On Holding AG (ONON) Stock Analysis and Metrics

Sector: Consumer Cyclical Industry: Footwear & Accessories CIK: 0001858985

Market Cap 11.84 Bn

P/E 5.67

P/S 3.26

Div. Yield 0.00

ROIC (Qtr) 0.02

Total Debt (Qtr) 74.07 Mn

Revenue Growth (1y) (Qtr) 31.45

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About

On Holding AG designs, develops, and markets premium sportswear products including footwear, apparel, and accessories. The company was founded in 2010 and incorporated as On Holding AG in Switzerland in 2012. Its mission is to ignite the human spirit through movement, a principle that guides product development and brand storytelling. On Holding AG is headquartered in Zurich, Switzerland and maintains a global presence across the Americas, EMEA, and Asia Pacific regions. The brand distributes its products through wholesale partnerships and a direct...

On Holding AG designs, develops, and markets premium sportswear products including footwear, apparel, and accessories. The company was founded in 2010 and incorporated as On Holding AG in Switzerland in 2012. Its mission is to ignite the human spirit through movement, a principle that guides product development and brand storytelling. On Holding AG is headquartered in Zurich, Switzerland and maintains a global presence across the Americas, EMEA, and Asia Pacific regions. The brand distributes its products through wholesale partnerships and a direct to consumer channel that includes owned retail stores and an online platform. As of December 31, 2025, the company operated 67 retail locations worldwide, with 38 of those situated in China.

Revenue is generated primarily from the sale of shoes, apparel, and accessories to customers through wholesale partners and the company's own retail and online platform. In fiscal year 2025, net sales reached CHF 3,014.0 million, reflecting year over year growth of 30.0 percent compared with 2024. The wholesale channel contributed 58.2 percent of net sales in 2025 while the direct to consumer channel accounted for 41.8 percent. By product group, shoes represented the largest share with CHF 2,804.4 million, followed by apparel at CHF 169.9 million and accessories at CHF 39.6 million in 2025. Revenue is diversified geographically, with the Americas generating 57.7 percent of total net sales, EMEA contributing 25.3 percent, and Asia Pacific providing 17.0 percent in 2025.

On Holding AG organizes its operations into three product based segments: Shoes, Apparel, and Accessories. These segments are defined by the type of product offered and share common functions such as design, development, and marketing.

• The Shoes segment focuses on the design, development, and sale of innovative footwear for running, outdoor, training, and tennis activities. It incorporates proprietary technologies such as CloudTec, CloudTec Phase, Helion superfoam, Speedboard, and LightSpray to deliver distinct performance benefits. Products are validated through testing with elite athletes and are offered across performance and all day categories.

• The Apparel segment designs, develops, and sells performance oriented apparel for running, outdoor, training, tennis, and everyday wear. It applies Swiss design principles and uses sustainable materials such as recycled polyester, polyamide, synthetic leather, and organic cotton. The segment supports the brand’s goal of offering head to toe looks across its product range.

• The Accessories segment offers complementary products such as socks, hats, bags, and other gear that support the brand’s sportswear offering. These items are designed with the same focus on quality, design, and sustainability as the core footwear and apparel lines. Accessories are sold through both wholesale and direct to consumer channels to enhance the overall customer experience.

On Holding AG occupies a growing position in the global sportswear market as a premium brand recognized for technical innovation and design. The company competes with established sportswear leaders such as Nike, adidas, Under Armour, Brooks, Hoka, ASICS, New Balance, lululemon, Alo, Patagonia, Arc’teryx, Anta, and Li Ning. Its competitive advantages stem from a strong focus on athlete validated technologies like CloudTec and LightSpray, which differentiate its products in performance categories. On Holding AG also benefits from a clear sustainability agenda that incorporates recycled and renewable materials into its footwear, apparel, and accessories. The balanced wholesale and direct to consumer distribution model enables the brand to reach broad audiences while maintaining control over brand presentation and customer experience.

On Holding AG serves individual consumers, athletes, and active individuals who purchase its products for sports, fitness, and everyday wear. The company’s wholesale partners include sporting goods stores, outdoor retailers, lifestyle boutiques, and luxury department stores that resell its products to end users. Direct to consumer customers shop through owned retail locations and the global online platform, accessing the full product range in a branded environment. Geographically, the customer base spans the Americas, EMEA, and Asia Pacific regions, with notable store concentrations in cities such as Austin, Miami, Palo Alto, Washington D. C., Berlin, London, Shanghai, and Tokyo. In China, the company operates 38 retail locations across key cities including Hong Kong, serving a growing base of urban consumers seeking premium sportswear.

