Hoka's Growth Stalls as Nike and On Close In

Quick Facts

Hoka revenue rose 7.7% to $703.5 million in Q1 FY2027, down from 34% growth in Q1 FY2025.
Deckers Brands topped $1 billion in quarterly revenue for the first time, but net income fell nearly 7% to $130 million.
Analysts at Evercore ISI cut their rating and warned that Nike and On are directly targeting Hoka’s core cushioned running segment.

Hoka is still growing. But the days of 30%-plus quarterly gains appear to be over, and Wall Street has taken notice.

Parent company Deckers Brands reported Q1 fiscal 2027 results on July 23, showing Hoka revenue climbed 7.7% year over year to $703.5 million. That gain helped push Deckers past $1 billion in quarterly net sales for the first time, with total revenue up 5.7% to $1.02 billion. Still, the number fell short of investor expectations and continued a trend of decelerating growth.

Two years ago, Hoka was posting quarterly growth of 34%. In fiscal 2025, the brand grew 23.6% for the full year, reaching $2.233 billion in revenue. By Q4 of that fiscal year, growth had dropped to 10%. Now it sits at 7.7%.

What Is Driving the Slowdown

Deckers executives pointed to several factors weighing on domestic performance. U.S. direct-to-consumer sales dipped 1.6% in Q4 FY2025 as consumers pulled back amid macroeconomic uncertainty. Higher promotions on older models hurt margins. New customer acquisition also weakened.

Wholesale grew 12.3% in that same quarter, but the channel shift raises questions about long-term brand positioning and pricing power. Consumers appear to be gravitating toward lower-priced alternatives, a challenge for a premium brand like Hoka.

Gross margin in Q1 FY2027 expanded 60 basis points to 56.4%, but net income fell nearly 7% to $130 million. The cost of growth is rising even as the pace of that growth slows.

Analysts Sound the Alarm

Evercore ISI flagged Nike’s spring 2027 lineup and On Holding’s Surreal foam platform as direct threats in cushioned running, the segment Hoka built its brand on. “The high growth story is behind us,” Evercore ISI wrote in an analyst note, cutting its rating on Deckers.

Jefferies analysts went further, arguing that Hoka’s slowdown could help Nike claw back athletic footwear market share. “The slowdown is a sign of the reinvigorated momentum of Nike’s innovation and wholesale penetration,” the firm wrote.

William Blair analyst Dylan Carden was blunt: “I think you call that a deceleration.”

Wells Fargo flagged that Deckers’ own guidance, which calls for Hoka net sales to grow by a low-double-digit percentage this fiscal year, came in below street expectations. The bank warned that some investors may view this “as a visible deterioration in Hoka demand.”

Where Hoka Still Has Room to Run

International business remains a genuine bright spot. Global revenue grew 39% and now accounts for 34% of Hoka’s total sales. The brand opened a new flagship store in Shanghai and is expanding across Europe, benefiting from a running boom in Asia.

Hoka, On Holding, and Brooks Running have all posted double-digit growth in China, driven by surging demand from the country’s growing base of recreational runners.

CEO Stefano Caroti struck a confident tone on the earnings call. “We’re still in the early miles of a long-distance run,” he said. CFO Steve Fasching pointed to record revenue, over $1 billion in free cash flow generated in fiscal 2026, and share repurchases as evidence of the company’s financial health.

The Competitive Pressure Is Real

On Holding reported 40% sales growth in early 2025. Hoka and On have tracked each other closely for years as both brands challenged Nike and Adidas in performance running. The gap between them is now widening in On’s favor.

For DTC operators and wholesale buyers, Hoka’s trajectory matters. The brand has driven significant foot traffic and margin in the specialty run channel. A sustained slowdown could shift retailer assortment decisions heading into 2027.

Deckers remains profitable and well-capitalized. But Hoka’s position as the undisputed growth engine of the running footwear category is no longer a given.