The following discussion on our operating and financial review and prospects should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included within this Annual Report (see “Item 18. Financial Statements”). This discussion and analysis and other parts of this Annual Report contain forward-looking statements that reflect our plans, strategy, estimates and current expectations that involve risks and uncertainties. Our actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of several factors that could cause or contribute to these differences including, but not limited to those discussed below and elsewhere in this Annual Report, particularly in the sections titled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements.” The audited consolidated financial statements as of December 31, 2025, and 2024 and for the fiscal years ended December 31, 2025, 2024 and 2023 were prepared in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board, and presented in Swiss Francs (CHF). For a comparative discussion and analysis related to the results of operations and changes in financial condition for fiscal years 2024 compared to 2023 refer to “Operating and Financial Review and Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2024, filed on March 4, 2025, with the SEC and available at www.sec.gov. A. Operating Results Overview On is a premium performance sportswear brand rooted in innovation, design, and sustainability. Since our founding in the Swiss Alps in 2010, we have built a distinctive global brand with a passionate community across more than 90 countries. Through our premium product and brand experience, we bring our mission—to ignite the human spirit through movement—to life for our fans worldwide. We believe our premium positioning and our relentless focus on performance and design sets us apart within the global sportswear market. Our culture of innovation has enabled us to repeatedly introduce groundbreaking technologies designed to elevate the running experience and create enduring excitement around our brand. Anchored in our running heritage, we have extended this expertise into other performance categories, including performance outdoor, performance all-day, performance tennis, and performance training, connecting us with new communities across a full spectrum of movement. On operates as a single-brand consumer products business and therefore has a single operating and reportable segment. In 2025, we continued to advance the long-term vision we first articulated at our 2023 Investor Day: to be the most premium global sportswear brand. Our journey towards this is built on three strategic growth pillars, each underpinned by foundational capabilities designed to scale our brand, deepen consumer engagement, and drive sustainable growth. (see “Item 4 — Information on the Company — Business Overview”). By executing successfully against these pillars, On delivered strong results in 2025. Net sales increased by 30.0% to CHF 3,014.0 million compared to 2024. This momentum was driven by organic growth, fueled by strong consumer demand for our brand across sales channels, product categories, and geographic regions, and amplified by our strategic expansion into new products and markets. We continued to expand our wholesale channel globally, partnering with some of the most reputable general sporting, specialty running, outdoor, fashion and lifestyle retailers to bring On to even more consumers. In 2025, we continued to scale and deepen our collaboration with global key accounts, including Dick's Sporting Goods, JD Sports and Foot Locker. The wholesale channel accounted for 58.2% of net sales in 2025. Table of Contents With our community and brand awareness growing globally, we continued to scale our global e-commerce platform and grew our own-retail presence, opening new stores across all regions and in key cities like Madrid, Washington DC, Palo Alto, and Seoul. Our DTC channel as a whole, which includes our e-commerce sites and store revenue, represented 41.8% of net sales in 2025. As of December 31, 2025, our global footprint consists of 67 retail locations, including 14 retail stores in the Americas, 10 retail stores in Europe and 5 in Asia Pacific (excluding China). We also operate 38 locations in China, including Hong Kong. In China, our stores are a mix of smaller format mall-based stores and standalone retail stores. Innovation is core to our brand. In 2025, we advanced our pioneering LightSpray technology, a process set to redefine the running experience and reimagine manufacturing. We introduced a portfolio of cutting-edge products, powered by our suite of proprietary technologies including CloudTec, CloudTec Phase, Helion superfoam, and Speedboard. The growth and diversification of our product assortment was a significant driver of our net sales increase in 2025. This growth was led by iconic franchises, including performance running favorites like the Cloudsurfer and Cloudmonster; popular all-day styles like the Cloudtilt and the Cloud; and our Roger franchise in performance tennis. The expansion of our apparel and accessories collections brought new fans to the brand and further underscored our evolution from a footwear pioneer into a true "toe-to-head" sportswear brand. Key Financial Metrics Key financial metrics for fiscal year 2025 compared to fiscal year 2024 included: •net sales increased by 30.0% to CHF 3,014.0 million, or by 35.6% on a constant currency basis; •net sales through the DTC sales channel increased by 33.7% to CHF 1,260.5 million, or by 39.9% on a constant currency basis; •net sales through the wholesale sales channel increased by 27.5% to CHF 1,753.4 million, or by 32.6% on a constant currency basis; •net sales in Europe, Middle East and Africa (“EMEA”), Americas and Asia-Pacific ("APAC") increased by 32.0% to CHF 762.7 million, 17.6% to CHF 1,740.1 million and 96.4% to CHF 511.1 million, respectively; •net sales in EMEA, Americas and APAC increased by 34.7%, 23.4% and 106.7% on a constant currency basis, respectively; •net sales from shoes, apparel and accessories increased by 27.5% to CHF 2,804.4 million, 68.2% to CHF 169.9 million and 124.1% to CHF 39.6 million, respectively; •net sales from shoes, apparel and accessories increased by 32.9%, 75.5% and 135.1% on a constant currency basis, respectively; •gross profit increased by 34.7% to CHF 1,893.6 million from CHF 1,405.7 million; •gross profit margin increased to 62.8% from 60.6%; •net income decreased by 15.9% to CHF 203.7 million from CHF 242.3 million; •net income margin decreased to 6.8% from 10.4%; •basic earnings per share (“EPS”) Class A (CHF) decreased to 0.62 from 0.75; •diluted EPS Class A (CHF) decreased to 0.61 from 0.74; •adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") increased by 46.3% to CHF 567.0 million from CHF 387.6 million; •adjusted EBITDA margin increased to 18.8% from 16.7%; •adjusted net income decreased to CHF 266.4 million from CHF 317.4 million; •adjusted basic EPS Class A (CHF) decreased to 0.81 from 0.98; and Table of Contents •adjusted diluted EPS Class A (CHF) decreased to 0.80 from 0.97. Key highlights as of December 31, 2025 compared to December 31, 2024 included: •cash and cash equivalents increased by 10.3% to CHF 1,019.9 million from CHF 924.3 million; and •net working capital increased by 14.3% to CHF 570.3 million from CHF 498.9 million. Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS, net working capital and net sales on a constant currency basis are non-IFRS measures used by us to evaluate our performance. Furthermore, we believe these non-IFRS measures enhance investors' understanding of our financial and operating performance from period to period because they enhance the comparability of results between each period, help identify trends in operating results and provide additional insight and transparency on how management evaluates the business. Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS, net working capital and net sales on a constant currency basis should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with IFRS. For a detailed description and a reconciliation to the nearest IFRS measure, see section titled “Non-IFRS Measures.” Summary of Financial Performance The following table summarizes certain key operating measures derived from audited financial statements for the fiscal years ended December 31, 2025, 2024 and 2023, and derived from unaudited financial statements for the three-month periods ended December 31, 2025 and 2024. See “—Results of Operations” for additional details and for the comparison discussions between the years ended December 31, 2025 and 2024 (audited) and the three-month periods ended December 31, 2025 and 2024 (unaudited). Table of Contents Fiscal year ended December 31, Three-month period ended December 31, (CHF in millions) 2025 2024 2023 2025 2024 Net sales 3,014.0 2,318.3 1,792.1 743.8 606.6 Gross profit 1,893.6 1,405.7 1,067.2 475.3 376.8 Operating result 377.0 211.6 180.2 82.5 53.1 Net income 203.7 242.3 79.6 69.1 89.5 Net income margin 6.8 % 10.4 % 4.4 % 9.3 % 14.8 % Basic EPS Class A (CHF) 0.62 0.75 0.25 0.21 0.28 Diluted EPS Class A (CHF) 0.61 0.74 0.25 0.21 0.27 Other data(1) Adjusted EBITDA 567.0 387.6 276.9 131.0 99.4 Adjusted EBITDA margin 18.8 % 16.7 % 15.5 % 17.6 % 16.4 % Adjusted net income 266.4 317.4 112.4 83.5 107.7 Adjusted basic EPS Class A (CHF) 0.81 0.98 0.35 0.25 0.33 Adjusted diluted EPS Class A (CHF) 0.80 0.97 0.35 0.25 0.33 (1) Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, and adjusted diluted EPS are non-IFRS measures. See section titled “Non-IFRS Measures” for a description of these measures and a reconciliation to the nearest IFRS measure. Components of our Results of Operations Net Sales Net sales are derived from selling On's premium performance products including shoes, apparel and accessories. Net sales within the wholesale sales channel are recognized at the point in time at which control of the goods has been transferred from On to the customer, which is typically when goods have been shipped or delivered to the customer’s specified location. Net sales within the wholesale sales channel are sales, net of an estimated provision for sales returns, discounts, and volume rebates. Net sales within the DTC sales channel are recognized when control of the goods has been transferred from On to the customer, primarily upon delivery for e-commerce customers or at the point the customer purchases the goods at the retail store. Payment of the transaction price is due immediately when the customer purchases the goods. Net sales within the DTC sales channel are sales, net of an estimated provision for sales returns. Table of Contents Cost of Sales We outsource substantially all of the manufacturing of our products. Therefore, cost of sales primarily consists of the cost of purchases of finished goods, the majority of which are sourced in USD. Other cost of sales relate to personnel expenses in connection with sourcing materials and quality control, depreciation charges for production tools and equipment, royalty expenses, in-bound freight expenses, custom duty and non-refundable taxes incurred in delivering the goods to distribution centers managed by third parties, and inventory provision expenses. Gross Profit Gross profit is net sales less cost of sales. Gross profit margin measures gross profit as a percentage of net sales. Selling, General and Administrative Expenses Our Selling, General and Administrative (“SG&A") expenses generally consist of selling, marketing, distribution, general and administrative expenses, and share-based compensation. Selling expenses support our customer relationships and relate to selling our products to wholesale partners, and end customers through our e-commerce platform and our owned retail stores. These expenses primarily include personnel expenses for sales representatives, sales commissions, payment processing fees in the DTC sales channel, and depreciation expenses primarily related to our retail store right-of-use assets and leasehold improvements. Selling expenses are generally correlated to net sales. Distribution expenses primarily relate to leasing and third-party expenses for warehousing inventories, and transportation costs associated with delivering products from distribution centers to wholesale partners, end customers and retail stores. Distribution expenses are generally correlated to net sales. Marketing expenses consist primarily of advertising and marketing promotions (both offline and digital campaigns) of our products, as well as trade show and event costs, sponsorship costs, consulting and contractor expenses, marketing-related travel, product display expenses and overhead costs. We intend to continue to invest in our marketing capabilities in the future and expect this expense to increase in absolute dollars in future periods as we release new products and expand internationally. Marketing expense as a percentage of total net sales may fluctuate from period to period based on total net sales and the timing of our investments in marketing functions as these investments may vary in scope and scale over future periods. General and administrative expenses represent costs incurred in our corporate offices, primarily related to personnel costs, including salaries, variable incentive compensation, benefits, other professional service costs, including SaaS ("software as a service") costs, depreciation, and amortization related to our offices and infrastructure. We have invested considerably in this area to support the growing volume and complexity of the business and anticipate continuing to do so in the future. Share-based compensation costs represent expenses for compensation plans for selected employees and for third parties. Operating Result Operating result is gross profit less SG&A expenses. Table of Contents Financial Result Financial result includes income from interest earned on fixed deposits, less financial expenses consisting primarily of interest expenses as a result of our financial leases, commitment fees paid for bank overdraft facilities, bank charges and the net realized or unrealized impact of foreign exchange rate fluctuations in a given period. Income Taxes We are subject to income taxes in the jurisdictions in which we operate and, consequently, income tax expense is a function of the allocation of taxable income by jurisdiction and the various activities that impact the timing of taxable events. The primary regions that determine the effective tax rate are Switzerland, the US, China and Japan. Results of Operations For the Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 The following table summarizes results of operations and expresses the percentage relationship to net sales of certain financial statement captions. Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Net sales 3,014.0 2,318.3 30.0 % Cost of sales (1,120.3) (912.6) 22.8 % Gross profit 1,893.6 1,405.7 34.7 % Gross profit margin 62.8 % 60.6 % SG&A expenses (1,516.6) (1,194.2) 27.0 % Operating result 377.0 211.6 78.2 % Net financial result (171.8) 68.1 (352.4) % Income before taxes 205.2 279.6 (26.6) % Income tax expense (1.5) (37.4) (95.9) % Net income 203.7 242.3 (15.9) % Table of Contents Net sales Net sales by sales channel The following table presents net sales by sales channel: Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Wholesale 1,753.4 1,375.5 27.5 % 32.6 % Direct-to-Consumer 1,260.5 942.8 33.7 % 39.9 % Net sales 3,014.0 2,318.3 30.0 % 35.6 % Wholesale % of Net sales 58.2 % 59.3 % Direct-to-Consumer % of Net sales 41.8 % 40.7 % Net sales % 100.0 % 100.0 % (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales for fiscal year 2025 increased by CHF 695.6 million, or 30.0%, compared to fiscal year 2024. Net sales generated by the wholesale sales channel for fiscal year 2025 increased by CHF 377.9 million, or 27.5%, to CHF 1,753.4 million, compared to CHF 1,375.5 million in fiscal year 2024. The increase was attributable to sustained strong demand from our wholesale partners and our continued selective door expansion, particularly with global key accounts. Net sales generated by the DTC sales channel for fiscal year 2025 increased by CHF 317.7 million, or 33.7%, to CHF 1,260.5 million, compared to CHF 942.8 million in fiscal year 2024. The increase was primarily driven by the continued increase in popularity and awareness of the On brand, resulting in high growth on our e-commerce platform and the expansion of our own retail store network across all regions. Additionally, increased traffic and transactions in our existing retail stores contributed to the growth. As a result of the strength of our DTC channel and in line with the strategic ambition for our DTC sales channel to outgrow our wholesale sales channel, net sales generated from the DTC sales channel as a percentage of net sales increased to 41.8% for fiscal year 2025, compared to 40.7% in fiscal year 2024. Net sales by geography The following table presents net sales by geographic region (based on the location of the counterparty): Table of Contents Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Americas 1,740.1 1,480.3 17.6 % 23.4 % EMEA 762.7 577.8 32.0 % 34.7 % Asia-Pacific 511.1 260.2 96.4 % 106.7 % Net Sales 3,014.0 2,318.3 30.0% 35.6% Americas % of Net sales 57.7 % 63.9 % EMEA % of Net sales 25.3 % 24.9 % Asia-Pacific % of Net sales 17.0 % 11.2 % Net sales % 100.0 % 100.0 % (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales increased across all geographic regions in fiscal year 2025 compared to fiscal year 2024 with APAC showing particularly strong growth. The 17.6% increase in net sales in Americas was driven by the ongoing rise in popularity and awareness of the On brand in the region and continued strength in both channels, particularly the collaboration with key account partners and the successful expansion of our retail stores. The 32.0% increase in net sales in EMEA was driven by the growth within our distributor network, the continued strength in the United Kingdom, particularly in our DTC channel, along with notable acceleration from France, Italy and Spain. The 96.4% increase in net sales in APAC was primarily driven by strong sales growth in China and Japan across both channels. Net sales by product The following table presents net sales by product