—						11,657
Shares issued upon vesting			129						1						1,637						—						—						1,638
Exercise of stock options			9						—						93						—						—						93
Shares withheld for taxes			—						—						(12,561)						—						—						(12,561)
Repurchases of common stock (Note 8)			(686)						(7)						—						(104,316)						—						(104,323)
Excise taxes related to repurchases of common stock			—						—						—						(843)						—						(843)
Net income			—						—						—						242,321						—						242,321
Total other comprehensive income			—						—						—						—						10,775						10,775
Balance, September 30, 2024			152,008						1,520						252,212						2,013,265						(43,758)						2,223,239
Stock-based compensation			2						—						8,653						—						—						8,653
Shares issued upon vesting			8						—						—						—						—						—
Exercise of stock options			27						—						274						—						—						274
Shares withheld for taxes			—						—						(1,192)						—						—						(1,192)
Repurchases of common stock (Note 8)			(275)						(2)						—						(44,719)						—						(44,721)
Excise taxes related to repurchases of common stock			—						—						—						(382)						—						(382)
Net income			—						—						—						456,734						—						456,734
Total other comprehensive loss			—						—						—						—						(11,686)						(11,686)
Balance, December 31, 2024			151,770						$	1,518					$	259,947					$	2,424,898					$	(55,444)					$	2,630,919

See accompanying notes to the condensed consolidated financial statements.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(amounts in thousands)

			Nine Months Ended December 31,
			2025						2024
OPERATING ACTIVITIES
Net income			$	888,500					$	814,680
Reconciliation of net income to net cash provided by (used in) operating activities:
Depreciation, amortization, and accretion			57,141						50,911
Amortization on cloud computing arrangements			1,677						1,858
Bad debt expense			3,808						5,294
Deferred tax (benefit) expense			(13,714)						5,791
Stock-based compensation			31,703						28,774
Loss on disposal of assets			990						3,022
Impairment of property and equipment and cloud computing arrangements			127						3,699
Changes in operating assets and liabilities:
Trade accounts receivable, net			(15,262)						(11,809)
Inventories			(138,259)						(105,787)
Prepaid expenses and other current assets			(105,415)						2,502
Income tax receivable			28,929						16,364
Net operating lease assets and lease liabilities			1,828						(2,791)
Other assets			(23,873)						(6,161)
Trade accounts payable			185,956						206,893
Other accrued expenses			54,201						64,307
Income tax payable			118,817						46,781
Other long-term liabilities			8,959						(6,813)
Net cash provided by operating activities			1,086,113						1,117,515
INVESTING ACTIVITIES
Purchases of property and equipment			(67,541)						(69,729)
Proceeds from sale of assets			11						11,168
Net cash used in investing activities			(67,530)						(58,561)
FINANCING ACTIVITIES
Proceeds from issuance of stock			2,228						1,638
Proceeds from exercise of stock options			—						968
Repurchases of common stock			(813,488)						(301,011)
Cash paid for excise taxes related to repurchases of common stock			(5,042)						(3,985)
Cash paid for shares withheld for taxes			(8,069)						(14,248)
Net cash used in financing activities			(824,371)						(316,638)
Effect of foreign currency exchange rates on cash and cash equivalents			3,346						(3,444)
Net change in cash and cash equivalents			197,558						738,872
Cash and cash equivalents at beginning of period			1,889,188						1,502,051
Cash and cash equivalents at end of period			$	2,086,746					$	2,240,923

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(amounts in thousands)

(continued)

			Nine Months Ended December 31,
			2025						2024
SUPPLEMENTAL CASH FLOW DISCLOSURE
Cash paid during the period
Income taxes			$	136,879					$	182,282
Interest			1,745						1,246
Operating leases			67,353						52,165
Non-cash investing activities
Changes in trade accounts payable and other accrued expenses for purchases of property and equipment			(5,414)						979
Accrued for asset retirement obligation assets related to leasehold improvements			2,408						1,399
Non-cash financing activities
Accrued excise taxes related to repurchases of common stock			7,807						2,406

See accompanying notes to the condensed consolidated financial statements.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

NOTE 1. GENERAL

The Company. Deckers Outdoor Corporation and its wholly owned subsidiaries (collectively, the Company) is a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories developed for both everyday casual lifestyle use and high-performance activities. The Company’s five proprietary brands include the HOKA, UGG, Teva, Koolaburra, and AHNU brands. Refer to the section below entitled “Reportable Operating Segments” for information regarding the phase out of standalone operations for the Koolaburra and AHNU brands, and the prior sale of the Sanuk brand.

