On posts robust quarterly growth despite currency headwinds: The Swiss sportswear brand delivered double-digit sales gains across regions and channels in Q2 FY2025, with margins edging higher, but foreign-exchange losses pushed the company to a net loss.
The performance brand On remains on track for success and shifted into high gear in the second quarter. Sales jumped to 749.2 million Swiss francs (€778m) – an increase of 38.2 percent on a constant currency basis. The gross margin climbed to 61.5 percent, and the operating margin also increased. Direct sales and business in Asia-Pacific grew particularly strongly, driven by rapidly growing demand in China. The pace was also high in the first quarter, when sales were CHF 726.6 million (€754m) and the gross margin was 59.9 percent. However, while On posted a net profit of CHF 72.5 million (€75m) at the start of the year, a high foreign currency loss in the second quarter pushed the company into the red with CHF 40.9 million (€42.5m).
| On Holding - Income | |||
|---|---|---|---|
| 2025 | 2024 | Change | |
| Q2, ended June 30 (CHF million) | |||
| Net sales | 749.2 | 567.7 | 32.0% |
| Cost of sales | 288.4 | 227.4 | 26.8% |
| Gross profit | 460.8 | 340.2 | 35.4% |
| SG&A expenses | 368.0 | 292.9 | 25.6% |
| Operating result | 92.8 | 47.3 | 96.2% |
| Financial income | 7.5 | 5.8 | 29.3% |
| Financial expenses | 7.7 | 5.9 | 30.5% |
| Forex gain | -139.9 | -4.5 | -3008.9% |
| Pre-tax | -47.3 | 42.7 | – |
| Tax | -6.4 | 11.8 | – |
| Net income | -40.9 | 30.8 | – |
| Diluted EPS (Class A) | -0.12 | 0.09 | – |
| Diluted EPS (Class B) | -0.01 | 0.01 | – |
| H1, ended June 30 (CHF million) | |||
| Net sales | 1,475.8 | 1,075.9 | 37.2% |
| Cost of sales | 579.7 | 432.3 | 34.1% |
| Gross profit | 896.1 | 643.6 | 39.2% |
| SG&A expenses | 726.3 | 557.7 | 30.2% |
| Operating result | 169.8 | 85.8 | 97.9% |
| Financial income | 14.8 | 11.2 | 32.1% |
| Financial expenses | 13.6 | 10.8 | 25.9% |
| Forex gain | -154.4 | 72.3 | – |
| Pre-tax | 16.6 | 158.5 | -89.5% |
| Tax | 0.8 | 36.3 | -97.8% |
| Net income | 15.8 | 122.2 | -87.1% |
| Diluted EPS (Class A) | 0.05 | 0.37 | -86.5% |
| Diluted EPS (Class B) | – | 0.04 | – |
| Source: On Holding | |||
Asia and direct sales drive H1 growth
The growth drivers in the first half of the year are clear: On increased sales by almost 40 percent to CHF 1.48 billion (€1.54bn) – mainly thanks to strong growth in direct sales, which now accounts for a good 40 percent of total sales. The Asia-Pacific region also grew disproportionately, not least due to expansion in China. Although America remains the largest market, it grew more slowly than EMEA, which also saw double-digit growth. The gross margin after six months was 60.7 percent, with an adjusted Ebitda margin of a solid 17.4 percent.
“We are not growing through short-term trends, but by building a brand that will last for decades.”
