On Holding AG (ONON) Stock Analysis and Metrics

On Holding AG

NYSE: ONON

$30.91 ▼ -7.87 (-20.29%)

At close: Aug 11, 2026 · 4:00 PM UTC

Financial Ratios

Add ratio to table…

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 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 Holding AG is positioned to capitalize on a structural shift in consumer behavior where athletic identity has evolved into lifestyle expression, a trend the company is actively cultivating through products like Cloudtilt and strategic partnerships with Zendaya and LOEWE. This approach is expanding On's total addressable market beyond traditional running into the broader 'movement class'—consumers who view sportswear as a core component of personal identity and cultural affiliation. The Q1 data showing an 18- to 24-year-old demographic becoming the fastest-growing segment in DTC channels, coupled with Cloudtilt becoming the #1 sneaker at Foot Locker in Europe, validates that On is successfully penetrating high-growth, high-margin lifestyle segments without diluting its premium positioning. Unlike competitors who rely on discount-driven volume, On is attracting younger consumers through design-led innovation and authenticity, enabling sustainable ASP growth and deeper category expansion into apparel and accessories. This represents a multi-year runway for margin-accretive growth that is not yet fully reflected in current valuation multiples, as the market continues to view On primarily as a running shoe company rather than a lifestyle-as-performance brand with expanding cultural relevance.
The commercial scalability of LightSpray technology presents a transformative, underappreciated catalyst that could redefine On's manufacturing economics and product differentiation over the next 24–36 months. While management discussed LightSpray's early success—such as representing 20% of footwear sales in the new Boston store and selling hundreds of pairs daily in DTC channels—they did not emphasize the broader implications of achieving 30-fold production capacity increases at the Busan facility. This scale-up transforms LightSpray from a niche innovation into a viable mass-production platform capable of delivering unprecedented speed-to-market, reduced labor dependency, and enhanced customization—all critical advantages in an era of volatile supply chains and rising tariffs. The technology's ability to produce a finished shoe from filament to asphalt in minutes reduces lead times and inventory risk, while its potential integration into future collaborations (e.g., with LOEWE) positions On at the forefront of premium, on-demand manufacturing. Unlike incremental material improvements, LightSpray represents a paradigm shift in how athletic footwear is conceived and produced, offering On a defensible moat that competitors cannot easily replicate due to the proprietary nature of the process and the significant capital investment required.
On's disciplined reinvestment of efficiency gains into upper-funnel brand building—evidenced by increased marketing spend behind Zendaya, LightSpray activations, and apparel-led retail merchandising—is creating a self-reinforcing flywheel that is underpriced by the market. The company reported that digital and physical traffic continues to outstrip revenue growth, indicating strong unconverted demand that is being captured through brand-building investments rather than price cuts. This strategy is yielding measurable results: overall U.S. awareness surpassed 30% for the first time, and the Zendaya campaign generated over 20 million highly engaged views in the U.S. alone. By reinvesting operational leverage into demand generation instead of margin compression, On is strengthening its pricing power and customer loyalty while simultaneously improving conversion rates in owned channels. The market tends to view rising marketing expenses as a drag on profitability, but in On's case, these investments are directly tied to expanding the premium market and increasing customer lifetime value—particularly among younger, lifestyle-oriented demographics. This approach ensures that growth remains both premium and sustainable, with the potential to drive long-term margin expansion as brand equity scales.

