AINEWS
On bets the next running-shoe moat is sole geometry, not foam
After a record CHF 3.01B FY2025, Swiss running brand On opened its Zurich lab to press. The pitch: midsole chemistry is now a commodity.
After a record CHF 3.01B FY2025, Swiss running brand On opened its Zurich lab to press. The pitch: midsole chemistry is now a commodity.
On co-founder Caspar Coppetti told assembled press at the brand's Zurich innovation lab that "foam alone is no longer differentiation." The lab, opened to external journalists for the first time in 2026 and presented by the company as a brand-maturity step, is the response: a manufacturing platform built around midsole geometry and reprogrammable cells placed close to the consumer, not around a new midsole compound.
The bet is being made from a position of strength. On posted CHF 3.01 billion in FY2025 net sales, up 30% on a reported basis and 35.6% at constant currency, with a record 62.8% gross margin. Q1 2026 net sales reached CHF 831.9 million, up 43% year over year, with net profit up more than 80% and a 64.2% gross margin, luxury-tier profitability for a sports brand. Asia-Pacific revenue grew 96.4% on the year, clearing CHF 5 billion for the first time and now accounting for over a fifth of global sales.
That financial breakout is the backdrop for the personnel move. Co-founders David Allemann and Caspar Coppetti resumed co-CEO roles in May and June 2026, replacing Martin Hoffmann after roughly five years. The founder return is the evidence the company can afford the bet, not the story.
The story is the lab. The On Labs walkthrough paired Coppetti's quote with two pieces of operating evidence. The first was LightSpray, a robotic upper-application cell the company has been scaling, presented as the kind of flexible near-shore production that lets new upper shapes ship without a full Asian production-line commitment. The second was an acoustic chamber designed to test how a sole rebounds against a hard floor, not just how soft it feels underfoot, signaling that the design loop now starts from structural and acoustic data rather than a hand-feel brief. Any brand with a foam-compounding budget can now match On's midsole chemistry within a season. A reprogrammable cell placed near the consumer is harder to copy.
Hoka, the Deckers Outdoor-owned rival that built its brand on a maximalist foam stack, has seen its run-category growth slow from 24% to low double digits while around 80% of its revenue remains concentrated in running shoes. The cushioning arms race that powered Hoka's last decade is the same race that just produced On's midsole-chemistry ceiling. On's new "Movement Class" positioning, a deliberate expansion from competitive runners to lifestyle exercisers, is the demand-side answer to the same pressure, and the bet that running-shoe demand can broaden into a wider lifestyle pool without losing the performance premium.
China is the cleanest data point on that demand. On ranked in the top five in Tmall's Double 11 footwear rankings in the above-CHF-140 price band, saw store traffic double during Chinese New Year, and reports apparel mix above 20% at its Shenzhen MIXC flagship. Asia-Pacific is now the testing ground for whether a brand built around sole geometry and lifestyle expansion can compound at a luxury-margin structure, and the CHF 5 billion-and-rising regional run is the bet's first results page.
The next running-shoe cycle will be settled by sole geometry, by the speed at which new shapes can be retooled, and by whether the Chinese consumer keeps voting at luxury prices. The numbers behind that bet, and the Hoka comparison, are still mostly On-narrated; the proof arrives in the next earnings cycle.