group: Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Shoes 2,804.4 2,199.6 27.5 % 32.9 % Apparel 169.9 101.0 68.2 % 75.5 % Accessories 39.6 17.7 124.1 % 135.1 % Net Sales 3,014.0 2,318.3 30.0 % 35.6 % Shoes % of Net sales 93.0 % 94.9 % Apparel % of Net sales 5.6 % 4.4 % Accessories % of Net sales 1.3 % 0.8 % Net sales % 100.0 % 100.0 % Table of Contents (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales increased across all product groups during fiscal year 2025 compared to fiscal year 2024. The 27.5% increase in net sales for shoes was driven by new product launches, updates to existing models and the continuity of successful products carrying over from previous seasons. Growth was supported by the strong performance of the Cloud and Cloudtilt franchises, as well as contributions from the Cloudsurfer franchises. The 68.2% increase in net sales for apparel was driven primarily by our Performance Running and Performance Training verticals with additional contribution from our Performance All Day vertical. The 124.1% increase in net sales for accessories was driven by growth within the socks category with additional contributions from our headwear category. Gross Profit Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Gross profit 1,893.6 1,405.7 34.7 % Gross profit margin 62.8 % 60.6 % Cost of sales for fiscal year 2025 increased by CHF 207.7 million, or 22.8%, to CHF 1,120.3 million, compared to CHF 912.6 million in fiscal year 2024. Gross profit was CHF 1,893.6 million in fiscal year 2025, representing a gross profit margin of 62.8%, compared with CHF 1,405.7 million in fiscal year 2024, representing a gross profit margin of 60.6%. The increase in gross profit margin was primarily attributable to ongoing operational efficiencies and improvements, particularly in freight, and a favorable foreign exchange impact during fiscal year 2025, compared to fiscal year 2024. Table of Contents Selling, General and Administrative Expenses Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Distribution expenses (322.9) (288.3) 12.0 % Selling expenses (260.1) (168.2) 54.6 % Marketing expenses (376.5) (276.6) 36.1 % Share-based compensation (62.6) (71.5) (12.5) % General and administrative expenses (494.5) (389.5) 27.0 % SG&A expenses (1,516.6) (1,194.2) 27.0 % Less share-based compensation (62.6) (71.5) (12.5) % SG&A (excluding share-based compensation) (1,454.0) (1,122.7) 29.5 % Distribution expenses % of Net sales 10.7 % 12.4 % Selling expenses % of Net sales 8.6 % 7.3 % Marketing expenses % of Net sales 12.5 % 11.9 % Share-based compensation % of Net sales 2.1 % 3.1 % General and administrative expenses % of Net sales 16.4 % 16.8 % SG&A expenses % of Net sales 50.3 % 51.5 % SG&A (excluding share-based compensation) % of Net sales 48.2 % 48.4 % SG&A expenses for fiscal year 2025 increased by CHF 322.4 million to CHF 1,516.6 million, compared to CHF 1,194.2 million in fiscal year 2024. Excluding share-based compensation, SG&A expenses as a percentage of net sales decreased to 48.2% in fiscal year 2025 from 48.4% in fiscal year 2024. The drivers for the fluctuations in SG&A expenses, mostly denominated as a percentage of net sales, can be summarized as follows: •Distribution expenses as a percentage of net sales, decreased to 10.7% in fiscal year 2025 compared to 12.4% in fiscal year 2024. This was primarily attributable to lower warehousing and delivery costs resulting from operational efficiency gains during the twelve-month period ended December 31, 2025. •Selling expenses as a percentage of net sales, increased to 8.6% in fiscal year 2025 compared to 7.3% in fiscal year 2024. The increase was primarily driven by additional expenses incurred as a result of our expanding retail footprint, primarily due to retail store-related personnel costs and depreciation. •Marketing expenses as a percentage of net sales increased to 12.5% in fiscal year 2025 compared to 11.9% in fiscal year 2024. The increase was driven by higher marketing spend on upper funnel brand building initiatives and brand partnerships, in line with our ambition to continue to prioritize meaningful brand building investments. •Share-based compensation expenses decreased to CHF 62.6 million in fiscal year 2025 compared to CHF 71.5 million in fiscal year 2024. Table of Contents •General and administrative expenses as a percentage of net sales, decreased to 16.4% in fiscal year 2025 compared to 16.8% in fiscal year 2024. This decrease is primarily driven by strong net sales growth, partially offset by higher personnel related expenses and higher IT and technology related expenses. Depreciation and Amortization Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Depreciation and amortization (127.4) (104.6) 21.8 % Depreciation and amortization % of Net sales 4.2 % 4.5 % Depreciation and amortization expenses for fiscal year 2025 increased by CHF 22.8 million, or 21.8%, to CHF 127.4 million, compared to CHF 104.6 million in fiscal year 2024. Thereof, depreciation and amortization expenses attributable to right of use assets increased by CHF 18.6 million primarily as a result of the expansion of our retail stores and our enhanced warehouse and distribution facilities. In addition, depreciation and amortization expenses attributable to owned assets increased by CHF 4.1 million, as a result of retail expansion and warehouse investment, mainly related to leasehold improvements. Net Financial Result Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Financial income 30.9 23.5 31.8 % Financial expenses (29.6) (23.1) 27.8 % Foreign exchange gain / (loss) (173.2) 67.7 (355.7) % Net financial result (171.8) 68.1 (352.4) % Financial income for fiscal year 2025 increased by CHF 7.5 million to CHF 30.9 million when compared to fiscal year 2024. This was primarily driven by an increase in the underlying amount of short-term investments. Financial expenses for fiscal year 2025 increased by CHF 6.4 million to CHF 29.6 million when compared to fiscal year 2024. This was primarily driven by higher interest expenses on lease contracts, resulting from additional leases outstanding throughout the twelve-month period ended December 31, 2025 compared to the twelve-month period ended December 31, 2024. Refer to note 3.4 Right-of-use assets and lease liabilities for additional information on new leases. Foreign exchange gain / loss for fiscal year 2025 resulted in foreign exchange loss of CHF 173.2 million, compared to a foreign exchange gain for fiscal year 2024 of CHF 67.7 million. The changes to foreign exchange gain / loss were primarily due to foreign exchange rate revaluation effects, primarily driven by the CHF/USD exchange rate. The total unrealized foreign exchange loss for the twelve-month period ended December 31, 2025, was CHF 116.0 million. Table of Contents Income Tax Expense Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Income tax expense (1.5) (37.4) (95.9) % Effective income tax rate 0.7 % 13.4 % (92.3) % Income tax expense for fiscal year 2025 decreased by CHF 35.8 million to CHF 1.5 million, compared to CHF 37.4 million for fiscal year 2024. Our effective income tax rate was 0.7% for fiscal year 2025, compared to 13.4% in fiscal year 2024. The decreases to the effective income tax rates were mainly due to deferred income tax benefits for the fiscal year 2025 related to the elimination of intercompany profits in inventory, as well as higher effectiveness of certain tax incentives and effects of prior year items. Three-month period ended December 31, 2025 compared to the three-month period ended December 31, 2024 (Unaudited) The following table summarizes results of operations and expresses the percentage relationship to net sales of certain financial statement captions. Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Net sales 743.8 606.6 22.6 % Cost of sales (268.5) (229.8) 16.8 % Gross profit 475.3 376.8 26.1 % Gross profit margin 63.9 % 62.1 % SG&A expenses (392.8) (323.7) 21.3 % Operating result 82.5 53.1 55.4 % Net financial result (12.5) 38.4 (132.4) % Income before taxes 70.0 91.5 (23.5) % Income tax expense (1.0) (2.0) (51.8) % Net income 69.1 89.5 (22.9) % Net sales Net sales by sales channel The following table presents net sales by sales channel: Table of Contents Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Wholesale 383.2 310.4 23.4 % 31.2 % Direct-to-Consumer 360.6 296.2 21.7 % 30.0 % Net sales 743.8 606.6 22.6 % 30.6 % Wholesale % of Net sales 51.5 % 51.2 % Direct-to-Consumer % of Net sales 48.5 % 48.8 % Net sales % 100.0 % 100.0 % (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales for the three-month period ended December 31, 2025, increased by CHF 137.1 million, or 22.6%, compared to the three-month period ended December 31, 2024. Net sales generated by the wholesale sales channel for the three-month period ended December 31, 2025, increased by CHF 72.7 million, or 23.4%, to CHF 383.2 million, compared to CHF 310.4 million for the three-month period ended December 31, 2024. The increase was attributable to growth within our distributor network, sustained strong demand from our wholesale partners, and our continued selective door expansion, particularly with global key