The Company sells its products through quality domestic and international retailers and international distributors in its wholesale channel, and directly to global consumers through its Direct-to-Consumer (DTC) channel, which is comprised of an e-commerce and retail store presence. Independent third-party contractors manufacture all of the Company’s products.

Basis of Presentation. The unaudited condensed consolidated financial statements and accompanying notes thereto (referred to herein as condensed consolidated financial statements) as of December 31, 2025, and for the three and nine months ended December 31, 2025 (current period), and 2024 (prior period) are prepared in accordance with generally accepted accounting principles in the US (US GAAP) for interim financial information pursuant to Rule 10-01 of Regulation S-X issued by the SEC. Accordingly, the condensed consolidated financial statements do not include all the information and disclosures required by US GAAP for annual financial statements and accompanying notes thereto. The condensed consolidated balance sheet as of the end of the prior fiscal year, is derived from the Company’s audited consolidated financial statements. In the opinion of management, the condensed consolidated financial statements include all normal and recurring entries necessary to fairly present the results of the interim periods presented but are not necessarily indicative of actual results to be achieved for full fiscal years or other interim periods. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto included in the 2025 Annual Report.

Consolidation. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Reportable Operating Segments. As of December 31, 2025, the Company’s three reportable operating segments include the worldwide operations of the HOKA brand, UGG brand, and Other brands (primarily consisting of the Teva brand, Koolaburra brand, and AHNU brand) (collectively, the Company’s reportable operating segments). The Other brands reportable operating segment includes current and historical results of brands previously sold and brands for which standalone operations have been phased out, as discussed below.

Consistent with the Company’s continuous focus on pursuing its most profitable long-term opportunities, management has taken the following strategic actions to streamline its brand portfolio:

• During the second quarter of its current fiscal year, the Company began taking steps to phase out standalone operations for the AHNU brand. The Company closed Ahnu.com as of October 1, 2025, and substantially completed the phase out of the AHNU brand in the wholesale channel during the current period. The Company did not incur material exit costs or obligations associated with this plan.

• During the third quarter of its prior fiscal year, the Company began taking steps to phase out standalone operations for the Koolaburra brand. The Company closed Koolaburra.com as of the end of the prior fiscal year and substantially completed the phase out of the Koolaburra brand in the wholesale channel during the current period. The Company did not incur material exit costs or obligations associated with this plan.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

• The Company completed the sale of the Sanuk brand during the second quarter of its prior fiscal year. The financial results for the Company’s reportable operating segments present the former Sanuk brand within the Other brands reportable operating segment through the Sanuk Brand Sale Date.

Refer to Note 10, “Reportable Operating Segments,” for further information on the Company’s reportable operating segments.

Use of Estimates. The preparation of the Company’s condensed consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the amounts reported. Management bases these estimates and assumptions upon historical experience, existing and known circumstances, authoritative accounting pronouncements and other factors that management believes to be reasonable. In addition, the Company has considered the potential impact of macroeconomic factors, including inflation, changes in tariff rates, foreign currency exchange rate volatility, changes in interest rates, changes in commodity pricing, changes in discretionary spending, and recessionary concerns, on its business and operations. Although the full impact of these factors is unknown, the Company believes it has made appropriate accounting estimates and assumptions based on the facts and circumstances available as of the reporting date. However, actual results could differ materially from these estimates and assumptions, which may result in material effects on the Company’s financial condition, results of operations, and liquidity. Refer to Note 1, “General,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the significant areas requiring the use of management estimates and assumptions.

Foreign Currency Translation. The Company considers the US dollar to be its functional currency. The Company’s wholly owned foreign subsidiaries have various assets and liabilities, primarily cash, receivables, and payables, which are denominated in currencies other than its functional currency. The Company remeasures these monetary assets and liabilities using the exchange rate at the end of the reporting period, which results in gains and losses that are recorded in selling, general, and administrative (SG&A) expenses in the condensed consolidated statements of comprehensive income as incurred. In addition, the Company translates assets and liabilities of subsidiaries with reporting currencies other than US dollars into US dollars using the exchange rates at the end of the reporting period, which results in financial statement translation gains and losses recorded in other comprehensive income or loss (OCI), net of tax, in the condensed consolidated statements of comprehensive income.

