Swiss sneaker company On raises guidance again, says it won't offer Black Friday deal

Swiss sportswear company On significantly raised its full-year guidance for the third consecutive quarter after reporting Q3 results that surpassed analyst expectations, with EPS of 43 cents and revenue of 794 million francs. The company now forecasts fiscal 2025 sales of 2.98 billion francs, representing 34% constant currency growth, a notable outperformance given the broader slowdown impacting competitors like Nike and Hoka. This success is attributed to On's premium, innovation-driven strategy and commitment to full-price sales, even during the holiday season, leading to a premarket share jump of over 20% and underscoring its effective market differentiation.

Analysis

On Holding (ONON) reported robust Q3 2025 results, significantly exceeding Wall Street expectations with adjusted EPS of 43 cents versus 25 cents anticipated, and revenue of 794 million francs against a 763 million franc forecast. This strong performance led to the company raising its full-year fiscal 2025 sales guidance for the third consecutive quarter to 2.98 billion francs, implying 34% constant currency growth, surpassing prior forecasts and analyst consensus. The company's net income also saw substantial year-over-year growth, reaching 118.9 million francs from 30.5 million francs.

On's success is attributed to its premium, innovation-driven strategy, emphasizing full-price sales and the intersection of performance and design, which resonates strongly with consumers. This approach contrasts sharply with competitors like Nike (NKE) and Hoka (DECK), which are facing sales declines or trimmed guidance amidst a broader slowdown in discretionary spending. On's commitment to maintaining full-price sales through the holiday season, even as the industry leans on discounts, underscores its luxury-like positioning and strong brand equity.

The company's continuous innovation, exemplified by its LightSpray technology used in the record-breaking Cloudboom Strike LS, allows it to capture market share from legacy brands. This technological edge and differentiated strategy have resulted in strong financial outcomes and a highly positive market reaction, with ONON shares jumping over 20% in premarket trading following the announcement. The sustained outperformance highlights On's effective execution in a challenging market.

Key Decisions for Investors

• Investors should consider On's consistent outperformance, premium positioning, and innovation-led growth in a challenging market, which suggests continued momentum and warrants a closer look at its long-term growth potential.
• Monitor the competitive landscape and market share shifts, observing how competitors like Nike and Hoka adapt to On's disruptive strategy and whether the broader sportswear market slowdown impacts On's future growth trajectory.
• Assess valuation given On's premium strategy and high growth, evaluating whether current market pricing fully reflects its sustainable competitive advantages and execution risks.