On Holding AG Q1 FY2025 earnings call

• Strong brand momentum with campaigns like Zendaya and product launches such as Cloud 6, driving high demand. • Product innovations including LightSpray technology, with plans for global scalability. • Regional performance: Europe, Middle East, Africa saw growth across channels; Americas had strong performance with key retail partners; Asia Pacific continued rapid growth. • Leadership changes: Marc's transition to advisory role, Martin stepping into Co-CEO, and Helena Helmerson's election to the Board. • Operational efforts: Focus on elevating processes and capabilities across touch points, with investments in tech for customer experience and operational efficiencies.

Net sales for Q1 2025 reached CHF726.6 million, growing 43% year-over-year on a reported basis and 40% on a constant currency basis. The D2C channel had net sales of CHF276.9 million, growing 45.3% year-over-year on a reported basis and 42.4% on a constant currency basis, with a D2C share of 38.1% in Q1 2025. Wholesale grew by 41.5% year-over-year to CHF449.7 million. By region: Europe, Middle East, Africa grew by 33.6% on a reported basis to CHF168.6 million; Americas net sales grew by 32.7% to CHF437.4 million; Asia Pacific net sales grew by 130.1% to CHF120.6 million. By product category: Shoes net sales grew by 40.5% to CHF680.9 million; Apparel net sales reached CHF38.1 million, increasing by 93.1% year-on-year.

• Increased constant currency growth outlook for 2025 to at least 28%, with reported net sales projected to reach at least CHF2.8 billion. • Gross profit margin outlook in the range of 60% to 60.5% for the full year. • Adjusted EBITDA margin outlook in the range of 16.5% to 17.5%. • Product pipeline for Q2 and beyond includes running products like Cloudsurfer Max, Cloudflo 5, and newness in tennis and training verticals.

• Potential incremental tariffs in the United States introducing uncertainty into planning. • Volatile foreign exchange rates with key operating currencies depreciating relative to the Swiss Franc.

Q: Jonathan Komp asked about brand awareness across regions and drivers of growth in the Americas.

A: Caspar Coppetti and Martin Hoffmann responded on brand campaigns driving demand globally and strong performance in the US with retail stores and key partners.

Q: Aneesha Sherman inquired about mitigation efforts for tariffs and pricing strategy.

A: Caspar Coppetti stated focus on brand premium positioning and planned price increases in the US.

Q: Jay Sole asked about apparel success and wholesale impact.

A: Caspar Coppetti discussed apparel pillars (running, training/movements, tennis) and wholesale learning curve.

Q: Aubrey Tianello asked about store rollout performance.

A: Caspar Coppetti talked about successful store performance and progress towards 10% revenue share from stores.

Q: Anna Andreeva asked about Cloud 6 demo and Q1/Q2 momentum.

A: Martin Hoffmann and Caspar Coppetti discussed Cloud 6 launch success and continued strong demand.

Q: Tom Nikic asked about wholesale order book.

A: Martin Hoffmann stated no cautious ordering patterns observed.

Q: Christina Fernandez asked about wholesale door growth outlook.

A: Martin Hoffmann said door growth outlook remains mid-single digits with controlled expansion.

Q: John Kernan asked about automation projects and LightSpray scalability.

A: Caspar Coppetti and Martin Hoffmann discussed LightSpray progress and automation project in Atlanta warehouse.