Seasonality. A significant part of the UGG brand’s business has historically been seasonal, with the highest percentage of net sales occurring in the third fiscal quarter, which has contributed to variation in results of operations from quarter to quarter. However, the Company has mitigated the impacts of seasonality by diversifying and expanding product offerings with additional year-round styles. In addition, as the HOKA brand’s net sales, which generally occur more evenly throughout the fiscal year, continue to increase as a percentage of the Company’s aggregate net sales, the Company expects to reduce the impacts of seasonality in future periods.

Supplier Finance Program. As of December 31, 2025, and March 31, 2025, the Company had immaterial balances outstanding related to the Supplier Finance Program (SFP) that are presented in trade accounts payable in the condensed consolidated balance sheets. Refer to Note 14, “Supplier Finance Program,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information regarding the SFP.

Recent Accounting Pronouncements. Other than those outlined below, there have been no developments with respect to recently issued accounting standards relative to those disclosed in the 2025 Annual Report, including the expected dates of adoption and impact on disclosures in the Company’s annual consolidated financial statements and interim condensed consolidated financial statements. The adoption of Accounting Standards Update (ASU) 2023-09, Improvements to Income Tax Disclosures, is not expected to have an impact on the Company’s annual consolidated balance sheets, statements of comprehensive income, or cash flows, as it pertains to annual disclosures only.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

Not Yet Adopted. The following is a summary of each ASU that has been issued during the nine months ended December 31, 2025, and is applicable to the Company, but which has not yet been adopted, as well as the planned period of adoption, and the expected impact on the Company upon adoption:

Standard						Description						Planned Period of Adoption						Expected Impact on Adoption
ASU 2025-05 - Measurement of Credit Losses for Accounts Receivable and Contract Assets						This ASU provides a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset when estimating expected credit losses on trade accounts receivable and contract assets. This ASU is effective on a prospective basis for fiscal years beginning after December 15, 2025. Early adoption is permitted.						Q1 FY 2027						The Company is currently evaluating the impact of the adoption of this ASU on its annual consolidated financial statements and interim condensed consolidated financial statements.
ASU 2025-06 - Internal-Use Software						This ASU amends recognition and disclosure guidance for internal-use software costs, removing the previous software development stage model with a more principles-based, probable-to-complete recognition threshold. This ASU is effective on either a retrospective, prospective, or modified prospective basis, for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. Early adoption is permitted.						Q1 FY 2029						The Company is currently evaluating the impact of the adoption of this ASU on its annual consolidated financial statements and interim condensed consolidated financial statements.
ASU 2025-09 - Derivatives and Hedging (Topic 815): Hedge Accounting Improvements						This ASU clarifies and improves certain aspects of hedge accounting, including guidance on the assessment of similar risk exposure for groups of forecasted transactions related to cash flow hedges and other targeted amendments intended to better align hedge accounting with an entity’s risk management activities. This ASU is effective on a prospective basis for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted.						Q1 FY 2028						The Company is currently evaluating the impact of the adoption of this ASU on its annual consolidated financial statements and interim condensed consolidated financial statements.
ASU 2025-11 - Interim Reporting: Narrow-Scope Improvements						This ASU requires disclosure of events since the most recent annual reporting period that have a material impact on interim results, provides a comprehensive list of required interim disclosures, and clarifies the form and content requirements for interim financial statements. This ASU is effective on either a prospective or retrospective basis for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted.						Q1 FY 2029						The Company is currently evaluating the impact of the adoption of this ASU on disclosures in its interim condensed consolidated financial statements.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

NOTE 2. REVENUE RECOGNITION AND BUSINESS CONCENTRATIONS

Disaggregated Revenue. Refer to Note 10, “Reportable Operating Segments,” for further information on the Company’s disaggregation of revenue by reportable operating segment.

Channel Concentration. Net sales by channel was as follows:

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Wholesale			$	864,570					$	815,828					$	2,553,163					$	2,244,263
Direct-to-Consumer			1,092,979						1,011,337						1,799,764						1,719,569
Total			$	1,957,549					$	1,827,165					$	4,352,927					$	3,963,832

Geographic Concentration. Net sales by geography was as follows:

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Domestic			$	1,200,889					$	1,169,291					$	2,541,677					$	2,539,057
International			756,660						657,874						1,811,250						1,424,775
Total			$	1,957,549					$	1,827,165					$	4,352,927					$	3,963,832

For the three and nine months ended December 31, 2025, and 2024, no single foreign country comprised 10.0% or more of the Company’s total net sales.