accounts. Net sales generated by the DTC sales channel for the three-month period ended December 31, 2025, increased by CHF 64.4 million, or 21.7%, to CHF 360.6 million, compared to CHF 296.2 million for the three-month period ended December 31, 2024. The increase was primarily driven by the continued increase in popularity and awareness of the On brand, resulting in increased traffic and transactions, both on our e-commerce platform and in our existing retail stores. Additionally, the expansion of our own retail store network in all regions further contributed to the growth. Wholesale net sales as a percentage of total net sales increased slightly to 51.5% for the three-month period ended December 31, 2025, compared to 51.2% for the three-month period ended December 31, 2025, driven primarily by strong momentum with key accounts and the expansion of our distributor business. Net sales by geography The following table presents net sales by geographic region (based on the location of the counterparty): Table of Contents Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Americas 434.3 385.1 12.8 % 21.3 % EMEA 183.0 147.4 24.2 % 27.5 % Asia-Pacific 126.5 74.1 70.8 % 85.1 % Net Sales 743.8 606.6 22.6% 30.6% Americas % of Net sales 58.4 % 63.5 % EMEA % of Net sales 24.6 % 24.3 % Asia-Pacific % of Net sales 17.0 % 12.2 % Net sales % 100.0 % 100.0 % (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales increased across all geographic regions for the three-month period ended December 31, 2025, with APAC showing particularly strong growth. The 12.8% increase in net sales in Americas was driven by the ongoing rise in popularity and awareness of the On brand in the region and continued strength in both channels. The 24.2% increase in net sales in EMEA was driven by the continued strength in the United Kingdom, particularly in our DTC channel, the growth within our distributor network, as well as notable acceleration from France and Spain. The 70.8% increase in net sales in Asia-Pacific was primarily driven by growth within our distributor network and strong sales growth in Japan and China. Table of Contents Net sales by product The following table presents net sales by product group: Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Constant Currency % Change (1) Shoes 687.3 568.8 20.8 % 28.8 % Apparel 45.1 32.6 38.3 % 46.0 % Accessories 11.4 5.2 117.7 % 131.3 % Net Sales 743.8 606.6 22.6 % 30.6 % Shoes % of Net sales 92.4 % 93.8 % Apparel % of Net sales 6.1 % 5.4 % Accessories % of Net sales 1.5 % 0.9 % Net sales % 100.0 % 100.0 % (1) The constant currency percent change represents changes to net sales on a constant currency basis, which is a non-IFRS financial measure. See section titled "Non-IFRS Measures" for a description of this measure. Reconciliation to the nearest IFRS measure is shown in table above. Net sales increased across all product groups during the three-month period ended December 31, 2025, compared to the three-month period ended December 31, 2024. The 20.8% increase in net sales for shoes was driven by new product launches, updates to existing models and the continuity of successful products carrying over from previous seasons. Growth was supported by the strong performance of the Cloud and Cloudtilt franchises, with additional strong contributions from the Cloudsurfer franchise. The 38.3% increase in net sales for apparel was driven primarily by our Performance Running and Performance Training verticals. The existing and new collections within the apparel range continue to show strong momentum across both channels, with particularly strong performance in our DTC channel. Net sales in accessories increased by 117.7%. Gross Profit Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Gross profit 475.3 376.8 26.1 % Gross profit margin 63.9 % 62.1 % Table of Contents Cost of sales during the three-month period ended December 31, 2025, increased by CHF 38.7 million, or 16.8%, to CHF 268.5 million, compared to CHF 229.8 million during the three-month period ended December 31, 2024. Gross profit was CHF 475.3 million for the three-month period ended December 31, 2025, representing a gross profit margin of 63.9%, compared with CHF 376.8 million for the three-month period ended December 31, 2024, representing a gross profit margin of 62.1%. The gross profit margin increase was mainly driven by operational efficiencies and improvement (including reduced air freight), strong execution during the period, and a favorable foreign exchange impact during the three-month period ended December 31, 2025, compared to the three-month period ended December 31, 2024. Selling, General and Administrative Expenses Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Distribution expenses (75.1) (70.5) 6.4 % Selling expenses (73.4) (47.9) 53.2 % Marketing expenses (108.1) (79.1) 36.6 % Share-based compensation (14.0) (17.6) (20.4) % General and administrative expenses (122.3) (108.6) 12.6 % SG&A expenses (392.8) (323.7) 21.3 % Less share-based compensation (14.0) (17.6) (20.4) % SG&A (excluding share-based compensation) (378.8) (306.1) 23.7 % Distribution expenses % of Net sales 10.1 % 11.6 % Selling expenses % of Net sales 9.9 % 7.9 % Marketing expenses % of Net sales 14.5 % 13.0 % Share-based compensation % of Net sales 1.9 % 2.9 % General and administrative expenses % of Net sales 16.4 % 17.9 % SG&A expenses % of Net sales 52.8 % 53.4 % SG&A (excluding share-based compensation) % of Net sales 50.9 % 50.5 % SG&A expenses for the three-month period ended December 31, 2025 increased by CHF 69.1 million to CHF 392.8 million, compared to CHF 323.7 million for the three-month period ended December 31, 2024. Excluding share-based compensation, SG&A expenses as a percentage of net sales increased to 50.9% in the three-month period ended December 31, 2025 compared to 50.5% for the three-month period ended December 31, 2024. The drivers for the fluctuations in SG&A expenses, mostly denominated as a percentage of net sales, can be summarized as follows: •Distribution expenses as a percentage of net sales decreased to 10.1% during the three-month period ended December 31, 2025, compared to 11.6% during the three-month period ended December 31, 2024. This was primarily attributable to lower delivery and logistics costs resulting from operational efficiency gains. Table of Contents •Selling expenses as a percentage of net sales increased to 9.9% during the three-month period ended December 31, 2025 compared to 7.9% during the three-month period ended December 31, 2024. The increase was primarily driven by additional expenses incurred as a result of our expanding retail footprint, primarily due to retail store-related personnel costs and depreciation. •Marketing expenses as a percentage of net sales increased to 14.5% during the three-month period ended December 31, 2025 compared to 13.0% during the three-month period ended December 31, 2024. This increase was driven by additional investments into digital marketing opportunities, enabled by our strong topline performance. •Share-based compensation expenses decreased to CHF 14.0 million during the three-month period ended December 31, 2025 compared to CHF 17.6 million during the three-month period ended December 31, 2024. •General and administrative expenses as a percentage of net sales decreased to 16.4% during the three-month period ended December 31 2025 compared to 17.9% during the three-month period ended December 31, 2024. This decrease is primarily driven by strong net sales growth, partially offset by higher IT and technology related expenses. Depreciation and Amortization Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Depreciation and amortization (34.5) (28.7) 20.3 % Depreciation and amortization % of Net sales 4.6 % 4.7 % Depreciation and amortization expenses during the three-month period ended December 31, 2025 increased by CHF 5.8 million to CHF 34.5 million, compared to CHF 28.7 million during the three-month period ended December 31, 2024. Thereof, depreciation and amortization expenses attributable to right of use assets increased by CHF 6.1 million primarily as a result of the expansion of our retail stores and our enhanced warehouse and distribution facilities. In addition, depreciation and amortization expenses attributable to owned assets decreased by CHF 0.3 million. Table of Contents Net Financial Result Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Financial income 8.0 6.3 26.6 % Financial expenses (7.8) (5.9) 32.3 % Foreign exchange gain / (loss) (12.7) 38.0 -133.4 % Net financial result (12.5) 38.4 -132.4 % Financial income for the three-month period ended December 31, 2025 increased by CHF 1.7 million to CHF 8.0 million, compared to CHF 6.3 million for the three-month period ended December 31, 2024. Financial expenses for the three-month period ended December 31, 2025 increased by CHF 1.9 million to CHF 7.8 million, compared to CHF 5.9 million for the three-month period ended December 31, 2024. Foreign exchange gain / loss for the three-month period ended December 31, 2025 resulted in a foreign exchange loss of CHF 12.7 million, compared to a foreign exchange gain of CHF 38.0 million for the three-month