On Holding AG is positioned to capitalize on a structural shift in consumer behavior where athletic identity has evolved into lifestyle expression, a trend the company is actively cultivating through products like Cloudtilt and strategic partnerships with Zendaya and LOEWE. This approach is expanding On's total addressable market beyond traditional running into the broader 'movement class'—consumers who view sportswear as a core component of personal identity and cultural affiliation. The Q1 data showing an 18- to 24-year-old demographic becoming the fastest-growing segment in DTC channels, coupled with Cloudtilt becoming the #1 sneaker at Foot Locker in Europe, validates that On is successfully penetrating high-growth, high-margin lifestyle segments without diluting its premium positioning. Unlike competitors who rely on discount-driven volume, On is attracting younger consumers through design-led innovation and authenticity, enabling sustainable ASP growth and deeper category expansion into apparel and accessories. This represents a multi-year runway for margin-accretive growth that is not yet fully reflected in current valuation multiples, as the market continues to view On primarily as a running shoe company rather than a lifestyle-as-performance brand with expanding cultural relevance.
The commercial scalability of LightSpray technology presents a transformative, underappreciated catalyst that could redefine On's manufacturing economics and product differentiation over the next 24–36 months. While management discussed LightSpray's early success—such as representing 20% of footwear sales in the new Boston store and selling hundreds of pairs daily in DTC channels—they did not emphasize the broader implications of achieving 30-fold production capacity increases at the Busan facility. This scale-up transforms LightSpray from a niche innovation into a viable mass-production platform capable of delivering unprecedented speed-to-market, reduced labor dependency, and enhanced customization—all critical advantages in an era of volatile supply chains and rising tariffs. The technology's ability to produce a finished shoe from filament to asphalt in minutes reduces lead times and inventory risk, while its potential integration into future collaborations (e.g., with LOEWE) positions On at the forefront of premium, on-demand manufacturing. Unlike incremental material improvements, LightSpray represents a paradigm shift in how athletic footwear is conceived and produced, offering On a defensible moat that competitors cannot easily replicate due to the proprietary nature of the process and the significant capital investment required.
On's disciplined reinvestment of efficiency gains into upper-funnel brand building—evidenced by increased marketing spend behind Zendaya, LightSpray activations, and apparel-led retail merchandising—is creating a self-reinforcing flywheel that is underpriced by the market. The company reported that digital and physical traffic continues to outstrip revenue growth, indicating strong unconverted demand that is being captured through brand-building investments rather than price cuts. This strategy is yielding measurable results: overall U.S. awareness surpassed 30% for the first time, and the Zendaya campaign generated over 20 million highly engaged views in the U.S. alone. By reinvesting operational leverage into demand generation instead of margin compression, On is strengthening its pricing power and customer loyalty while simultaneously improving conversion rates in owned channels. The market tends to view rising marketing expenses as a drag on profitability, but in On's case, these investments are directly tied to expanding the premium market and increasing customer lifetime value—particularly among younger, lifestyle-oriented demographics. This approach ensures that growth remains both premium and sustainable, with the potential to drive long-term margin expansion as brand equity scales.

▼ Bear case

On Holding AG faces significant margin pressure from escalating global trade tensions, particularly the 20% incremental tariff assumptions embedded in its 2026 guidance, which management acknowledged would directly impact gross profitability despite their confidence in maintaining a 64.5% full-year gross margin target. While the company cited supply chain efficiencies and full-price discipline as offsetting factors, the reliance on these levers assumes continued success in shifting production away from high-tariff jurisdictions like Vietnam—a transition that may not be fully achievable given the complexity of relocating specialized manufacturing processes such as LightSpray or SuperFoam integration. Furthermore, the gross margin expansion observed in Q1 (up 4.3 percentage points to 64.2%) was driven in part by one-time benefits from prior-year supply chain initiatives and FX tailwinds lapping freight accruals, which are unlikely to repeat at the same magnitude. The market may be underestimating the persistence of macroeconomic headwinds, including elevated input costs and currency volatility, which could erode the gains from operational efficiency if consumer demand softens and forces promotional activity—contradicting On's premium pricing strategy.
The company's aggressive expansion into lifestyle and apparel segments, while promising, carries execution risks that are not being adequately priced in by investors, particularly regarding brand dilution and channel conflict. On's strategy of targeting younger consumers through collaborations like Zendaya and Cloudtilt Remix risks alienating its core running audience if perceived as prioritizing fashion over performance—a concern subtly highlighted when management noted the need to balance 'performance and style cues' in brand tracker data. Additionally, the rapid DTC share growth (now at 38.7%) and plans to increase it by 100–200 basis points annually could strain relationships with key wholesale partners like Foot Locker and JD Sports, especially as On expands its own retail footprint in premium locations such as Stockholm, Sao Paulo, and San Francisco. While management emphasized that they remain in only ~50% of wholesale doors, the trend toward vertical integration increases the likelihood of channel conflict as On competes directly with its partners for the same consumer. This dynamic could lead to reduced wholesale order visibility or less favorable terms, undermining a historically stable and profitable growth lever.
On's guidance for 2026 constant currency net sales growth of at least 23% may be overly optimistic given the lapping of strong prior-year comparisons and the cyclical nature of discretionary spending in premium sportswear, particularly as the company laps the post-pandemic demand surge that fueled much of its recent expansion. Although management cited strong order books and early feedback on upcoming products like SURREAL and Cloudrunner Max, they acknowledged a deliberate slowdown in wholesale growth to allow for inventory normalization ahead of a 'firework of innovation' in early 2027—suggesting that the full-year guidance already factors in a wholesale drag. The reliance on DTC to carry the growth burden assumes continued strength in consumer traffic conversion, yet the company admitted that traffic continues to outstrip sales, indicating potential friction in the purchasing journey—whether due to website experience, product availability, or pricing sensitivity. If the expected acceleration in DTC does not materialize, or if apparel fails to sustain its current triple-digit growth trajectory, the overall growth rate could fall short of guidance, especially in a macroeconomic environment where consumers are increasingly scrutinizing discretionary purchases.