Investment thesis

Bull case

On's recent results demonstrate that the company has exceeded its own 3‑year growth targets, posting a 33% constant currency net sales increase in 2024. The brand has successfully leveraged its premium positioning to command higher price points, reflected in a 60.6% gross profit margin that exceeds the 60% midpoint of its strategic goal. This margin strength indicates that the company can absorb modest cost inflation while still delivering attractive profitability to shareholders. Furthermore, the expansion of its direct‑to‑consumer channel has already translated into a record 48.8% share of sales, reducing reliance on wholesale partners and improving margin quality.
The company has effectively broadened its product mix beyond running shoes to include tennis, training and apparel, with apparel sales surpassing CHF 100 million for the first time. This diversification offers a dual benefit: it taps into the high‑margin head‑to‑toe apparel market and mitigates the cyclical volatility of the footwear segment. The strategy is underpinned by strong retail evidence; in high‑end flagship stores the apparel mix exceeds 20% of transactions, indicating robust consumer acceptance of the full‑line proposition. As the company scales its online commerce engine, it will be able to further cross‑sell apparel to its established sneaker customer base, amplifying incremental revenue.
On has secured a series of high‑profile brand ambassadors that resonate with younger audiences, such as Zendaya and FKA twigs, while maintaining long‑term ties to Roger Federer. These collaborations create cultural relevance that extends beyond sports, positioning the brand at the intersection of performance and lifestyle. The effect is visible in a doubling of Gen‑Z awareness in the United States, which is a demographic known for high brand loyalty and willingness to pay premium prices. This cultural cachet is a significant intangible that is not fully captured in financial statements but enhances future growth prospects.
The company’s strategic retail rollout has proven to be a powerful halo effect in key markets. The introduction of flagship stores in Paris, Milan, and Chicago has directly correlated with increased online traffic and sales volume, demonstrating a strong omnichannel synergy. Additionally, the company’s entry into emerging markets through both owned and franchised stores—such as Santiago de Chile and Jakarta—provides early mover advantage in regions with rising disposable income. This geographic diversification will cushion the business against localized economic downturns.
On’s investment in a fully automated warehouse in Atlanta is a forward‑looking catalyst that will reduce fulfillment lead times and lower per‑unit logistics costs as volume scales. While the transition period may impose short‑term costs, the long‑term savings are projected to free up capital for marketing and product innovation. Automation also enhances order accuracy, improving customer satisfaction and repeat purchase rates. The strategic focus on operational excellence aligns with the company’s overall margin expansion plan, targeting an adjusted EBITDA margin of 17%–17.5% in 2025.

On's recent results demonstrate that the company has exceeded its own 3‑year growth targets, posting a 33% constant currency net sales increase in 2024. The brand has successfully leveraged its premium positioning to command higher price points, reflected in a 60.6% gross profit margin that exceeds the 60% midpoint of its strategic goal. This margin strength indicates that the company can absorb modest cost inflation while still delivering attractive profitability to shareholders. Furthermore, the expansion of its direct‑to‑consumer channel has already translated into a record 48.8% share of sales, reducing reliance on wholesale partners and improving margin quality.
The company has effectively broadened its product mix beyond running shoes to include tennis, training and apparel, with apparel sales surpassing CHF 100 million for the first time. This diversification offers a dual benefit: it taps into the high‑margin head‑to‑toe apparel market and mitigates the cyclical volatility of the footwear segment. The strategy is underpinned by strong retail evidence; in high‑end flagship stores the apparel mix exceeds 20% of transactions, indicating robust consumer acceptance of the full‑line proposition. As the company scales its online commerce engine, it will be able to further cross‑sell apparel to its established sneaker customer base, amplifying incremental revenue.
On has secured a series of high‑profile brand ambassadors that resonate with younger audiences, such as Zendaya and FKA twigs, while maintaining long‑term ties to Roger Federer. These collaborations create cultural relevance that extends beyond sports, positioning the brand at the intersection of performance and lifestyle. The effect is visible in a doubling of Gen‑Z awareness in the United States, which is a demographic known for high brand loyalty and willingness to pay premium prices. This cultural cachet is a significant intangible that is not fully captured in financial statements but enhances future growth prospects.
The company’s strategic retail rollout has proven to be a powerful halo effect in key markets. The introduction of flagship stores in Paris, Milan, and Chicago has directly correlated with increased online traffic and sales volume, demonstrating a strong omnichannel synergy. Additionally, the company’s entry into emerging markets through both owned and franchised stores—such as Santiago de Chile and Jakarta—provides early mover advantage in regions with rising disposable income. This geographic diversification will cushion the business against localized economic downturns.
On’s investment in a fully automated warehouse in Atlanta is a forward‑looking catalyst that will reduce fulfillment lead times and lower per‑unit logistics costs as volume scales. While the transition period may impose short‑term costs, the long‑term savings are projected to free up capital for marketing and product innovation. Automation also enhances order accuracy, improving customer satisfaction and repeat purchase rates. The strategic focus on operational excellence aligns with the company’s overall margin expansion plan, targeting an adjusted EBITDA margin of 17%–17.5% in 2025.

