On Running Achieves Luxury-Level Margins at 62.8% as Sales Hit $3.8 Billion

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5.18.2026

Quick Facts

On Running achieved 62.8% gross margins in 2025, matching luxury brand levels while posting $3.8 billion in sales
Co-founders David Allemann and Caspar Coppetti return as co-CEOs after 13-year CEO Martin Hoffmann steps down
Despite strong financials, On’s sales fell nearly 20% at independent run specialty retailers in 2025

Swiss running brand On Running posted gross margins that rival luxury companies in 2025, achieving 62.8% while growing net sales 30% to CHF 3.01 billion ($3.8 billion). The performance puts On’s margins in territory typically occupied by high-end fashion brands rather than athletic footwear companies.

Operating profit jumped 78.2% during 2025, capping a remarkable financial run for the Zurich-based company. On’s margins compare favorably to luxury benchmarks – Hermes generates 70% gross margins, while personal luxury goods average 18-19% EBIT margins in 2024.

The strong performance comes as On undergoes a leadership transition. Co-founders David Allemann and Caspar Coppetti will serve as co-CEOs following Martin Hoffmann’s decision to step down after 13 years as CEO.

“The best time to elevate your game is when you are already breaking your own records,” Allemann said. “By unifying founder-led strategic intent with our operational core, we aim to move faster, stay relentlessly focused on product heat, and continue pushing the boundaries of what a sportswear brand can be.”

On’s footwear sales drove the growth, increasing 33.6% in Q4 2024 to CHF 568.8 million ($639.9 million). The company credited success of its Cloudsurfer models for the performance gains.

However, challenges remain in key retail channels. On’s sales fell nearly 20% year-over-year at independent run specialty stores in 2025, according to Karnan Associates data. Models like the Cloudsurfer 2 and Cloudboom Max struggled to meet expectations in this critical channel.

The stock performance reflects market concerns despite strong financials. Shares remain down more than 30% year-to-date and have declined roughly 40% from their January 2025 all-time high of $64.04. On revised its 2026 growth outlook downward in March, contributing to investor uncertainty.

Celebrity partnerships with Zendaya and FKA twigs helped elevate On’s cultural profile, according to company executives. The brand holds an estimated 2% of the global athletic footwear market as of 2024, positioning it for a potential $20 billion market cap.