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    ONON
    Earnings call· Mar 2026(Q1 FY26)

    On Holding AG Q1 FY26 earnings call ONON

    May 12, 2026 Source

    Executive summary

    On Holding AG Q1 FY26 — Record Revenue and Strong Profitability Driven by Premium Strategy

    On Holding AG delivered a strong first quarter, achieving record revenue and profitability driven by its premium strategy, broad-based demand across regions and categories, and continued innovation. The company is navigating a leadership transition with co-CEOs and a new CFO, while reaffirming its commitment to high-quality growth and strategic investments in product, brand, and retail. The focus remains on expanding its premium market position and driving long-term value creation.

    Highlights

    5

    • Net sales exceeded CHF 830 million, growing 26.4% at constant currency.

    • Gross profit margin reached a record 64.2%, up 430 basis points year-over-year.

    • Adjusted EBITDA margin was 21%, increasing 450 basis points year-over-year.

    • Asia Pacific net sales grew 61.4% at constant currency, exceeding 20% of overall business for the first time.

    • Apparel net sales grew 57.5% at constant currency, contributing over 10% of D2C sales.

    Concerns

    3

    • Americas reported net sales growth was 3.1%, reflecting significant foreign exchange headwinds compared to 17.1% constant currency growth.

    • The company noted an unpredictable macroeconomic backdrop and an increasingly promotional market, though it maintains a full-price strategy.

    • Guidance assumes 20% incremental tariff rates from Vietnam, impacting profitability.

    Guidance & targets

    7
    CategoryTargetConfidence
    Full-year 2026 Net Sales Growth
    at least 23%
    high materiality
    High
    Full-year 2026 Reported Net Sales
    CHF 3.5 billion
    high materiality
    High
    Full-year 2026 Gross Margin
    at least 64.5%
    high materiality
    High
    Full-year 2026 Adjusted EBITDA Margin
    19.5% to 20%
    high materiality
    High
    D2C Channel Growth Rate
    similar to Q1
    medium materiality
    High
    Wholesale Channel Growth Rate
    slower than D2C
    medium materiality
    Medium
    Full-year 2026 Marketing Expenses as % of Net Sales
    13% to 13.5%
    medium materiality
    Medium

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Americas
    Achieved a new quarterly record for net sales, with strong constant currency growth despite significant foreign exchange headwinds. Brand awareness crossed the 30% mark.
    Constant Currency Growth: 17.1%
    		CHF 450.7 million3.1%——
    EMEA
    Marked the sixth consecutive quarter of more than 25% constant currency growth, driven by broad-based performance across countries like the U.K. and Germany, despite geopolitical situations in the Middle East.
    Constant Currency Growth: 25.6%
    		CHF 207.1 million22.8%——
    Asia Pacific
    Continued rapid controlled expansion, exceeding 20% of overall business for the first time. Growth was balanced across subregions and channels, with Greater China growing well above regional average and South Korea net sales more than tripling year-over-year.
    Constant Currency Growth: 61.4%Share of Overall Business: >20%
    		CHF 174 million44.4%——
    Direct-to-Consumer Channel
    Led growth for the company, with digital and physical traffic outstripping revenue growth, indicating strong brand momentum and future potential. Apparel contributed over 10% of D2C sales for the first time.
    Constant Currency Growth: 28.7%
    		CHF 322.3 million16.4%——
    Wholesale Channel
    Delivered strong growth, exceeding CHF 0.5 billion in quarterly net sales for the first time. Continued momentum with global key accounts, with significant room for further door expansion.
    Constant Currency Growth: 25.1%
    		CHF 509.6 million13.3%——

    Operational metrics

    12
    Net Sales
    CHF 831.9 million26.4% constant currency YoY; 14.5% reported YoY
    Q1 FY26

    First time crossing the CHF 800 million mark.

    Adjusted EBITDA Margin
    21%up 450 bps YoY
    Q1 FY26

    Second highest adjusted EBITDA margin in company history, reflecting underlying strength of premium strategy.

    Distribution Expenses as % of Net Sales
    10%down 100 bps YoY
    Q1 FY26

    Mainly driven by ongoing automation of global warehouses.

    G&A as % of Net Sales
    16%lowest level in 2 years
    Q1 FY26

    Saw meaningful scale gains, offsetting foreign exchange headwinds from Swiss franc heavy overhead cost base.

    Capital Expenditures
    CHF 23.6 millionup from 1.7% of net sales in prior year
    Q1 FY26

    Continued investment in stores and store expansion.

    Cash Position
    over CHF 1 billionstable compared to year-end
    Q1 FY26

    Strong cash balance maintained.

    Average Selling Price (ASP)
    over USD 170up from USD 145
    Q1 FY26

    Reflects consumers trading up to premium performance products.

    Apparel Net Sales
    CHF 55.3 million57.5% constant currency YoY; 45.1% reported YoY
    Q1 FY26

    Increasingly important entry point into the brand, with strong growth in D2C.

    Shoes Net Sales
    CHF 763.7 million24% constant currency YoY; 12.2% reported YoY
    Q1 FY26

    Majority of growth from blockbuster franchises, with meaningful volumes from newer franchises.

    Cloudzone Volume Growth
    >350%YoY
    Q1 FY26

    Growth from a low base, demonstrating success of newer franchises.

    US Brand Awareness
    >30%for the first time
    Q1 FY26

    Important milestone in brand recognition.

    Run Specialty Accounts Order Books
    >25%YoY
    Q1 FY26

    Partners ordering with strong conviction for upcoming products.