Bear case

The company’s reliance on a high‑price premium model introduces significant pricing risk, especially in a consumer environment where discretionary spending is volatile. As economic conditions tighten, even affluent consumers may shorten their discretionary budgets, forcing the brand to confront a potential price elasticity that could erode margins. The management’s emphasis on premium positioning may not translate into sustained sales growth if competitors introduce lower‑priced alternatives with comparable performance. This pricing vulnerability is not fully reflected in the current valuation and warrants caution.
On’s operational execution faces notable supply chain challenges that were highlighted in the Q&A, particularly disruptions in North America and delayed automation at its Atlanta warehouse. These operational hiccups have already impacted delivery timelines and potentially diluted the brand’s promised customer experience. While management expressed optimism about resolving these issues, the associated costs and reputational damage could persist longer than anticipated, reducing net operating income. The risk of repeated supply chain disruptions remains elevated given the company’s rapid expansion into new markets.
The expansion of the retail footprint, while a strategic growth driver, introduces significant capital expenditures and operational complexity. The company has increased its retail space to over 10,000 square meters, a move that requires sustained capital outlay for lease, construction, and store operations. If the incremental sales volume does not match expectations, the return on investment could be lower than projected, putting pressure on profitability. Moreover, the retail model is inherently sensitive to macroeconomic swings and changes in consumer shopping behavior.
The company’s heavy marketing spend—currently around 11%–12% of sales—exerts downward pressure on net income. While upper‑funnel investment is critical for brand building, the diminishing marginal returns on marketing spend could result in an over‑exposure to advertising costs relative to incremental revenue. This is especially concerning in a saturated sportswear market where competitive spend is also increasing. Management’s commitment to maintaining high marketing spend may limit flexibility in adjusting to market dynamics.
On’s focus on high‑margin product categories such as Cloud and Light Spray leaves it vulnerable to shifts in consumer preferences. If running shoes or lightweight training footwear lose favor to newer innovations from competitors, the company could experience a loss of market share in its core segments. The brand’s heavy dependence on these categories means that a slowdown in demand could disproportionately affect top line growth. Diversifying the product mix further is a strategic priority, but the execution of such a shift carries inherent risk.

The company’s reliance on a high‑price premium model introduces significant pricing risk, especially in a consumer environment where discretionary spending is volatile. As economic conditions tighten, even affluent consumers may shorten their discretionary budgets, forcing the brand to confront a potential price elasticity that could erode margins. The management’s emphasis on premium positioning may not translate into sustained sales growth if competitors introduce lower‑priced alternatives with comparable performance. This pricing vulnerability is not fully reflected in the current valuation and warrants caution.
On’s operational execution faces notable supply chain challenges that were highlighted in the Q&A, particularly disruptions in North America and delayed automation at its Atlanta warehouse. These operational hiccups have already impacted delivery timelines and potentially diluted the brand’s promised customer experience. While management expressed optimism about resolving these issues, the associated costs and reputational damage could persist longer than anticipated, reducing net operating income. The risk of repeated supply chain disruptions remains elevated given the company’s rapid expansion into new markets.
The expansion of the retail footprint, while a strategic growth driver, introduces significant capital expenditures and operational complexity. The company has increased its retail space to over 10,000 square meters, a move that requires sustained capital outlay for lease, construction, and store operations. If the incremental sales volume does not match expectations, the return on investment could be lower than projected, putting pressure on profitability. Moreover, the retail model is inherently sensitive to macroeconomic swings and changes in consumer shopping behavior.
The company’s heavy marketing spend—currently around 11%–12% of sales—exerts downward pressure on net income. While upper‑funnel investment is critical for brand building, the diminishing marginal returns on marketing spend could result in an over‑exposure to advertising costs relative to incremental revenue. This is especially concerning in a saturated sportswear market where competitive spend is also increasing. Management’s commitment to maintaining high marketing spend may limit flexibility in adjusting to market dynamics.
On’s focus on high‑margin product categories such as Cloud and Light Spray leaves it vulnerable to shifts in consumer preferences. If running shoes or lightweight training footwear lose favor to newer innovations from competitors, the company could experience a loss of market share in its core segments. The brand’s heavy dependence on these categories means that a slowdown in demand could disproportionately affect top line growth. Diversifying the product mix further is a strategic priority, but the execution of such a shift carries inherent risk.

Geographical areas [axis] Breakdown of Revenue (2025)

Peer comparison

Companies in the Footwear & Accessories

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	NKE	NIKE, Inc.	65.29 Bn	28.85	1.40	7.03 Bn
2	DECK	Deckers Outdoor Corp	14.13 Bn	13.81	2.63	-
3	ONON	On Holding AG	11.84 Bn	5.67	3.26	0.07 Bn
4	CROX	Crocs, Inc.	5.16 Bn	-69.30	1.28	1.34 Bn
5	SHOO	Steven Madden, Ltd.	2.88 Bn	37.84	1.10	0.29 Bn
6	WWW	Wolverine World Wide Inc /De/	1.76 Bn	13.27	0.94	0.55 Bn
7	WEYS	Weyco Group Inc	0.33 Bn	14.20	1.19	-
8	DBI	Designer Brands Inc.	0.32 Bn	-35.83	0.11	0.01 Bn

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On Holding AG (NYSE: ONON)

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Investment thesis

Bull case

Bear case

Geographical areas [axis] Breakdown of Revenue (2025)

Peer comparison

Research Tools

Developers

On Holding AG (NYSE: ONON)

About

Investment thesis

Bull case

Bear case

Geographical areas [axis] Breakdown of Revenue (2025)

Peer comparison

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