ONON · On Holding AG

On Holding AG delivered record first-quarter 2026 financial results, marked by exceptional top-line growth, margin expansion, and raised profitability guidance — all achieved amid significant external headwinds including U.S. tariffs and macroeconomic uncertainty. Net sales rose 14.5% YoY to CHF 831.9 million, the first time surpassing CHF 800 million quarterly, with constant-currency growth of 26.4% underscoring underlying demand strength. Gross margin expanded sharply by 430 basis points to 64.2%, reflecting disciplined full-price execution, favorable FX impact, and operational improvements — notably reduced air freight — which more than offset the 20% incremental U.S. tariff on Vietnam-sourced products. The company explicitly embedded this tariff cost into its raised full-year gross margin guidance of at least 64.5%, confirming resilience in premium economics. Geographically, Asia-Pacific led growth at 44.4% YoY (61.4% constant currency), now accounting for over 20% of global net sales, driven by China, South Korea, and Japan; apparel grew 45.1% YoY, signaling successful category expansion beyond footwear. Management reiterates confidence in long-term growth pillars — DTC, APAC, and apparel — and raises adjusted EBITDA margin guidance to 19.5–20.0%, balancing continued investment in high-return growth areas with margin accretion. Notably, the functional currency change to USD for key entities reduced P&L FX volatility but increased OCI volatility due to translation into CHF presentation currency — a structural shift with ongoing accounting implications. The filing also discloses CHF 55 million in paid IEEPA tariffs, with refunds pending but deemed not highly probable, reinforcing conservative treatment of potential recoveries. Collectively, these results validate On’s premium strategy, operational rigor, and scalability — positioning it strongly for sustained, profitable growth despite persistent geopolitical and trade policy uncertainty.