period ended December 31, 2024. The changes to foreign exchange gain / loss were primarily due to foreign exchange rate revaluation effects (i.e., unrealized foreign exchange impacts), in particular the CHF/USD exchange rate. Income Tax Expense / (Benefit) Three-month period ended December 31, (CHF in millions) 2025 2024 % Change Income tax expense (1.0) (2.0) (51.75) % Effective income tax rate 1.4 % 2.2 % (50.0) % Income tax expense for the three-month period ended December 31, 2025 decreased by CHF 1.0 million to CHF 1.0 million, compared CHF 2.0 million for the three-month period ended December 31, 2024. Our effective income tax rate was 1.4% for the three-month period ended December 31, 2025, compared to 2.2% for the three-month period ended December 31, 2024. Non-IFRS Measures Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS, net working capital, and net sales on a constant currency basis are financial measures that are not defined under IFRS. We use these non-IFRS measures when evaluating our performance, including when making financial and operating decisions, and as a key component in the determination of variable incentive compensation for employees. We believe that, in addition to conventional measures prepared in Table of Contents accordance with IFRS, these non-IFRS measures enhance investor understanding of our financial and operating performance from period to period, because they enhance the comparability of results between each period, help identify trends in operating results and provide additional insight and transparency on how management evaluates the business. In particular, we believe adjusted EBITDA, adjusted EBITDA margin, adjusted net income and net working capital are measures commonly used by investors to evaluate companies in the sportswear industry. However, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS, net working capital, and net sales on a constant currency basis should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with IFRS and may not be comparable to similarly titled non-IFRS measures used by other companies. The tables below reconcile adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS, and net working capital to their most directly comparable IFRS measure. See section titled "Operating Results" for reconciliations of net sales on a constant currency basis, respectively, to their most directly comparable IFRS measure. Adjusted EBITDA and Adjusted EBITDA Margin The table below provides a reconciliation between net income / (loss) and adjusted EBITDA for the periods presented. Adjusted EBITDA margin is equal to adjusted EBITDA for the period presented as a percentage of net sales for the same period. Fiscal year ended December 31, Three-month period ended December 31, (CHF in millions) 2025 2024 % Change 2025 2024 % Change Net income 203.7 242.3 (15.9) % 69.1 89.5 (22.9) % Exclude the impact of: Income taxes 1.5 37.4 (95.9) % 1.0 2.0 (51.8) % Financial income (30.9) (23.5) 31.8 % (8.0) (6.3) 26.6 % Financial expenses 29.6 23.1 27.8 % 7.8 5.9 32.3 % Foreign exchange result (1) 173.2 (67.7) (355.7) % 12.7 (38.0) (133.4) % Depreciation and amortization 127.4 104.6 21.8 % 34.5 28.7 20.3 % Share-based compensation(2) 62.6 71.5 (12.5) % 14.0 17.6 (20.4) % Adjusted EBITDA 567.0 387.6 46.3 % 131.0 99.4 31.8 % Adjusted EBITDA margin 18.8 % 16.7 % 17.6 % 16.4 % (1) Represents the foreign exchange gain / (loss) line item within the consolidated statements of income / (loss). (2) Management excludes share-based compensation expenses as we do not consider these expenses reflective of our ongoing operations and performance. Table of Contents Adjusted Net Income, Adjusted Basic EPS and Adjusted Diluted EPS We use adjusted net income, adjusted basic EPS and adjusted diluted EPS as measures of operating performance in conjunction with related IFRS measures. For the purpose of operational performance measurement, we calculate adjusted net income, adjusted basic EPS and adjusted diluted EPS in a manner that fully excludes the impact of any costs related to share-based compensation and includes the tax effect on the tax-deductible portion of the non-IFRS adjustments, which we believe increases comparability of the metric from period to period, and makes it useful for management, our audit committee and investors to assess our financial performance over time. Adjusted basic EPS is calculated by dividing adjusted net income by the weighted average number of ordinary shares outstanding during the period. Adjusted diluted EPS is calculated by dividing adjusted net income by the weighted average number of ordinary shares outstanding during the period on a fully diluted basis. The table below provides a reconciliation between net income and adjusted net income, adjusted basic EPS and adjusted diluted EPS for the periods presented: Fiscal year ended December 31, (CHF in millions, except per share data) 2025 2025 2024 2024 Class A Class B Class A Class B Net income 182.7 21.0 216.3 25.9 Exclude the impact of: Share-based compensation(1) 56.1 6.4 63.9 7.6 Tax effect of adjustments(2) 0.1 — 3.2 0.4 Adjusted net income 239.0 27.5 283.4 33.9 Weighted number of outstanding shares(3) 295,550,380 339,541,070 288,465,380 345,437,500 Weighted number of shares with dilutive effects(3) 3,228,817 11,251,482 3,787,481 12,822,456 Weighted number of outstanding shares (diluted and undiluted)(3) 298,779,197 350,792,552 292,252,861 358,259,956 Adjusted basic EPS (CHF) 0.81 0.08 0.98 0.10 Adjusted diluted EPS (CHF) 0.80 0.08 0.97 0.09 (1) Management excludes share-based compensation expenses as we do not consider these expenses reflective of our ongoing operations and performance. (2) The tax effect has been calculated by applying the local tax rate on the tax-deductible portion of the respective adjustments. (3) Weighted numbers of outstanding shares are presented herein in order to calculate adjusted basic EPS in relation to adjusted net income for such periods. Weighted numbers of outstanding shares (diluted and undiluted) are presented herein in order to calculate adjusted diluted EPS in relation to adjusted net income for such periods. Table of Contents Three-month period ended December 31, (CHF in millions, except per share data) 2025 2025 2024 2024 Class A Class B Class A Class B Net income 62.0 7.0 80.0 9.6 Exclude the impact of: Share-based compensation(1) 12.6 1.4 15.7 1.9 Tax effect of adjustments(2) 0.4 — 0.5 0.1 Adjusted net income 75.0 8.5 96.2 11.5 Weighted number of outstanding shares(3) 296,739,035 336,932,339 289,063,973 345,437,500 Weighted number of shares with dilutive effects(3) 2,885,416 8,726,618 4,135,300 13,504,922 Weighted number of outstanding shares (diluted and undiluted)(3) 299,624,451 345,658,957 293,199,273 358,942,422 Adjusted basic EPS (CHF) 0.25 0.03 0.33 0.03 Adjusted diluted EPS (CHF) 0.25 0.02 0.33 0.03 (1) Management excludes share-based compensation expenses as we do not consider these expenses reflective of our ongoing operations and performance. (2) The tax effect has been calculated by applying the local tax rate on the tax deductible portion of the respective adjustments. (3) Weighted numbers of outstanding shares (diluted and undiluted) are presented herein in order to calculate adjusted EPS as adjusted net income for such periods. Net Working Capital Net working capital is a financial measure that is not defined under IFRS Accounting Standards. We use and believe that certain investors and analysts use this information to assess liquidity and management use of net working capital resources. We define net working capital as trade receivables, plus inventories, minus trade payables. This measure should not be considered in isolation or as a substitute for any standardized measure under IFRS Accounting Standards. Other companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure. Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Accounts receivables 305.4 246.1 24.1 % Inventories 419.8 419.2 0.1 % Trade payables (154.8) (166.5) (7.0) % Net working capital 570.3 498.9 14.3 % Table of Contents Net Sales on a Constant Currency Basis Net sales on a constant currency basis is a non-IFRS measure which represents current period results that have been retranslated using exchange rates used in the prior year comparative period. We provide constant currency percent change in net sales within our "Key Financial and Operating Metrics" and "Results of Operations" sections, to enhance the visibility of the underlying growth rate of net sales, excluding the impact of foreign currency exchange rate fluctuations. B. Liquidity and Capital Resources Our primary need for liquidity is to fund working capital requirements, capital expenditures, lease obligations and for general corporate purposes. Our future contractual obligations are further discussed in the “Contractual Obligations and Commitments” section below. We finance our liquidity needs using a combination of our existing cash and cash equivalents balances and cash arising from operating activities. As of December 31, 2025, we had CHF 1,019.9 million of cash and cash equivalents and CHF 570.3 million of net working capital, compared to CHF 924.3 million of cash and cash equivalents and CHF 498.9 million of net working capital as of December 31, 2024. As of December 31, 2025 and 2024, 97.6% and 97.7% of our cash and cash equivalents, respectively, were held at banks that are deemed systemically important financial institutions. Movements in cash and net working capital are discussed in the “Cash Flows” section below. We believe our existing cash and cash equivalent balances and cash flows from operations will be sufficient to meet our net working capital, lease obligations, capital expenditures and other general corporate needs for at least the next twelve months. Additionally, on July 7, 2023, we entered into a CHF 700 million multicurrency credit facility. As of December 31, 2025, and 2024, no amounts had been drawn under the credit facility. Refer to “—Indebtedness” for further details. Our long-term capital requirements may vary materially from those currently planned and will depend on many factors, including the rate of net sales growth, the timing and extent of spending on research and development efforts and other growth initiatives, such as our retail store expansion, the expansion of sales and marketing activities, the timing of new products, and overall economic conditions. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to draw from our credit facility mentioned above, or seek additional equity or debt financing. For additional information regarding our ability to fund our future business activities and requirements, refer to Item 3.D, "Risk Factors," in this Annual Report, including the risk factor section "Additional investments in our business." Table of Contents Cash Flows Fiscal year ended December 31, (CHF in millions) 2025 2024 Change Cash inflow from operating activities 359.5 510.6 (151.1) Cash (outflow) from investing activities (78.6) (64.9) (13.7) Cash (outflow) from financing activities (78.5) (55.4) (23.1) Change in net cash and cash equivalents 202.2 390.4 (188.1) Net cash and cash equivalents at the beginning of the period 924.3 494.6 429.7 Net impact of foreign exchange rate differences (106.7) 39.4 (146.1) Net cash and cash equivalents at the end of the period(1) 1,019.9 924.3 95.5 (1) Net cash and cash equivalents included restricted cash in the amount of CHF 0.9 million as of December 31, 2025 and CHF 0.6 million as of December 31, 2024. Operating activities Cash inflow from operating activities for the twelve-month period ended December 31, 2025 decreased by CHF 151.1 million to CHF 359.5 million, compared to CHF 510.6 million for the twelve-month period ended December 31, 2024. This decrease is mainly driven by a decrease in cash flows from changes in working capital of CHF (233.8) million, primarily due to changes in inventories and trade receivables, and a decrease in cash flows from changes in other current assets / liabilities of CHF (70.7) million, partially offset by higher net income after adjustments of CHF 194.4 million, and various other offsetting decreases and increases. Investing activities Cash outflow from investing activities for the twelve-month period ended December 31, 2025, increased by CHF 13.7 million to CHF 78.6 million, compared to CHF 64.9 million for the twelve-month period ended December 31, 2024. The increase is driven by higher purchases of property, plant and equipment of CHF 12.4 million (refer to note 3.3 Property, plant and equipment for additional information). Financing activities Cash outflow from financing activities for the twelve-month period ended December 31, 2025, increased by CHF 23.1 million to CHF 78.5 million, compared to CHF 55.4 million for the twelve-month period ended December 31, 2024. The increase is primarily driven by higher repayments of lease liabilities of CHF 18.7 million and higher interest expense of CHF 6.2 million mainly due to new leases becoming operational during the twelve-months ended December 31, 2025 (refer to note 3.4 Right-of-use assets and lease liabilities for additional information on the increase to lease liabilities). Table of Contents Capital Management Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change As of December 31, 2025: CHF 0.10 nominal value, 306,847,124 Class A Ordinary Shares issued of which 296,873,353 were outstandingAs of December 31, 2024: CHF 0.10 nominal value, 302,455,664 Class A Ordinary Shares issued of which 289,296,343 were outstanding 30.7 30.2 1.5 % As of December 31, 2025 : CHF 0.01 nominal value, 341,241,680 Class B voting rights shares issued and outstandingAs of December 31, 2024 : CHF 0.01 nominal value, 345,437,500 Class B voting rights shares issued and outstanding 3.4 3.5 -1.2 % Share capital 34.1 33.7 1.2 % Treasury shares (26.7) (26.8) -0.6 % Share premium 760.8 756.9 0.5 % Legal reserves 62.4 53.9 15.7 % Equity transaction costs (8.7) (8.7) — % Tax impact on equity transaction costs 1.3 1.3 — % Share-based compensation 473.2 406.7 16.4 % Capital reserves 1,289.0 1,210.0 6.5 % Other reserves (46.6) (4.0) 1068.9 % Retained earnings 382.6 178.9 113.9 % Equity 1,632.4 1,391.8 17.3 % Class A Shares Class B Shares Shares issued and outstanding as of January 1, 2025 289,296,343 345,437,500 Sale of treasury shares related to share-based compensation and capital increase from conditional capital and capital band(4) 6,529,167 6,325,000 Purchase of treasury shares (4,239) — Conversion of Class B shares to Class A shares (3) 1,052,082 (10,520,820) Shares issued and outstanding as of December 31, 2025(1) 296,873,353 341,241,680 Awards granted under various incentive plans not yet exercised or distributed at December 31, 2025(2) 12,334 — Awards granted under various incentive plans with dilutive effects at December 31, 2025 2,891,507 5,190,342 Table of Contents (1) As of December 31, 2025, there were 9,973,771 treasury shares held by On (December 31, 2024: 13,159,321). (2) These awards require little or no further consideration to be exercised, and as such, have been included in the weighted average number of ordinary shares outstanding used to calculate Basic EPS at December 31, 2025. (3) As announced on Form 6-K filed with the SEC on May 23, 2025, 10,520,820 of Class B Shares were converted into 1,052,082 Class A Ordinary Shares. (4) As announced on Form 6-K filed with the SEC on August 12, 2025, we amended and restated our memorandum and articles of association to increase the number of authorized Class A ordinary shares. Further, on December 3rd, 2025, we amended and restated our memorandum and articles of association to increase the number of authorized Class B ordinary shares (refer to our amended and restated articles of association filed as Exhibit 1.1 to this Annual Report). Refer to 4.5 Share capital for additional information. Share-based compensation As a public company, we grant share-based compensation awards to members of senior management, certain selected employees based on their impact and contribution to On, our extended founder team, and to non-executive members of our board of directors. As of December 31, 2025, On has recognized an increase in shareholders' equity in the balance sheet of CHF 66.6 million for share-based compensation incurred during the twelve-month period ended December 31, 2025. For the twelve-month period ended December 31, 2025, we have recognized a share-based compensation charge of CHF 62.6 million pursuant to the following share-based compensation plans and programs for select employees including our group executive team and senior management team, which account for a part of the increase: • Long Term Incentive Plan 2021 • Compensation of non-executive members of our board of directors Share-based payments are valued based on the grant date fair value of these awards and recorded over the corresponding vesting period. Indebtedness On July 7, 2023, we entered into a CHF 700 million multicurrency credit facility ("credit facility") agreement with On AG, as borrower and guarantor, On Inc., as guarantor, and UBS Switzerland AG, as lead arranger, bookrunner, agent, security agent and lender, and several other lenders party thereto, which replaced our bank overdraft facilities previously reported. We have an option to increase the total availability of borrowings under the facility in an aggregate amount of up to CHF 200 million subject to the satisfaction of certain customary conditions. We entered into the credit facility as part of our prudent financial planning strategy to create future financial flexibility to better align with the size and maturity of the Company. The proceeds of any borrowings under the credit facility may be used towards the financing of working capital requirements and for general corporate purposes, including the roll-in of certain existing bank guarantees and the issuance of new bank guarantees. The credit facility had an initial term of three years, which has subsequently been extended for a total period of two years. Subsequent to extensions, the credit facility will expire on July 7, 2028. As of December 31, 2025 and December 31, 2024, no amounts have been drawn under this credit facility and we do not currently expect to do so in the near term. As of December 31, 2025, we are using the credit facility to