Customer Concentration. For the three and nine months ended December 31, 2025, and 2024, no single global customer comprised 10.0% or more of the Company’s total net sales. As of December 31, 2025, the Company has one customer that represents 12.0% of trade accounts receivable, net, compared to one customer that represents 13.6% of trade accounts receivable, net, as of March 31, 2025. Management performs regular evaluations concerning the ability of the Company’s customers to satisfy their obligations to the Company and recognizes an allowance for doubtful accounts based on these evaluations.

Sales Return Asset and Liability. Sales returns are a refund asset for the right to recover the inventory and a refund liability for the stand-ready right of return. The refund asset for the right to recover the inventory is recorded in other current assets and the related refund liability is recorded in other accrued expenses in the condensed consolidated balance sheets.

The following tables summarize changes in the estimated sales returns for the periods presented:

			Sales Return Asset						Sales Return Liability
Balance, March 31, 2025			$	21,120					$	(63,462)
Net additions to sales return liability (1)			66,243						(269,629)
Actual returns			(50,963)						213,633
Balance, December 31, 2025			$	36,400					$	(119,458)

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

			Sales Return Asset						Sales Return Liability
Balance, March 31, 2024			$	13,866					$	(55,327)
Net additions to sales return liability (1)			63,580						(266,277)
Actual returns			(47,842)						216,359
Balance, December 31, 2024			$	29,604					$	(105,245)

(1) Net additions to the sales return liability include a provision for anticipated sales returns, which consists of both contractual return rights and discretionary authorized returns.

Contract Liabilities. Contract liabilities are recorded in other accrued expenses in the condensed consolidated balance sheets and include loyalty programs and other deferred revenue.

Loyalty Programs. Activity related to loyalty programs was as follows:

			Nine Months Ended December 31,
			2025						2024
Beginning balance			$	(18,566)					$	(17,586)
Redemptions and expirations for loyalty certificates and points recognized in net sales			66,809						45,884
Deferred revenue for loyalty points and certificates issued			(87,347)						(56,363)
Ending balance			$	(39,104)					$	(28,065)

Deferred Revenue. Activity related to deferred revenue was as follows:

			Nine Months Ended December 31,
			2025						2024
Beginning balance			$	(27,305)					$	(9,591)
Additions of customer cash payments			(71,472)						(69,422)
Revenue recognized			75,571						60,217
Ending balance			$	(23,206)					$	(18,796)

Refer to Note 2, “Revenue Recognition,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the Company’s variable consideration accounting policies, including sales return asset and liability, as well as contract liabilities.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

NOTE 3. FAIR VALUE MEASUREMENTS

The Company measures certain financial assets and liabilities at fair value on a recurring basis. Refer to Note 4, “Fair Value Measurements,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the Company’s fair value accounting policies.

Assets and liabilities that are measured on a recurring basis at fair value in the condensed consolidated balance sheets are as follows:

			As of						Measured Using
			December 31, 2025			Level 1						Level 2						Level 3
Assets:
Cash equivalents:
Money-market funds			$	1,699,688					$	1,699,688					$	—					$	—
Other current assets:
Designated Derivative Contracts asset			432						—						432						—
Non-Designated Derivative Contracts asset			37						—						37						—
Other assets:
Designated Derivative Contracts asset			111						—						111						—
Non-qualified deferred compensation asset			23,524						23,524						—						—
Total assets measured at fair value			$	1,723,792					$	1,723,212					$	580					$	—
Liabilities:
Other accrued expenses:
Designated Derivative Contracts liability			$	(5,558)					$	—					$	(5,558)					$	—
Non-qualified deferred compensation liability			(2,082)						(2,082)						—						—
Other long-term liabilities:
Designated Derivative Contracts liability			(235)						—						(235)						—
Non-qualified deferred compensation liability			(30,308)						(30,308)						—						—
Total liabilities measured at fair value			$	(38,183)					$	(32,390)					$	(5,793)					$	—

			As of						Measured Using
			March 31, 2025			Level 1						Level 2						Level 3
Assets:
Cash equivalents:
Money-market funds			$	1,485,555					$	1,485,555					$	—					$	—
Other current assets:
Designated Derivative Contracts asset			2,163						—						2,163						—
Non-Designated Derivative Contracts asset			75						—						75						—
Other assets:
Non-qualified deferred compensation asset			16,967						16,967						—						—
Total assets measured at fair value			$	1,504,760					$	1,502,522					$	2,238					$	—

