Swiss sneaker maker’s guidance disappoints

Swiss sneaker maker On Holding said Tuesday it expects its sales growth to slow more than expected this year, leading shares to fall 14% in premarket trading.

The Cloudmonster maker expects 2026 net sales to grow by at least 23% in constant currencies, implying at least 3.44 billion Swiss francs ($4.38 billion) at current spot rates. While that would be a faster pace of growth than most of its competitors, it represents a slowdown from the 35.6% constant currency growth it saw in fiscal 2025 and was below analyst consensus of about 3.7 billion francs.

In an interview with CNBC, co-founder and executive chair David Allemann said the company is taking a “strategic” approach to its growth in 2026 and its guidance is based on the “incredible demand” it expects to see in the key Americas market.

“We don’t want to build a brand just for the next years,” said Allemann. “We’re building a brand for the next decade and so we’re strategic in how we penetrate channels, wholesale, how many stores we roll out, being strategic [on] which franchises that we push and where we probably also hold back a little bit. So that’s a very strategic premium play.”

During On’s holiday quarter, the company also saw mixed results. The company’s footwear revenue and sales in its wholesale channel and Europe, Middle East and Africa geography all came in higher than expected, as did its margins, according to StreetAccount. During the quarter, On’s gross margin was 63.9%, higher than expectations of 62.5%, while its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) margin grew to 17.6%, far ahead of expectations of 15.9%, according to StreetAccount.

Sales in certain categories and geographies, however, performed worse than expected. Apparel and accessories sales both came in lower than estimates, along with revenue in its direct channel and key Americas and Asia-Pacific geographies.

Across the business, On beat expectations on the top and bottom lines. Here’s how the fast growing sneaker brand performed compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

• Earnings per share: 25 cents adjusted vs. 20 cents expected
• Revenue: 743.8 million francs vs. 723.5 million francs expected

On’s net income for the three-month period that ended Dec. 31 was 69.1 million francs, or 21 cents per share, compared with 89.5 million francs, or 28 cents per share, a year earlier. 

Sales rose to 743.8 million francs, up 22.6% from 606.6 million francs a year earlier.

On is now in the third and final year of its strategy to double sales to 3.55 billion francs and increase EBITDA margin to at least 18% by 2026 in a quest to be “the most premium global…