provide guarantees and letters of credit, as further discussed in section titled "Off-Balance Sheet Arrangements." The credit facility also contains financial covenants that depend on our consolidated equity as well as our net debt to adjusted EBITDA ratio. As of and during the years ended December 31, 2025 and December 31, 2024, we were in compliance with all covenants under the credit facility Table of Contents The following assets have been pledged in relation to the credit facility: Fiscal year ended December 31, (CHF in millions) 2025 2024 % Change Trade receivables 266.4 280.8 (5.1) % Inventory 340.4 211.7 60.8 % Assets pledged 606.9 492.5 23.2 % Material Cash Requirements The following summarizes our material cash requirements as of December 31, 2025: Fiscal year ended December 31, 2025 (CHF in millions) Total Less than 1 year 1 to 5 years More than 5 years Product purchase obligations(1) 290.0 290.0 — — Endorsement contracts(2) 112.7 41.1 69.4 2.1 Lease liabilities(3) 615.6 100.6 299.0 216.0 Lease commitments(4) 153.8 7.8 67.7 78.3 Other purchase commitments(5) 92.7 78.8 13.8 — Total material cash requirements 1,264.7 518.4 449.9 296.5 (1) We typically place product orders in advance based on forecasted quantities. Product purchase obligations refer to open purchase orders to purchase shoes, apparel and accessories, that are enforceable and legally binding, and that specifies all significant terms. (2) We have endorsement contracts with future cash commitments we are obligated to pay to promoters of our products. (3) Lease liabilities are related to storage spaces (e.g., warehouses), various offices, retail stores, showrooms and cars. (4) Lease commitments represent commitments to new lease contracts, which have not yet commenced as of December 31, 2025, and are therefore not recognized on our balance sheet. The majority of the future lease commitments relate to contracts entered into for new highly-automated warehouse in Belgium (Beringen). The new warehouse in Belgium is expected to be fully operational by the end of 2026, and amounts to CHF 104.4 million (December 31, 2024: CHF 106.7 million) lease commitment. The remaining lease commitments relate to various new stores, offices and warehouses. (5) Our other purchase obligations consist of non-cancellable minimum commitments for warehousing arrangements, IT services, indirect procurement contracts, and other commitments under service contracts. Table of Contents Off-Balance Sheet Arrangements As of December 31, 2025 and December 31, 2024, we provided guarantees and letters of credit in favor of third parties in the amount of CHF 153.2 million and CHF 168.3 million, respectively. Of these amounts, CHF 153.2 million (2025) and CHF 168.3 million (2024) relate to our credit facility, as discussed in the section titled "Indebtedness." Other than the items disclosed here and elsewhere in our document, we do not have any material off-balance sheet arrangements or commitments as of December 31, 2025. Foreign currency risk We are exposed to certain market risks arising from transactions in the normal course of business. The market risk we are principally exposed to is fluctuations in foreign currency exchange rates. The functional currency of each individual entity is determined based on the primary economic environment in which the entity operates (generally the local currency). Our consolidated financial statements are presented in Swiss Francs ("CHF"). Therefore, the net sales, expenses, assets, and liabilities of our non-CHF denominated subsidiaries are translated from their functional currencies into CHF, as a result of which the reported amounts can be affected by fluctuations in the value of the CHF. Foreign exchange differences which arise on translation of our subsidiaries’ balance sheets into CHF are recorded as a foreign currency translation adjustment in accumulated other comprehensive income or loss within shareholders’ equity. As a result of our multinational sales and operations, we are also exposed to fluctuations in foreign exchange at a transactional level. The majority of our transactional foreign exchange risk arises from products sourced in USD and sales denominated in the currencies of the respective destination markets. In 2025 and 2024, 99% and 98% of our net sales, respectively, were generated in currencies other than CHF. Based on foreign currency sensitivity analysis of the consolidated balance sheets, a 10% fluctuation in On's main currencies would impact net income as shown in the table below. These reflect the effect of exchange rate changes on monetary assets and liabilities denominated in a currency other than the functional currency of the entity carrying them. (CHF in millions) 12/31/2025 12/31/2024 Change in USD/CHF +10% 78.6 57.4 Change in USD/CHF -10% (78.6) (57.4) Change in GBP/CHF +10% 9.0 7.1 Change in GBP/CHF -10% (9.0) (7.1) Change in JPY/CHF +10% 4.7 4.1 Change in JPY/CHF -10% (4.7) (4.1) Change in CNY/CHF +10% 9.0 5.1 Change in CNY/CHF -10% (9.0) (5.1) Change in EUR/CHF +10% 2.2 3.0 Change in EUR/CHF -10% (2.2) (3.0) Table of Contents Functional currency change Effective January 1, 2026, On Holding AG (the Group's parent company) and On AG (the Group's main trading entity) have changed their functional currency from the Swiss Franc (CHF) to the US Dollar (USD). These changes will be accounted for prospectively in fiscal year 2026 and do not impact prior period financial statements. The Group’s presentation currency will remain CHF. As a result, in 2026, we expect the effect of exchange rate changes on USD-denominated monetary assets and liabilities, to be reduced, resulting in less impacts within line item foreign exchange gains/ (losses) in our consolidated profit or loss statements. Additionally, beginning in the first quarter of 2026, we will start recording adjustments in other comprehensive income / (loss) to translate these entities' financial statements from USD to CHF (our reporting currency), and expect the impacts to other comprehensive income / (loss) to increase. Refer to note 6.6 Events after the balance sheet date for additional information on the aforementioned functional currency change. C. Research and Development, Patents and Licenses The central tenet of our product design philosophy is to fuse high performance, comfort, sustainable materials and aesthetics, in order to provide our customers with everything they need, and nothing they do not. Our innovations and the performance they deliver have established On as a trusted brand for world-class athletes, amateur runners and customers looking for performance-infused footwear, sportswear and accessories. Research and development plays a key role in driving technical innovation, patents and designs of our footwear, apparel and accessories which we believe is essential to the commercial success of our products. We incurred research, design, and development expenses of CHF 10.6 million, CHF 9.6 million and CHF 8.9 million for the years ended December 31, 2025, 2024 and 2023, respectively, which are expensed as incurred and reported in SG&A expenses in the consolidated statements of income. Additionally, we capitalize certain costs associated with software and intellectual property customized for internal use within the intangible assets line item on the consolidated balance sheets. For the years ended December 31, 2025, 2024 and 2023, capitalized intellectual property and in-house developed software were CHF 2.7 million and CHF 1.4 million; CHF 1.4 million and CHF 1.9 million; and CHF 1.2 million and CHF 0.9 million, respectively. D. Factors Affecting Performance and Trend Information Our growth, our financial condition and results have been, and will continue to be, affected by a number of factors, including the following: Ability to grow into new geographies and to convert distributor markets Entering new geographic markets or converting distributor markets requires us to invest in personnel, marketing, and infrastructure, including additional offices, showrooms, distribution networks and new retail stores. Our international expansion has resulted in, and will continue to result in, increased costs and is subject to a variety of risks, including local competition, inventory risks, risks related to operating retail stores, low initial brand awareness, multilingual customer service, potentially complex import and delivery logistics, and compliance with foreign laws and regulations. Increased costs include, but are not limited to, personnel expenses for sales and marketing teams to initially build a sales network, lacking economies of scale in distribution and supply chain and additional administration expenses. The duration of those additional costs, among others, depends on the geographical size and structure of the particular market, as well as the existing level of brand awareness. A significant portion Table of Contents of the investment to grow net sales is reflected in SG&A. SG&A expenses, after removing share-based compensation expense, as a percentage of net sales were 48.2% for 2025 and 48.4% for 2024. Ability to invest We will continue to make investments across our business to drive growth, and