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

			As of						Measured Using
			March 31, 2025			Level 1						Level 2						Level 3
Liabilities:
Other accrued expenses:
Designated Derivative Contracts liability			$	(64)					$	—					$	(64)					$	—
Non-qualified deferred compensation liability			(2,345)						(2,345)						—						—
Other long-term liabilities:
Non-qualified deferred compensation liability			(22,793)						(22,793)						—						—
Total liabilities measured at fair value			$	(25,202)					$	(25,138)					$	(64)					$	—

The fair value of Designated Derivative Contracts and Non-Designated Derivative Contracts is determined using quoted forward spot rates at the end of the applicable reporting period from counterparties, which are corroborated by market-based pricing (Level 2), with related assets and liabilities recorded in other current assets and other accrued expenses, respectively, in the condensed consolidated balance sheets. Refer to Note 7, “Derivative Instruments,” for further information, including the definition of the terms Designated Derivative Contracts and Non-Designated Derivative Contracts.

NOTE 4. INCOME TAXES

Income tax expense and the effective income tax rate were as follows:

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Income tax expense			$	145,768					$	127,208					$	263,835					$	237,327
Effective income tax rate			23.3		%				21.8		%				22.9		%				22.6		%

The tax provisions during the three and nine months ended December 31, 2025, and 2024, were computed using the estimated effective income tax rate applicable to each of the domestic and foreign taxable jurisdictions for the current fiscal year, and prior fiscal year, respectively, and were adjusted for discrete items that occurred within the periods presented above.

During the three months ended December 31, 2025, the net change in the effective income tax rate, compared to the prior period, was primarily due to jurisdictional mix of worldwide income before income taxes, as well as non-recurring tax benefits for audit settlements in the prior period and reduced tax benefits from net discrete items, including a change in return-to-provision adjustments and stock-based compensation; partially offset by changes in valuation allowances on tax attributes.

During the nine months ended December 31, 2025, the net change in the effective income tax rate, compared to the prior period, was primarily due to jurisdictional mix of worldwide income before income taxes, as well as reduced tax benefits from net discrete items, including for stock-based compensation and reserve adjustments; partially offset by changes in valuation allowances on tax attributes.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

Changes in Tax Law. The Company has evaluated and is currently monitoring the impact of recent tax law changes on its condensed consolidated financial statements for the following:

• On July 4, 2025, H.R. 1, also known as the One Big Beautiful Bill Act (OBBBA), was signed into law. The OBBBA includes, among other provisions, changes to US corporate income tax law, including restoration of accelerated depreciation on capital expenditures, deductible research and development expenses, and modifications to the international tax framework. The OBBBA has multiple effective dates, with certain provisions effective in the current fiscal year and others effective in fiscal year ending March 31, 2027. The Company has estimated the tax effects of OBBBA, which did not have a material impact on its condensed consolidated financial statements during the current period, while providing cash tax benefits in the current fiscal year due to accelerated tax deductions.

• Various jurisdictions in which the Company operates have enacted legislation in response to Pillar Two model rules (Pillar Two) that were previously released by the Organization for Economic Co-operation and Development (commonly known as OECD). The impact of the Pillar Two legislation during the current period did not have a material impact on the Company’s condensed consolidated financial statements. The Company will continue to monitor Pillar Two developments and reflect the impact of legislative changes in future periods.

NOTE 5. COMMITMENTS AND CONTINGENCIES

Leases. The Company enters into operating lease contracts, which primarily relate to retail stores, showrooms, offices, and distribution facilities. There were no material changes outside the ordinary course of business during the nine months ended December 31, 2025, to the Company’s operating lease terms disclosed in the 2025 Annual Report.

Supplemental information for amounts presented in the condensed consolidated statements of cash flows related to operating leases was as follows:

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Non-cash operating activities (1)
Operating lease assets obtained in exchange for lease liabilities			$	18,250					$	23,814					$	119,250					$	39,912
Reductions to operating lease assets for reductions to lease liabilities			(11)						(229)						(2,692)						(1,350)

(1) Amounts disclosed include non-cash additions or reductions resulting from lease remeasurements, as well as adjustments for tenant improvement allowances. Non-cash additions in the current period predominately include investments in the Company’s global retail store footprint that are in the ordinary course of business.

As of December 31, 2025, operating lease liabilities recorded in the condensed consolidated balance sheets exclude an aggregate of $86,785 of undiscounted minimum lease payments due pursuant to leases signed during the nine months ended December 31, 2025 but not yet commenced, which primarily relate to leases for new retail stores that the Company expects will commence during the first half of calendar year 2027.

