The running market is hot—and it's driving sales of Roger Federer-backed On shoes

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Swiss-based, New York-listed running shoe business On is on an upward sprint.  

Its signature cratered shoes have become a favorite of runners worldwide, even though it’s been around for fewer years than some of its peers. The timing couldn’t be better as more people have turned to running as their chosen form of exercise since the COVID-19 pandemic—a trend that On is cashing in on.

The company, backed by tennis icon Roger Federer, reported a 29% jump in year-over-year first-quarter sales in constant currency terms worth 508 million Swiss francs ($560 million) on Tuesday, surpassing the half-a-billion mark for the first time. 

Its direct-to-consumer sales, which reach shoppers directly through On’s website and app, saw a 49% net sales increase during the same period—a significant jump for the sportswear company. 

“This serves as a validation of the strong demand we have experienced across all channels, regions and product categories,” said On’s co-CEO and CFO Martin Hoffman. 

The Swiss company raised its annual sales forecast after beating analyst estimates in the first quarter, benefiting from foreign currency swings. The U.S., On’s biggest market by sales, performed significantly better than other regions, and its shares in New York are up by 35% since the start of 2024. 

On’s growth compares well with other sportswear companies. Nike, for instance, has kicked off a $2 billion cost-savings plan for the next three years in the face of softer consumer demand, while retailer Foot Locker has had to push back its growth plan until the market improves.

‘On’ward and upward

Since its inception in 2010, On has become a superstar in the crowded sports shoe industry. Its shoes stand out because of the “pods” on the shoe platform designed to absorb impact with each step. The Zurich-based company has also carved its niche among fashion-loving luxury consumers willing to splurge more on high-quality shoes.  

On’s shoes, which lean on science and innovative design, rapidly became a hit with exercise enthusiasts—especially runners—driving it to profitability within four years of launch.

The pandemic marked a turning point, with the company going public in August 2021, valued at over $11 billion. In the year following its listing, it defied the rest of its industry by clocking a net sales increase of 70% compared to 2020 amid shrinking sales in the broader sports market.

A shining example of On’s success was when Hellen Obiri won the Boston Marathon twice wearing its shoes. 

The Swiss brand has launched a slew of new products, such as Cloudmonster 2 and Cloudspark, and plans to expand in the DTC space to reach more of its shoppers. It’s also eyeing the Olympics this summer to build brand awareness among the world’s top athletes.

“It’s really the first Olympics where we can go big,” Hoffmann told Bloomberg. “And it’s close to our home, so we can have our full presence available to bring to the games.”

We’ll have to wait and see whether On’s dream run continues.

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