therefore we expect expenses to increase. We will continue to invest significant resources in our people, sales and marketing to drive brand awareness and demand for our products. Marketing expenses as a percentage of net sales were 12.5% for 2025 and 11.9% for 2024. We intend to continue to increase marketing expenses in the future, focusing on elevating brand awareness across our markets, investment in digital customer acquisition and customer experience through our retail network alongside an exciting portfolio of elite athletes, influencers, and public figures. To support our growth, we also intend to continue investing in our distribution network as well as into product inventory. For example, during 2025, distribution expenses increased to CHF 322.9 million, compared to CHF 288.3 million in 2024. Over the past years, we have entered into third party logistics and warehouse services agreements for new, highly-automated fulfillment centers, in order to facilitate our future omnichannel growth in both Europe and North America, and lower our handling cost over time through automation. We have also invested, and intend to continue investing, in successfully developing, implementing and scaling our LightSpray technology and products. We intend to continue investing in new manufacturing partners, which has in the past partially resulted in, and may continue to result in, higher purchasing expenses. We also expect to continue to invest into research and development to drive innovations and product offerings. To support the expansion of our own retail network, we intend to invest into additional physical retail stores and store leases. We plan to continue to invest in our corporate infrastructure, which is essential to our ability to take data driven decisions, enhance customer experience, and enable an efficient and collaborative working environment for our global team The investments made in the past, and those expected to be made in the future, can be expensive and may negatively impact our results of operations. Ability to manage inventory Our ability to grow has been, and will continue to be dependent on the availability of the right inventory at the right time and place. Our data driven approach to demand planning, together with an integrative approach between sales demand and supply planning, has enabled rapid growth, while maintaining a premium positioning. The ongoing transition of our Atlanta warehouse led to some product availability constraints and to delayed or missed deliveries during the first half of fiscal year 2024. While we have seen significantly improved operational execution during the second half of 2024, and in 2025, we may continue to experience operational constraints during the course of On's warehouse automation projects and may potentially incur incremental costs during the ramp-up phase. We remain focused on successfully scaling our global distribution capabilities while deploying enhanced inventory oversight across our network of new and existing logistics partners. Our current inventory balance reflects the purchasing of inventory for our 2026 sales. On continues to manage and mitigate supply chain risks by investing in our partner relationships and visibility of data across our supply network. Customs and duty expenses Most distribution markets that we operate in impose customs and duties on the importation of footwear, apparel, and accessories products manufactured in Vietnam, Turkey, Indonesia, China and most other countries. In 2025, approximately 90% and 10% of our footwear products were produced in Vietnam and Indonesia, respectively. Further, in 2025, approximately 65% of our apparel and accessories units produced were manufactured in Vietnam, 30% in Turkey and 5% in China. In prior fiscal years, we experienced the impact of significant changes in global customs and duty rates for footwear and apparel products, including, but not limited to, higher tariffs for importing Table of Contents apparel from China into the US and the implementation of the Vietnam-European Union Free Trade Agreement and customs impact from Brexit. In August 2025, a fixed reciprocal import tariff by the US of 20% on Vietnam, applied in addition to the existing 20% import tariff in Vietnam, became effective, which has increased and is expected to continue to increase the costs of products we source from outside the US and subsequently sell within the US. New proposals to implement new tariffs or other trade restrictions in the US or other jurisdictions, or to increase global customs and duty rates could negatively impact our business. There remains significant uncertainty and confusion within the business environment and the broader US trade framework, and any judicial rulings or executive or legislative action, including the imposition of new tariffs under alternative statutory authorities or modifications to existing trade measures could increase our costs, disrupt our sourcing strategy, or otherwise adversely affect our business, financial condition and results of operations. In line with our ambition to be the most premium global sportswear brand, we continuously assess our global pricing strategy within the movements of the industry and take action where appropriate to maintain our premium brand positioning. Seasonality On operates two product seasons, spring-summer, which goes from January to June, and fall-winter, which goes from July to December. Each season is characterized by new product launches typically in the first quarter of a product season (i.e. Q1 and Q3). On generally has a higher proportion of net sales in the second half of the fiscal year compared to the first half of our fiscal year due to the phasing of our product seasons and seasonality of demand. In 2025 and 2024, the second half of our fiscal year represented 51% and 54% of our annual net sales, respectively. Foreign exchange We are exposed to fluctuation in foreign exchange on various transactions. We have experienced in fiscal year 2025, and expect to continue to experience, increased foreign exchange rate volatility, which we attribute, in part, to the uncertainty surrounding the global trade environment and to other macroeconomic conditions. In 2025 and 2024, we generated 99% and 98% of our net sales, respectively, in currencies other than CHF. Refer to "Item 5. Operating and Financial Review and Prospects - Liquidity and Capital Resources" section above, and to note 5.2 Foreign currency risk below, for more details on foreign exchange and our foreign exchange exposure. Share-based compensation expenses As a public company, we granted and we will continue to grant share-based compensation awards to members of senior management, other selected employees, our extended founder team, and non-executive members of our board of directors. For the twelve-month periods ended December 31, 2025 and 2024, we recognized share-based compensation expenses of CHF 62.6 million and CHF 71.5 million, respectively, primarily in connection with our LTIP 2021 equity incentive plan. Macroeconomic conditions We are subject to risks and exposures from the evolving global macroeconomic environment, including supply chain disruptions, economic uncertainty, consumer spending, the imposition of tariffs or trade restrictions, including the tariffs imposed by the US, inflation, and resulting fears of potential economic slowdowns or recessions, all of which may increase the cost of our products and other operational costs, and negatively impact customer demand, consumer spending, and our ability to manage inventory. Cost Inflation Table of Contents We and other companies in our industry are and will continue to be affected by inflation rates across geographies, which impact manufacturing related costs, labor expenses, shipping costs, and other areas of our business. We continue to work to mitigate the price increases on products with our strong partner relationships. We seek to continue to diversify our production partners and supplier network to reduce our reliance on single-partner relationships, and provide further mitigation against inflationary price impacts. Labor expenses have also been subject to inflationary pressures due to various external factors, including a generally high interest rate environment, which On seeks to continue to proactively mitigate through long-term partner relationships, diversification of vendors, and assessing our global pricing strategy and taking action where appropriate to maintain our premium brand positioning. E. Critical Accounting Estimates On Holding AG prepares its consolidated financial statements in accordance with IFRS Accounting Standards. For more information about the critical accounting estimates and judgments, see note 1.5 Significant accounting judgments, estimates, and assumptions of our consolidated financial statements for the fiscal year ended December 31, 2025. Recently Adopted Accounting Pronouncements See note 1.4 New and amended standards and interpretations of the consolidated financial statements for the year ended December 31, 2025, included elsewhere in this Annual Report for more information on recently adopted accounting pronouncements.