Purchase Obligations. Except as noted below, there were no material changes outside the ordinary course of business during the nine months ended December 31, 2025, to the Company’s purchase obligations disclosed in the 2025 Annual Report.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

3PL Agreements. During the nine months ended December 31, 2025, the Company entered into a 3PL service agreement with a non-cancellable minimum commitment of approximately $93,611 payable through March 31, 2029, related to the transition of one of its international 3PLs to a new partner with an upgraded warehouse management system which the Company expects to be operational in the first quarter of its fiscal year ending March 31, 2027 (next fiscal year).

Litigation. From time to time, the Company is involved in various legal proceedings, disputes, and other claims arising in the ordinary course of business, including employment, intellectual property, and product liability claims. Although the results of these matters cannot be predicted with certainty, the Company believes it is not currently a party to any legal proceedings, disputes, or other claims for which a material loss is considered probable and for which the amount (or range) of loss is reasonably estimable.

Refer to Note 7, “Commitments and Contingencies,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the Company’s contractual obligations and commitments.

NOTE 6. STOCK-BASED COMPENSATION

Stock Incentive Plans. The 2024 Stock Incentive Plan (2024 SIP) provides for the issuance of a variety of stock-based compensation awards, including time-based restricted stock units (RSUs), performance-based restricted stock units (PSUs), long-term incentive plan PSUs (LTIP PSUs), stock appreciation rights, stock bonuses, incentive stock options (ISOs), and non-qualified stock options, to employees, directors, consultants, independent contractors, and advisors. In September 2024, the 2024 SIP replaced the 2015 Stock Incentive Plan (2015 SIP).

Refer to Note 8, “Stock-Based Compensation,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information about the terms of the 2024 SIP and 2015 SIP.

Annual Stock Awards. The Company granted the following awards during the periods presented:

						Nine Months Ended December 31,
						2025												2024
Award Type						Number of Shares						Weighted-Average Grant Date Fair Value						Number of Shares						Weighted-Average Grant Date Fair Value
RSUs						315,680						$	102.83					159,891						$	159.73
LTIP PSUs (1)						137,430						103.90						72,213						173.09

(1) The amounts reported reflect achievement of the target performance level under the terms of the applicable LTIP PSUs.

During the nine months ended December 31, 2025, with the exception of the RSU and LTIP PSU awards summarized above, no material additional awards were granted under the 2024 SIP.

Future unrecognized stock-based compensation for RSUs outstanding as of December 31, 2025, is $34,438.

For the LTIP PSUs granted during the current fiscal year, prior fiscal year, and fiscal year ended March 31, 2024, the Company expects to exceed the minimum threshold target performance criteria based on the Company’s current long-range forecast as of December 31, 2025. Future unrecognized stock-based compensation for all LTIP PSUs outstanding as of December 31, 2025, based on the anticipated performance level, is $25,724.

Refer to Note 8, “Stock-Based Compensation,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the Company’s prior grants of stock-based compensation awards.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

NOTE 7. DERIVATIVE INSTRUMENTS

The Company enters into foreign currency forward or option contracts (derivative contracts) to manage foreign currency risk and certain of these derivative contracts are designated as cash flow hedges of forecasted sales (Designated Derivative Contracts). The Company also enters into derivative contracts that are not designated as cash flow hedges, to offset a portion of anticipated gains and losses on certain intercompany balances until the expected time of repayment (Non-Designated Derivative Contracts). Refer to Note 1, “General,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information related to accounting policies on the Company’s derivative contracts.

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

			December 31, 2025
			Designated Derivative Contracts						Non-Designated Derivative Contracts						Total
Notional value			$	311,230					$	14,630					$	325,860
Fair value recorded in other current assets			432						37						469
Fair value recorded in other assets			111						—						111
Fair value recorded in other accrued expenses			(5,558)						—						(5,558)
Fair value recorded in other long-term liabilities			(235)						—						(235)

			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)

As of December 31, 2025, five counterparties hold the Company’s outstanding derivative contracts, which are expected to mature in the next 15 months. As of March 31, 2025, five counterparties held the Company’s outstanding derivative contracts.

The following table summarizes changes in unrealized (loss) gain on cash flow hedges included in accumulated other comprehensive loss (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 condensed consolidated statements of comprehensive income:

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Beginning balance			$	(8,497)					$	(3,466)					$	1,584					$	—
Gain (loss) recorded in OCI			1,765						6,575						(19,996)						2,219
Reclassifications from AOCL into net sales			4,192						1,389						12,648						1,161
Income tax (expense) benefit in OCI			(1,440)						(1,943)						1,784						(825)
Ending balance			$	(3,980)					$	2,555					$	(3,980)					$	2,555

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

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 December 31, 2025, the amount of unrealized loss on derivative contracts recorded in AOCL is expected to be reclassified into net sales within the next 15 months. Refer to Note 8, “Stockholders’ Equity,” for further information on the components of AOCL.