David Allemann, co-founder and executive co-chairman
| On Holding - Revenues | |||||
|---|---|---|---|---|---|
| 2025 | 2024 | Change | Change (constant currencies) | ||
| Q2, ended June 30 (CHF million) | |||||
| Channels | |||||
| Wholesale | 441.0 | 358.2 | 23.1% | 28.8% | |
| DTC | 308.3 | 209.4 | 47.2% | 54.3% | |
| Net sales | 749.2 | 567.7 | 32.0% | 38.2% | |
| Regions | |||||
| Americas | 432.3 | 370.0 | 16.8% | 23.6% | |
| EMEA | 197.8 | 138.4 | 42.9% | 46.1% | |
| Asia-Pacific | 119.2 | 59.2 | 101.4% | 110.9% | |
| Net sales | 749.2 | 567.7 | 32.0% | 38.2% | |
| Products | |||||
| Shoes | 704.9 | 542.5 | 29.9% | 36.0% | |
| Apparel | 36.7 | 21.9 | 67.6% | 75.5% | |
| Accessories | 7.7 | 3.3 | 133.3% | 143.2% | |
| Net sales | 749.2 | 567.7 | 32.0% | 38.2% | |
| H1, ended June 30 (CHF million) | |||||
| Channels | |||||
| Wholesale | 890.6 | 675.9 | 31.8% | 33.4% | |
| DTC | 585.2 | 399.9 | 46.3% | 48.6% | |
| Net sales | 1,475.8 | 1,075.9 | 37.2% | 39.1% | |
| Regions | |||||
| Americas | 869.7 | 699.7 | 24.3% | 25.9% | |
| EMEA | 366.4 | 264.6 | 38.5% | 39.8% | |
| Asia-Pacific | 239.7 | 111.6 | 114.8% | 119.4% | |
| Net sales | 1,475.8 | 1,075.9 | 37.2% | 39.1% | |
| Products | |||||
| Shoes | 1,385.8 | 1,027.1 | 34.9% | 36.7% | |
| Apparel | 74.8 | 41.6 | 79.8% | 82.8% | |
| Accessories | 15.2 | 7.1 | 114.1% | 118.5% | |
| Net sales | 1475.8 | 1075.9 | 37.2% | 39.1% | |
| Source: On Holding | |||||
More than just shoes: small segments are growing rapidly
From running shoe specialist to broader sports equipment supplier: in the second quarter, On’s core business remained clearly focused on shoes, which accounted for around 94 percent of sales at CHF 704.9 million (€731m) and grew by 36 percent on a constant currency basis (YoY). The smaller segments grew significantly faster – apparel increased by 75.5 percent to CHF 36.7 million (€38.1m) and now accounts for around five percent of sales. Accessories more than doubled to CHF 7.7 million (€8.0m), although their share of sales is still only around one percent. Step by step, these categories are gaining in importance and underpinning On’s claim to position itself more broadly as a premium sports equipment supplier.
Tariff shock as an innovation accelerator
Another topic discussed during the earnings call was US tariff policy: On is facing significantly higher import tariffs on products from Southeast Asia. According to Chief Financial Officer and co-CEO Martin Hoffmann, the company currently pays around 20 percent on shoes from its manufacturing facilities in Vietnam and Indonesia. However, the rate will rise to 40 percent for imports from Vietnam and 39 percent from Indonesia. Hoffmann emphasizes that as a premium and rapidly growing brand, On has “multiple opportunities to compensate for these impacts.”
This effect was already evident in the margin increases in the second quarter. On attributes this to several measures, some of which were already initiated in the first half of the year: In the US, price increases have been implemented on selected models since July to cushion the impact of new tariffs and underscore the brand’s premium positioning. In addition, the company achieved efficiency gains in production and sales, which had a positive impact on the gross margin. The new LightSpray production facility in Zurich is making a further contribution: the largely automated manufacturing process enables faster and more local shoe production with significantly fewer staff – an important lever for reducing costs, shortening delivery times, and responding more flexibly to market changes.
Tailwind for the second half of the year
The premium sports equipment manufacturer is entering the second half of the year with a tailwind. “The brand has incredible momentum all around the world,” Hoffmann pointed out in the earnings call. July was once again the strongest month in the brand’s history – “from an absolute numbers perspective.” The order books are full. For the coming months, the company aims to achieve “grow in a durable way” and prioritize “high-quality growth.” Analysts are also celebrating the record quarter. They reacted enthusiastically to the strong results in the Q&A session. There were congratulations such as “outstanding result today,” a clear signal of the remarkable performance. Current market analyses also continue to rate On positively: Raymond James, among others, highlights the growth prospects and emphasizes the exceptional sales momentum in the second quarter. The bar for the second half of the year is therefore set high.
