- On Holding AG posted a 32% year-over-year revenue increase in Q2 2025, exceeding expectations and raising full-year guidance.
- The company maintains strong margins and pricing power, driven by product innovation and sustainable footwear demand.
- Revenue has grown at a compound annual rate approaching 50% since 2021, underscoring rapid global expansion.
- Strategic initiatives, including eco-friendly materials, e-commerce growth, and athlete endorsements, have strengthened brand equity.
- Risks include currency headwinds, supply chain pressures, and fierce competition from established brands such as Adidas and Nike.
Investors in the athletic footwear sector have reason to take note as On Holding AG, the Swiss-based innovator in performance shoes, demonstrates remarkable resilience and growth amid a competitive landscape. With revenue expanding at a compound annual growth rate (CAGR) approaching 50% over the past four years, the company has solidified its position as an emerging force, challenging established giants through a blend of technological innovation and strategic market expansion.
Recent Earnings Momentum and Market Response
On Holding AG’s latest quarterly results underscore its upward trajectory. For the second quarter of 2025, the firm reported revenue of CHF 749.2 million, marking a 32% year-over-year increase—or 38.2% on a constant currency basis—surpassing analyst expectations of CHF 703.8 million. This performance propelled the stock to close at $51.23 on the NYSE, reflecting a 12% gain from the previous session’s close of $45.72, with trading volume reaching 5,124,942 shares, below the 10-day average but indicative of heightened interest.
The earnings per share (EPS) came in at a loss of CHF 0.09, missing estimates of CHF 0.14, yet the revenue beat and subsequent guidance uplift overshadowed this shortfall. Management raised its full-year 2025 revenue forecast to at least CHF 2.91 billion, implying growth of 31% or more on a constant currency basis, up from a prior outlook of 28%. Gross margins are now projected at 60.5% to 61.0%, signalling improved operational efficiency despite currency headwinds.
This surge aligns with broader trends in the premium athletic wear market, where consumers increasingly favour brands that combine functionality with sustainability. On Holding’s CloudTec cushioning technology has resonated particularly well in running and lifestyle segments, driving demand across Europe and Asia. The company’s ability to maintain pricing power—evident in its high-end footwear lines—has buffered it against inflationary pressures that have squeezed margins for peers.
Four-Year Revenue Growth: A Deeper Dive
Examining the four-year revenue CAGR nearing 50% reveals a compelling growth narrative. From 2021 to 2025, On Holding has transitioned from a niche player to a global contender. Historical data shows revenue climbing from CHF 724 million in 2021 to projections exceeding CHF 2.9 billion this year, fuelled by expansions into apparel and accessories alongside its core shoe business.
Key drivers include geographic diversification. The Americas, particularly the U.S., have become a powerhouse, contributing significantly to sales as the brand gains shelf space in specialty retailers and direct-to-consumer channels. In Asia-Pacific, partnerships with influencers and athletes have accelerated adoption, with second-quarter growth in the region outpacing overall figures.
Comparatively, industry benchmarks highlight On Holding’s outperformance. While legacy brands like Nike and Adidas have grappled with inventory gluts and shifting consumer preferences—Nike reported a 10% revenue drop in its fiscal first quarter ending August 2024—On has capitalised on demand for innovative, eco-friendly products. Analyst models, such as those from Nasdaq, forecast On’s EPS to reach $0.95 for the current year and $1.10 forward, yielding a forward P/E of 46.58, which, though elevated, reflects investor confidence in sustained expansion.
Strategic Initiatives Fuelling Expansion
On Holding’s growth is not merely organic; it stems from deliberate strategies. The firm’s investment in circular economy practices, including recyclable materials in its Cloudmonster and Cloudstratus lines, appeals to environmentally conscious millennials and Gen Z consumers. This has translated into robust direct sales, with e-commerce platforms showing double-digit growth rates.
Collaborations have also played a pivotal role. Endorsements from high-profile athletes, such as tennis stars, have enhanced brand visibility, particularly in premium segments. The company’s foray into tennis apparel and outdoor gear diversifies revenue streams, reducing reliance on running shoes alone.
From a valuation perspective, On Holding trades at a price-to-book ratio of 11.53, with a book value of $4.45 per share. Its market capitalisation stands at $16.7 billion, supported by 292.6 million shares outstanding. The stock’s 52-week range of $34.59 to $64.05 positions the current price of $51.23 nearer the midpoint, suggesting room for upside if growth targets are met. Analysts maintain a strong buy rating of 1.4, with sentiment from sources like Yahoo Finance indicating optimism around the raised guidance.
Challenges and Risk Considerations
Despite the positives, risks loom. Currency fluctuations, particularly the strong Swiss franc, have dented reported figures, as noted in the recent quarter. Supply chain disruptions in global manufacturing could impact production, though On’s agile model—leveraging Swiss engineering with Asian assembly—has mitigated some effects.
Competition remains fierce. Established players are rebounding; Adidas, for instance, reported record first-quarter sales in 2025, driven by celebrity-backed lines. On must continue innovating to defend its market share. Moreover, macroeconomic uncertainties, including potential recessions in key markets, could temper consumer spending on discretionary items like premium sneakers.
Forecasts from analyst-led models, such as those published on Investing.com, project revenue growth of 25-30% annually through 2027, assuming stable demand and margin expansion. However, these are contingent on execution; any miss could pressure the stock, which has shown volatility with a 52-week change of 1078.26%—a figure reflecting sharp swings.
Implications for Investors
For investors eyeing the consumer discretionary sector, On Holding exemplifies how innovation can drive outsized returns in a mature industry. The near-50% four-year CAGR not only highlights past success but also sets a high bar for future performance. With shares trading above the 50-day moving average of $52.53 but below the 200-day of $52.17, technical indicators suggest a consolidation phase, potentially offering entry points.
Broadly, the athletic footwear market is projected to grow at 5-7% annually through 2030, per industry reports, with premium segments expanding faster. On’s trajectory positions it to capture a larger slice, provided it navigates headwinds adeptly. Dry humour aside, in a world where even sneakers must run marathons to stay ahead, On Holding appears to have laced up effectively.
As of 12 August 2025, the data underscores a company in ascendance, rewarding those betting on its blend of Swiss precision and global ambition.
References
- CNBC. (2025, August 12). On Holding earnings Q2 2025. https://www.cnbc.com/2025/08/12/on-holding-onon-earnings-q2-2025.html
- Finance Yahoo. (n.d.). Q4 performance summary for On Holding. https://finance.yahoo.com/news/holding-ag-nyse-onon-q4-125635395.html
- Finance Yahoo. (n.d.). ONON stock page. https://finance.yahoo.com/quote/ONON/
- Investing.com. (2025). Analyst forecasts and models. https://investing.com/news/company-news/agi-q2-2025-slides-commercial-segment-growth-offsets-farm-challenges-4165989
- Investors on-running. (n.d.). Financials and filings. https://investors.on-running.com/financials-and-filings/default.aspx
- Investors on-running. (n.d.). Corporate homepage. https://investors.on-running.com/home/default.aspx
- MarketScreener. (2025). OVB Holding AG Q2 2025 results. https://www.marketscreener.com/news/ovb-holding-ag-reports-earnings-results-for-the-second-quarter-and-six-months-ended-june-30-2025-ce7c5edcd18cf325
- Nasdaq. (n.d.). ONON earnings data. https://www.nasdaq.com/market-activity/stocks/onon/earnings
- X (formerly Twitter) Accounts (2025). Market sentiment and earnings commentary: @App Economy Insights, @Earnings Whispers, @FashionUnitedUK, @fiscal_ai, @Wall St Engine