Subsequent to December 31, 2025, through January 13, 2026, the Company entered into Designated Derivative Contracts with notional values totaling $31,071, which are expected to mature within the next 15 months and are held by one counterparty.

NOTE 8. STOCKHOLDERS’ EQUITY

Stock Repurchase Program. The Company’s Board of Directors (Board) has approved various authorizations under the Company’s stock repurchase program 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 December 31, 2025, the aggregate remaining approved amount under the stock repurchase program is $1,811,214. 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.

Stock repurchase activity under the stock repurchase program was as follows:

			Nine Months Ended December 31,
			2025						2024
Total number of shares repurchased (1)			8,019,067						2,022,299
Weighted average price per share			$	101.44					$	148.85
Dollar value of shares repurchased (2) (3)			$	813,488					$	301,011

(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.

Subsequent to December 31, 2025, through January 13, 2026, the Company repurchased 381,039 shares at a weighted average price of $104.98 per share for $40,000 and had $1,771,214 remaining authorized under the stock repurchase program.

Accumulated Other Comprehensive Loss. The components within AOCL, net of tax, recorded in the condensed consolidated balance sheets, are as follows:

			December 31, 2025						March 31, 2025
Unrealized (loss) gain on cash flow hedges			$	(3,980)					$	1,584
Cumulative foreign currency translation loss			(42,088)						(51,238)
Total			$	(46,068)					$	(49,654)

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

NOTE 9. BASIC AND DILUTED SHARES

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

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Basic			144,076,000						151,820,000						146,929,000						152,307,000
Dilutive effect of equity awards			213,000						566,000						273,000						617,000
Diluted			144,289,000						152,386,000						147,202,000						152,924,000
Excluded
RSUs			158,000						—						73,000						16,000
LTIP PSUs			350,000						272,000						350,000						292,000
Deferred Non-Employee Director Equity Awards			7,000						1,000						7,000						1,000
Employee Stock Purchase Plan			5,000						3,000						3,000						—

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 8, “Stock-Based Compensation,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report for further information on the Company’s equity incentive plans.

NOTE 10. REPORTABLE OPERATING SEGMENTS

Information reported to the Chief Operating Decision Maker (CODM), who is the Principal Executive Officer (PEO), 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 Company does not regularly provide total assets or capital expenditures information by reportable operating segments to the CODM because that information is not used to evaluate performance or allocate resources to each reportable operating segment.

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; depreciation and other related costs; and other segment items. There are no inter-segment sales for any period presented. The accounting policies applicable to the Company’s reportable operating segments are consistent with those described in Note 1, “General,” in the Company’s consolidated financial statements in Part IV of the 2025 Annual Report.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

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 DCs 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 DCs and 3PL service fees, along with enterprise costs, which include centralized commercial operations, IT, finance, human resources, legal, supply chain, and corporate executives.

Reportable operating segment information, with a reconciliation to the condensed consolidated statements of comprehensive income, was as follows:

Three Months Ended December 31, 2025			HOKA						UGG						Other Brands (5)						Total
Net sales			$	628,882					$	1,305,475					$	23,192					$	1,957,549
Less: Cost of sales (1)			274,678						496,554						14,957						786,189
Segment gross profit			354,204						808,921						8,235						1,171,360
Segment gross margin			56.3		%				62.0		%				35.5		%				59.8		%
Less: (1)
Payroll and related costs			33,681						45,409						4,586						83,676
Advertising, marketing, and promotion expenses			63,439						96,669						2,288						162,396
Rent and occupancy			11,826						26,677						25						38,528
Depreciation and other related costs (2)			2,273						2,940						6						5,219
Other segment items (3)			26,891						47,297						(2,745)						71,443
Segment SG&A expenses			138,110						218,992						4,160						361,262
Segment income from operations			$	216,094					$	589,929					$	4,075					$	810,098
Segment operating margin (4)			34.4		%				45.2		%				17.6		%				41.4		%