On Holding AG faces significant margin pressure from escalating global trade tensions, particularly the 20% incremental tariff assumptions embedded in its 2026 guidance, which management acknowledged would directly impact gross profitability despite their confidence in maintaining a 64.5% full-year gross margin target. While the company cited supply chain efficiencies and full-price discipline as offsetting factors, the reliance on these levers assumes continued success in shifting production away from high-tariff jurisdictions like Vietnam—a transition that may not be fully achievable given the complexity of relocating specialized manufacturing processes such as LightSpray or SuperFoam integration. Furthermore, the gross margin expansion observed in Q1 (up 4.3 percentage points to 64.2%) was driven in part by one-time benefits from prior-year supply chain initiatives and FX tailwinds lapping freight accruals, which are unlikely to repeat at the same magnitude. The market may be underestimating the persistence of macroeconomic headwinds, including elevated input costs and currency volatility, which could erode the gains from operational efficiency if consumer demand softens and forces promotional activity—contradicting On's premium pricing strategy.
The company's aggressive expansion into lifestyle and apparel segments, while promising, carries execution risks that are not being adequately priced in by investors, particularly regarding brand dilution and channel conflict. On's strategy of targeting younger consumers through collaborations like Zendaya and Cloudtilt Remix risks alienating its core running audience if perceived as prioritizing fashion over performance—a concern subtly highlighted when management noted the need to balance 'performance and style cues' in brand tracker data. Additionally, the rapid DTC share growth (now at 38.7%) and plans to increase it by 100–200 basis points annually could strain relationships with key wholesale partners like Foot Locker and JD Sports, especially as On expands its own retail footprint in premium locations such as Stockholm, Sao Paulo, and San Francisco. While management emphasized that they remain in only ~50% of wholesale doors, the trend toward vertical integration increases the likelihood of channel conflict as On competes directly with its partners for the same consumer. This dynamic could lead to reduced wholesale order visibility or less favorable terms, undermining a historically stable and profitable growth lever.
On's guidance for 2026 constant currency net sales growth of at least 23% may be overly optimistic given the lapping of strong prior-year comparisons and the cyclical nature of discretionary spending in premium sportswear, particularly as the company laps the post-pandemic demand surge that fueled much of its recent expansion. Although management cited strong order books and early feedback on upcoming products like SURREAL and Cloudrunner Max, they acknowledged a deliberate slowdown in wholesale growth to allow for inventory normalization ahead of a 'firework of innovation' in early 2027—suggesting that the full-year guidance already factors in a wholesale drag. The reliance on DTC to carry the growth burden assumes continued strength in consumer traffic conversion, yet the company admitted that traffic continues to outstrip sales, indicating potential friction in the purchasing journey—whether due to website experience, product availability, or pricing sensitivity. If the expected acceleration in DTC does not materialize, or if apparel fails to sustain its current triple-digit growth trajectory, the overall growth rate could fall short of guidance, especially in a macroeconomic environment where consumers are increasingly scrutinizing discretionary purchases.

Research Tools

Datasets

Plans

Developers

About

Investment Thesis

Geographical areas [axis] Breakdown of Revenue (2025)

Products and services [axis] Breakdown of Revenue (2025)

Research Tools

Datasets

Plans

Developers

About

Investment Thesis

Geographical areas [axis] Breakdown of Revenue (2025)

Products and services [axis] Breakdown of Revenue (2025)

Create an account

Sign In

Reset Password