On Holding Jumps 7.6% on $1 Billion Buyback and 2029 Targets

On Holding AG Ltd. (NYSE:ONON) closed up 7.58 percent at $29.39 per share on Tuesday after announcing a $1 billion share buyback program to run over the next three years.

The company unveiled the repurchase plan at its Investor Day, saying it reflects a strong balance sheet and forms part of an initiative to return higher value to shareholders. The buyback will involve Class A ordinary shares only.

What did On Holding commit to through 2029?

Encouraged by solid earnings growth in recent quarters, the company raised its long-term outlook. On Holding now targets:

• Net sales growth in the high teens on a constant currency basis through 2029
• Absolute net sales of at least CHF 5.6 billion, roughly $7 billion at current exchange rates
• A gross profit margin of 65 percent
• An adjusted EBITDA margin of 22 percent

What are the goals for this year?

On Holding reaffirmed its full-year 2026 guidance: net sales growth in the low 20 percent range on a constant currency basis, a gross profit margin of 65 percent, and an adjusted EBITDA margin between 19.5 percent and 20 percent.

The figures exclude an expected $65 million in tariff refunds, which the company targets to receive in the third quarter of the year.

What did management say?

Founder and co-CEO Caspar Coppetti struck a confident tone. "We are on track to significantly overachieve our targets given at the last Investor Day in 2023. For the period through 2029, we are committing to premium as our north star, staying focused on the long term, and executing on each turn of the On Premium Playbook," he said.

"It is simple in principle, demanding in practice, and powerful because it compounds: Top-line expansion and margin expansion are not in conflict at On; they are complementary outputs of our Premium Playbook," Coppetti added.

How strong was the latest quarter?

The second quarter showed a sharp swing into profitability. On Holding posted net income of CHF 105 million, up from a net loss of CHF 40.9 million in the same period last year.

Net sales rose 13.5 percent to CHF 850.3 million from CHF 749.2 million year-on-year. The direct-to-consumer channel grew 26 percent, while sales from the apparel segment jumped 47.7 percent.

Are institutional investors on board?

The second quarter also signaled growing bullish conviction among institutional investors. Committed capital from hedge funds and other institutions in On Holding jumped 64 percent over the period.

With a $1 billion buyback now in motion and 2029 targets set well above its 2023 Investor Day commitments, On Holding has tied its valuation story to simultaneous top-line and margin expansion through the end of the decade.