On surged through its fourth quarter as the Zurich-based brand revealed on Tuesday that it beat analyst estimates and topped more than 3 billion Swiss francs ($3.8 billion) for the first time.
The company said that overall fourth quarter sales were up 22.6 percent at $952 million with Wall Street expecting 19.9 percent increase. The strong showing was boosted by a 20.8 percent jump in shoe sales at $878 million with apparel up 38.3 percent to $58 million.
“Surpassing the CHF 3 billion annual revenue milestone with record profitability is a profound validation of our vision to build the world’s most premium global sportswear brand,” David Allemann, On co-founder and executive co-chairman said in the report. “We are witnessing a fundamental societal shift, as people globally replace traditional markers of status with a commitment to health, longevity, and performance.”
On also revealed that direct-to-consumer sales in the fourth quarter were up 21.7 percent and wholesale saw a 23.4 percent rise. Globally, the brand’s reach continues to grow and the positive increases in regional markets last quarter.
Asia-Pacific sales climbed 70.8 percent to $162 million while Europe, the Middle East and Africa region rose 24.2 percent to $234 million and the Americas up 12.8 percent to $556 million.
On also boosted its retail presence last year with an additional 18 new store bringing its fleet to 70 globally.
“By charting our own course and executing with discipline against our strategic priorities, we have built a powerful financial engine that is driving record results,” On CEO and chief financial officer Martin Hoffmann said in the report. “The strength of our premium strategy allows us to exceed our high aspirations while providing the flexibility to reinvest in the high-return areas that we expect will fuel our growth for years to come. Our vision is proving itself at a new scale – from the exceptional productivity of our growing retail footprint to the compounding value of our multi-category expansion.”
Meanwhile, On said that full-year net sales are up 30 percent year-over-year and the company now holds $1.2 billion in cash.
The company has entered the final year of a three-year plan of scaling itself in the marketplace with significant investments in its LightSpray technology serving as a critical piece of the initiative.
Last week, On unveiled a new South Korean factory that will significantly increase its production of shoes with LightSpray, with the facility utilizing 32 robots that will increase output 30-fold. The first LightSpray outlet opened last year in Zurich, Switzerland with just four robots but the new factory is part of a rollout by on to deploy the technology in facilities around the world that meet its specifications.
“The opening of our second LightSpray factory is a monumental milestone for us in mastering this advanced manufacturing process,” On co-founder Caspar Coppetti said. “I want to sincerely congratulate the tremendous effort and dedication of the entire team who made this possible. LightSpray is a pinnacle example of how On continues to innovate through Swiss Engineering, dramatically changing the way we can create high-performance shoes with unmatched efficiency, sustainability and performance results.”
