On Says It’s Raising Prices—but Not Because of Tariffs

On its Q1 earnings call last month, Adidas said it will likely have to raise prices on the sportswear products it sells in the U.S. because of the Trump administration’s tariff policies.

Now Caspar Coppetti, co-founder of Swiss sportswear brand On, has said On also plans to raise prices on certain products it sells in the U.S.—but tariffs aren’t to blame.

On’s Q1 sales rose 40% and came in above expectations. On the earnings call Tuesday following the company’s earnings release, Coppetti said the brand’s pursuit “to be the most premium performance sportswear brand” has put it in “a strong position to have earned pricing power in the different markets that we are in.”

Thus, he continued: “We are in the position to increase prices, and we will do this.”

Starting with the fall/winter season in July, On will increase prices in the US on selected styles “in order to really differentiate our products even more from our competitors on the premium position. And this really puts the print in a unique position and where we think we can thrive even more from a position of strength.”

This echoes what On co-founder David Allemann told Front Office Sports in March when asked if the company is concerned about Trump tariffs. He said the prospect of additional duties for imports into the U.S. weren’t a concern thanks to On’s premium pricing power: “For everything we do, we have a very premium positioning and that also gives us the ability to drive premium margins.”

This is why On Holdings is one of the companies analysts at Bernstein say is particularly well-equipped to manage tariffs and a potential consumer spending pullback.

“We believe higher-end brands will fare better for this exact reason—higher-income consumers and ability to pass on price,” Bernstein analyst Aneesha Sherman tells FOS.

The men’s Cloudmonster running shoe sells for around $170. The men’s lightweight Court Jacket is $160. 

“On should be much more protected from a broader slowdown in demand than its larger incumbent competitors,” Bernstein analysts wrote in an April note, in part because it has relatively low market share in the U.S. compared to competitors. On also boasts strong demand in both wholesale and direct-to-consumer channels, the analysts wrote.   

On’s Q1 direct-to-consumer sales increased 42% while wholesale revenue rose more than 38% from the year earlier. The brand slightly raised its sales guidance for the full year to “at least 28%” (from “at least +27%”), while acknowledging “higher levels of planning uncertainty” amid global trade policy shifts.

Noting increased uncertainty and the impact of the 10% baseline tariffs, it now expects gross profit margin in the range of 60%-60.5% vs. 60.5% previously. 

“Recent global trade policy shifts have introduced higher levels of planning uncertainty, including the potential for increased customs and freight expenses,” the company said in its earnings release.

On makes about 90% of its products in Vietnam. On April 2, President Trump announced he would impose tariffs on countries the U.S. has steep trade imbalances with, but he instituted a 90-day pause a week later. Instead, he implemented a lowered reciprocal tariff of 10%. (Before the pause, goods imported from Vietnam would have come with a 46% tariff.) That 10% tariff, which is currently in effect, is factored into On’s 2025 outlook.

“The outlook that we presented is under the assumption of the tariffs that are currently in place. So specifically for Vietnam, the 10% additional tariff during the post period that we are currently on. So that’s the base for our outlook,” Coppetti said.

Shares of On closed nearly 12% higher Tuesday.