On Holding AG Earnings Overview
On Holding AG, a prominent name in the sportswear industry, has announced its robust financial results for the fourth quarter and full year of 2024, easily surpassing its previous financial outlook. The company reported net sales of CHF 2,318.3 million, marking a remarkable 29.4% growth from the previous year. Notably, this growth rate increases to 33.2% when considering constant currency factors. Alongside these impressive sales figures, On Holding concluded the year with a lucrative net income of CHF 242.3 million and achieved a stellar gross profit margin of 60.6%. Furthermore, the company closed the year with a robust cash balance nearing CHF 1 billion.
On Holding AG Results
The table below displays key financial metrics for On Holding AG, elucidating year-over-year growth and showcasing comparisons for both quarterly and annual periods:
| Metric | FY 2024 | FY 2023 | YoY Change | Q4 2024 | Q4 2023 | QoQ Change |
|---|---|---|---|---|---|---|
| Net Sales (CHF million) | 2,318.3 | 1,791.6 | +29.4% | 606.6 | 447.1 | +35.7% |
| Gross Profit (CHF million) | 1,405.7 | 1,067.2 | +31.7% | 376.8 | 270.2 | +39.5% |
| Net Income (CHF million) | 242.3 | 79.6 | +204.5% | 89.5 | (26.8) | +434.6% |
| EPS Basic (CHF) | 0.75 | 0.25 | +200.0% | 0.28 | (0.08) | +450.0% |
| Adjusted EBITDA (CHF million) | 387.6 | 276.9 | +40.0% | 99.4 | 71.9 | +38.3% |
These metrics underscore On Holding’s significant financial growth, particularly highlighted by its substantial increase in net income and earnings per share (EPS). The adjusted EBITDA margin also amplified, signifying improved operational efficiency.
Revenue Breakdown
The company's revenue streamed primarily from two channels: Direct-to-Consumer (DTC) and Wholesale. The table below delineates the revenue performance across these channels:
| Channel | FY 2024 Revenue (CHF million) | YoY Change | Q4 2024 Revenue (CHF million) | QoQ Change |
|---|---|---|---|---|
| DTC Sales | 942.8 | +40.3% | 296.2 | +43.4% |
| Wholesale Sales | 1,375.5 | +22.8% | 310.4 | +29.1% |
Analysis of Segment Performance
The notable expansion in DTC sales, which account for 48.8% of net sales in Q4, demonstrates On’s strategic emphasis on enhancing its customer engagement directly via its online platform and branded stores globally. This approach not only fuels higher revenue growth but also contributes to enhanced margins through higher price control and reduced dependency on third-party distributors. Wholesale sales, albeit growing at a slightly slower pace, continue to reinforce On’s presence in the global marketplace.
Key Developments
On Holding AG has achieved several pivotal milestones within 2024:
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Launch of LightSpray™ Technology : The introduction of this innovative technology reflects On’s commitment to fostering cutting-edge product features, thereby enhancing its market competitiveness.
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Global Retail Expansion : The company broadened its retail footprint to nearly 50 stores worldwide, emphasizing global brand visibility and customer accessibility.
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Apparel Sales Expansion : Surpassing CHF 100 million in apparel net sales accentuates the diversified product portfolio furthers On’s market reach.
These undertakings signal On's dedication to broadening its strategic initiatives, enhancing operational efficiencies, and capturing new market segments.
Executive Commentary
David Allemann, Co-Founder and Executive Co-Chairman of On, highlights that, “Our partnerships with icons like Roger Federer, Zendaya, and FKA twigs have propelled On to become a beloved brand, igniting a passion for On that transcends borders and cultures.” These collaborations play a critical role in fortifying brand prestige and widespread consumer engagement.
Meanwhile, Martin Hoffmann, Co-CEO and CFO, expressed, “Exceeding CHF 2.3 billion in net sales and reaching a cash position close to CHF 1 billion are not just milestones but testaments to On's continued strong momentum.” His insights affirm On’s sustained financial and operational vigor.
Stock Projections
Considering the robust financial performance, strategic initiatives, and current market dynamics, On Holding AG's stock is poised for a promising outlook:
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High Projection : With the anticipation of sustained growth and strategic product launches, the stock could potentially reach new highs, reflecting a continued investor confidence in the company's trajectory.
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Low Projection : Despite the company’s robust performance, potential macroeconomic headwinds and market volatility could exert downward pressure, warranting a cautious approach.
In conclusion, On Holding AG’s remarkable 2024 performance, bolstered by innovation, expanded market footprint, and strategic brand partnerships, positions it to capture future growth opportunities and further enhance its brand stature in the competitive landscape.