    Industry KPIs

    6
    MetricValueDetails
    Inventory position—
    Revenue by channelCHF 831.9 millionCHF
    Operating margin sg a—
    Store fleet door investment—
    Tariff cost exposure recovery—
    Franchise product cycle performance—

    Product announcements

    8
    ProductTypeDetails
    LightSpray Factoryexpansion
    Cloudmonster Hyperlaunch
    Cloudmonster 3update
    SURREAL SuperFoamlaunch
    Cloudtilt Remixupdate
    Cloudnova Moonlaunch
    SenseTecexpansion
    Formtechlaunch

    Deals & partnerships

    2
    ZendayaCo-created apparel range and Cloudnova Moon launch

    Collaboration with Zendaya for an apparel range and the Cloudnova Moon shoe, targeting younger and more lifestyle-oriented consumers.

    LOEWEIntegration of LightSpray technology into ongoing collaboration

    Bringing LightSpray technology into the collaboration with LOEWE, showcasing advanced performance technology at the high end of premium design.

    Risks & headwinds

    5
    Foreign Exchange HeadwindsQ1 FY26

    Americas reported growth of 3.1% vs 17.1% constant currency growth

    Mitigation: Company's strong gross profit allows absorption of external pressures.

    Geopolitical SituationQ1 FY26

    Discussed, not quantified

    Mitigation: Broad-based success and resilience of the EMEA region helped mitigate impact.

    Unpredictable Macroeconomic BackdropFY26

    Discussed, not quantified

    Mitigation: Company's confidence in its premium strategy and product innovation allows reiteration of guidance.

    Increased Promotional MarketOngoing

    Discussed, not quantified

    Mitigation: Company remains committed to its full-price strategy and disciplined growth.

    Tariff ImpactFY26

    20% incremental tariff rates from Vietnam assumed in guidance

    Mitigation: Strong gross profit allows absorption of additional impact from tariffs.

    What to watch in Q2 FY26

    5

    D2C Share Growth

    Next quarter and full year FY26
    Current38.7%
    TargetIncrease by 100-200 bps per year

    Why it matters

    D2C channel is a key driver of premium growth and margin expansion, and management expects it to outperform.

    We have been very consistent in saying that we want to increase D2C share by 100 to 200 basis points per year, and that also remains our expectation for the full year '26. Currently, we are at 38.7% in D2C share.

    Q&A highlights

    5

    Can you elaborate on the division of responsibilities between the two co-CEOs, Caspar and David, and highlight initiatives you've worked on previously?

    Caspar Coppetti stated the transition emphasizes continuity, with both co-CEOs driving strategic building blocks like retail expansion, apparel, and LightSpray. Frank Sluis (CFO) and Scott Maguire (President & COO) will report to both co-CEOs, ensuring alignment and execution of the strategy.

    “Look, this management transition is really in the spirit of continuity. So we've worked very closely for 13 years now. In the last year, we spent a lot of time together with Martin and the senior leadership team on developing the strategy that we're going to share with you in the Investor Day. And so nothing changes in how we approach the business, nothing changes in how we guide and nothing changes about the confidence that we have in the outlook.”

    asked by Aubrey Tianello · answered by Caspar Coppetti

    2 min read5 chapters

    Detailed Narrative

    01

    Innovation and Product Pipeline

    On continues to drive innovation with significant advancements like LightSpray technology, which saw its production capacity increase 30-fold with a new factory in Busan, South Korea. The LightSpray Cloudmonster Hyper sold out quickly, particularly in Asia Pacific and the U.S., with LightSpray representing nearly 20% of footwear net sales in the new Boston store. The company also introduced SURREAL SuperFoam, a lighter and more energetic material, set to debut with Cloudsurfer 3 in October and roll out across everyday running franchises in 2027. These innovations are central to On's strategy of offering differentiated, high-quality products.

    02

    Brand Momentum and Consumer Engagement

    The brand experienced strong momentum, with U.S. brand awareness crossing the 30% mark for the first time. Marketing efforts, including a campaign with Zendaya, generated over 20 million highly engaged views in the U.S. and contributed to a significant increase in the share of 18- to 24-year-olds in the DTC customer base. Partnerships, such as the LOEWE collaboration integrating LightSpray, further enhance premium positioning and cultural relevance, attracting new and younger audiences to the brand.

    03

    Channel and Geographic Expansion

    On's direct-to-consumer (DTC) channel led growth with a 28.7% constant currency increase, outpacing wholesale. The company's physical stores are performing well, with meaningful same-store growth in locations like Miami, Milan, and Tokyo. New store openings are planned for Stockholm, Sydney, San Francisco, and Sao Paulo, strategically expanding brand presence. Asia Pacific demonstrated exceptional growth of 61.4% constant currency, with Greater China performing above average and South Korea tripling net sales year-over-year, highlighting the success of controlled global expansion.

    04

    Leadership Transition and Strategic Continuity

    The quarter marked a leadership transition with Martin Hoffmann's departure as CEO and CFO, and the appointment of Frank Sluis as the new CFO. Founders Caspar Coppetti and David Allemann will now serve as co-CEOs, emphasizing continuity in strategy and values. The company plans to host an Investor Day in Zurich on September 21-22, 2026, to present its new 2030 vision and plan, reinforcing its long-term growth ambitions and commitment to its premium positioning.

    05

    Financial Discipline and Premium Strategy

    On's disciplined focus on premium execution resulted in a record gross profit margin of 64.2% and an adjusted EBITDA margin of 21%. The company attributes this to its full-price strategy, ASP strength (increasing from $145 to over $170), and operational efficiencies. Management stated that the 64.5% gross margin expected for the full year is a new baseline, allowing for continued reinvestment into product innovation and brand building while expanding profitability.

    AI-generated summary of the company’s earnings call. Not investment advice.