On Holding Delivers 22% Growth as Leadership Tightens Wholesale to Protect Premium Position
The Swiss sportswear brand reported strong Q2 results while deliberately managing wholesale inventory to maintain full-price integrity, signaling a sustained focus on margin over volume.
Premium Growth at Scale
On Holding AG reported net sales of CHF 850 million for the second quarter of 2026, representing 22% growth at constant currency, while maintaining what Co-CEO David Allemann described as "industry-leading profitability" with gross profit margins exceeding 65% and adjusted EBITDA margins near 20% (earnings call, 2026-08-11).
The Swiss athletic footwear and apparel maker, now valued at approximately $13 billion, demonstrated particularly strong momentum in its direct-to-consumer channel, which grew 34% at constant currency during the quarter. Brand awareness reached 30% globally as the company attracted what it characterized as "a whole new generation of fans" (earnings call, 2026-08-11).
Wholesale Discipline Signals Strategic Shift
The quarter's results revealed a deliberate recalibration in On's wholesale strategy. While the company's owned channels exceeded expectations across all regions, wholesale performance lagged, particularly in the Americas, where "the sellout of some of our everyday running franchises tracked below our ambitions in a highly promotional multi-brand marketplace," Allemann acknowledged (earnings call, 2026-08-11).
Rather than chase volume, On opted to manage sell-in carefully and avoid building channel inventory that could "compromise our full price integrity." Allemann framed the decision as consistent with earlier moves, citing the company's choice years ago to "prune over distributed channels in EMEA," which he said now delivers "exceptional 21% constant currency growth and record Q2 group margins" (earnings call, 2026-08-11).
Innovation Engine Accelerates
On used the quarter to showcase technological advances across its product portfolio. At its inaugural Run Fun Meet in Paris in June, the company previewed the Cloudboom Strike 2 marathon racing shoe, which an independent study found delivers "a 1.6% improvement in running economy over the industry's leading super shoes" (earnings call, 2026-08-11).
The company's LightSpray robotic manufacturing technology, with facilities in Busan and Zurich now operational, drove immediate sellouts for the Cloudmonster 3 Hyperlite spray launched in March. On also introduced "real phone technology" combining impact absorption with rebound in its Cloudserver line, which Allemann called "the first for On" (earnings call, 2026-08-11).
Category Expansion Gains Traction
Tennis emerged as On's fastest-growing apparel vertical, with sales "nearly tripling this quarter" following visibility at Roland Garros (earnings call, 2026-08-11). The training category grew 40%, while the Cloud field franchise within premium sneaker channels posted 10% year-over-year growth, with Cloudtilt models taking three of the top five selling positions at Foot Locker Europe.
Apparel reached a record 28% share of running campaign net sales in Q2, supported by the company's proprietary fabric technologies and expanded women's offerings.
Outlook and Leadership
On expects full-year net sales growth "in the low 20s at constant currency with a higher gross margin outlook and reiterated adjusted EBITDA margin," positioning itself to close 2026 as "the fastest-growing global brand with the highest gross margin in our industry," according to Allemann (earnings call, 2026-08-11).
The company announced organizational changes including the promotion of Rebecca Kaye to Chief Global Markets Officer and the appointment of Alice Delahan as Chief Customer Officer. CFO Frank Sluis joined the call for his first earnings presentation, bringing "over 2 decades of global consumer finance leadership" (earnings call, 2026-08-11).
On plans to host an Investor Day on September 21-22 in Zurich, its first long-term roadmap update in three years.
This article was generated by MarginX from the earnings call on 2026-08-11. It is not investment advice.