Three Months Ended December 31, 2024			HOKA						UGG						Other Brands (5)						Total
Net sales			$	530,908					$	1,244,189					$	52,068					$	1,827,165
Less: Cost of sales (1)			233,030						460,738						30,774						724,542
Segment gross profit			297,878						783,451						21,294						1,102,623
Segment gross margin			56.1		%				63.0		%				40.9		%				60.3		%
Less: (1)
Payroll and related costs			26,003						43,864						4,228						74,095
Advertising, marketing, and promotion expenses			56,396						81,537						6,121						144,054
Rent and occupancy			7,310						25,523						79						32,912
Depreciation and other related costs (2)			1,372						2,505						117						3,994
Other segment items (3)			19,864						41,160						3,385						64,409
Segment SG&A expenses			110,945						194,589						13,930						319,464
Segment income from operations			$	186,933					$	588,862					$	7,364					$	783,159
Segment operating margin (4)			35.2		%				47.3		%				14.1		%				42.9		%

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

Nine Months Ended December 31, 2025			HOKA						UGG						Other Brands (5)						Total
Net sales			$	1,916,087					$	2,330,154					$	106,686					$	4,352,927
Less: Cost of sales (1)			820,182						960,370						59,287						1,839,839
Segment gross profit			1,095,905						1,369,784						47,399						2,513,088
Segment gross margin			57.2		%				58.8		%				44.4		%				57.7		%
Less: (1)
Payroll and related costs			94,625						117,160						13,571						225,356
Advertising, marketing, and promotion expenses			191,008						171,941						13,406						376,355
Rent and occupancy			31,305						62,343						81						93,729
Depreciation and other related costs (2)			5,356						9,014						51						14,421
Other segment items (3)			82,692						93,141						5,759						181,592
Segment SG&A expenses			404,986						453,599						32,868						891,453
Segment income from operations			$	690,919					$	916,185					$	14,531					$	1,621,635
Segment operating margin (4)			36.1		%				39.3		%				13.6		%				37.3		%

Nine Months Ended December 31, 2024			HOKA						UGG						Other Brands (5)						Total
Net sales			$	1,646,982					$	2,157,005					$	159,845					$	3,963,832
Less: Cost of sales (1)			691,678						875,735						90,524						1,657,937
Segment gross profit			955,304						1,281,270						69,321						2,305,895
Segment gross margin			58.0		%				59.4		%				43.4		%				58.2		%
Less: (1)
Payroll and related costs			72,088						107,387						13,162						192,637
Advertising, marketing, and promotion expenses			168,275						144,989						20,337						333,601
Rent and occupancy			19,827						57,183						351						77,361
Depreciation and other related costs (2)			3,779						7,393						4,326						15,498
Other segment items (3)			58,923						77,223						10,261						146,407
Segment SG&A expenses			322,892						394,175						48,437						765,504
Segment income from operations			$	632,412					$	887,095					$	20,884					$	1,540,391
Segment operating margin (4)			38.4		%				41.1		%				13.1		%				38.9		%

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(2) Depreciation and other related costs generally include depreciation of property and equipment, amortization and impairment of intangible assets or other long-lived assets, accretion, and loss on disposal of assets.

(3) Other segment items are comprised of other SG&A expenses, which generally include credit card fees, commissions, materials and supplies, travel, certain 3PL service fees, net bad debt expense, and other miscellaneous expenses.

(4) Operating margin is defined as income from operations divided by net sales.

(5) The Other brands reportable operating segment for the three and nine months ended December 31, 2025 includes financial results for the Koolaburra and AHNU brands through their respective phase out dates. The Other brands reportable operating segment for the nine months ended December 31, 2024 includes financial results for the Sanuk brand through the Sanuk Brand Sale Date. Refer to the section titled “Reportable Operating Segments,” in Note 1, “General,” for further information regarding the phase out of standalone operations of the Koolaburra and AHNU brands, and the prior sale of the Sanuk brand.

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the Three and Nine Months Ended December 31, 2025, and 2024

(amounts in thousands, except per share and share data)

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

			Three Months Ended December 31,												Nine Months Ended December 31,
			2025						2024						2025						2024
Segment income from operations			$	810,098					$	783,159					$	1,621,635					$	1,540,391
Unallocated enterprise and shared brand expenses (1)			(195,732)						(215,885)						(515,461)						(535,224)
Total other income, net			12,547						16,668						46,161						46,840
Consolidated income before income taxes			$	626,913					$	583,942					$	1,152,335					$	1,052,007

(1) The change in reportable operating segments had an impact on segment income from operations, a measure of segment profitability, and a clarification was made that certain prior unallocated overhead costs are defined as unallocated enterprise and shared brand expenses and are excluded from the measure of segment profitability.