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    On Holding (ONON)

    ONON Q4 2024: Guides 27% sales growth for FY25 after Cloud 6 success

    Reported on Jul 28, 2025 (Before Market Open)
    Pre-Earnings Price$47.85Last close (Mar 3, 2025)
    Post-Earnings Price$50.84Open (Mar 4, 2025)
    Price Change
    $2.99(+6.25%)
    • Strong Product Innovation: The re-launch of the Cloud 6, which is returning as a significant growth driver with early positive feedback and iconic status, underscores On’s ability to rejuvenate its core product lineup, supporting a bull case for continued revenue growth.
    • Robust Regional and Channel Growth: The Q&A highlighted expectations of Q1 growth in the low to mid-30s and continued strength in D2C and wholesale channels across key markets like Asia Pacific, Europe, and the US. This diversified, high-growth outlook supports a bullish view on On’s expansive market reach and revenue performance.
    • Expanding Apparel and Retail Presence: Breaking CHF 100 million in apparel sales for the first time and targeting an increase to 10% of revenue, coupled with strategic retail expansion initiatives, indicates a broadening revenue mix and margin improvement, further bolstering the bull case for On.
    • Operational and supply chain disruptions: The team noted challenges in H1, including issues from the Atlanta warehouse automation ramp-up and marketplace allocation shifts, which could lead to higher incremental costs and temporary inefficiencies.
    • Weakening U.S. consumer environment: There were concerns about a softer U.S. market post-holiday season, with uncertainty around consumer demand due to macroeconomic headwinds and potentially adverse weather effects, possibly impacting sales and margins.
    • Macro uncertainty impacting guidance: Executives emphasized prudence in their full-year guidance, pointing to macroeconomic uncertainties and headwinds that may slow growth and put pressure on profitability if adverse conditions persist.
    1. Guidance Outlook
      Q: What are full-year regional sales expectations?
      A: Management anticipates at least 27% constant currency growth for full year 2025 with sales reaching around CHF 2.94 billion, driven by strong performance in key markets such as the U.S. and Asia Pacific.

    2. Margin & Efficiency
      Q: How will efficiencies drive margin expansion?
      A: They plan to improve operating leverage with warehouse automation and tighter G&A controls, targeting adjusted EBITDA margins of 17–17.5% to support long-term growth.

    3. Operational Headwinds
      Q: What were the impacts of supply disruptions?
      A: Management noted challenges from European store closures and early warehouse transition costs, while expecting modest wholesale door growth from 10,700 to about 11,300 doors to help offset these issues.

    4. Apparel Growth
      Q: What is apparel strategy for revenue growth?
      A: Apparel sales have exceeded CHF 100 million, with plans to boost this category to around 10% of total revenue by streamlining collections and enhancing own retail and e-commerce efforts.

    5. Consumer Insights
      Q: How is young consumer engagement improving?
      A: Through focused product launches and marketing partnerships, On has seen a significant uptick in appeal among buyers under 35, reinforcing long-term brand loyalty.

    6. Competitive Landscape
      Q: How does competition affect future strategy?
      A: Management emphasized On’s differentiated, premium positioning and performance-driven innovations, which secure full-price sell-through and a strong margin profile against peers.

    7. Cloud 6 Strategy
      Q: What distinguishes Cloud 6 from Cloud 5?
      A: Cloud 6 is positioned as a renewed, iconic product aimed at younger consumers with refined segmentation, marking a notable evolution from the Cloud 5 launch.

    Research analysts covering On Holding.