Annual-Report FY2023

Exhibit 99.
On Holding AG
Annual Report 2023

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• Management report (Form 20-F)
• Report of the statutory auditor on the consolidated financial statements of On Holding AG for 2023
• Consolidated financial statements of On Holding AG for 2023
• Report of the statutory auditor on the financial statements of On Holding AG for 2023
• Financial statements of On Holding AG for 2023

The requirement to prepare the management report (Lagebericht) according to art.961c of the Swiss
Code of Obligations is met by the below Form 20-F.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
FORM 20-F
________________________
(Mark One)
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE
o SECURITIES EXCHANGE ACT OF 1934
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
x EXCHANGE ACT OF 1934
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
For the fiscal year ended December 31, 2023

Commission File Number: 001-40795
On Holding AG
(Exact name of registrant as specified in its charter)
n/a
(Translation of Registrant's name into English)
Switzerland
(Jurisdiction of incorporation or organization)
Förrlibuckstrasse 190
8005 Zurich, Switzerland
(Address of principal executive offices)
Martin Hoffmann
Chief Financial Officer and Co-Chief Executive
Officer
Förrlibuckstrasse 190
8005 Zurich, Switzerland
Tel: +41 44 225 1555
Fax: +41 44 225 1556
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
_________________________
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Copies to:
Deanna L. Kirkpatrick
Michael Kaplan
Yasin Keshvargar
Davis Polk & Wardwell LLP
450 Lexington Avenue

New York, NY 10017
(212) 450-4000
Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class Trading Symbol(s) Name of each exchange on which registered
Class A ordinary shares, par
value CHF 0.10 per share ONON New York Stock Exchange
Securities registered or to be registered pursuant to Section 12(g) of the Act.

None
_________________________
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
None
_________________________
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as
of the close of the period covered by the annual report.
Class A ordinary shares: 284,215,277
Class B voting rights shares: 345,437,500
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. ☒ Yes ☐ No
If this report is an annual or transition report, indicate by check mark if the registrant is not required to
file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. ☐ Yes ☒ No
Note—Checking the box above will not relieve any registrant required to file reports pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13
or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. ☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File
required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒
Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-
accelerated filer, or an emerging growth company. See the definition of “large accelerated filer,”
“accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer ☒ Accelerated Filer ☐ Non-Accelerated Filer ☐ Emerging growth company ☐
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP,
indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards† provided pursuant to Section 13(a)
of the Exchange Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial
Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s
assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the
Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued
its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the
financial statements of the registrant included in the filing reflect the correction of an error to
previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a
recovery analysis of incentive based compensation received by any of the registrant’s executive
officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark which basis of accounting the registrant has used to prepare the financial
statements included in this filing:
U.S. GAAP ☐ International Financial Reporting Standards as issued by Other ☐
the International Accounting Standards Board ☒
If “Other” has been checked in response to the previous question, indicate by check mark which
financial statement item the registrant has elected to follow. ☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No
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2023 Memorable Moments
On athlete Hellen Obiri claims the winning title in both the New York and the Boston Marathon.
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On introduces its latest cushioning technology CloudTec Phase with the launch of the Cloudsurfer.
The first On flagship store in the United Kingdom opens on Regent Street, in the heart of London.
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Tennis athletes Iga Świątek and Ben Shelton achieve remarkable success in major Grand Slam
tournaments wearing On.
On takes a significant leap in its sustainability mission by introducing the CleanCloud technology in the
Pace Collection, featuring 20% recycled carbon emissions.
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On hosts its first Investor Day as a public company in Zurich, Switzerland.
On expands its product offering with the launch of its first-ever footwear collection for kids and pre-
teens.
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The On team surpasses 2,000 team members globally.

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PRESENTATION OF FINANCIAL AND OTHER INFORMATION

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
ITEM 3. KEY INFORMATION
A. [Reserved]
B. Capitalization and Indebtedness
C. Reason for the Offer and Use of Proceeds
D. Risk Factors
ITEM 4. INFORMATION ON THE COMPANY
A. History and Development of the Company
B. Business Overview
C. Organizational Structure
D. Property, Plants and Equipment
ITEM 4A. UNRESOLVED STAFF COMMENTS
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
A. Operating Results
B. Liquidity and Capital Resources
C. Research and Development, Patents and Licenses
D. Factors Affecting Performance and Trend Information
E. Critical Accounting Estimates
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
B. Compensation
C. Board Practices
D. Employees
E. Share Ownership
F. Disclosure of a Registrants Action to Recover Erroneously Awarded Compensation
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A. Major Shareholders
B. Related Party Transactions
C. Interests of Experts and Counsel
ITEM 8. FINANCIAL INFORMATION
A. Consolidated Statements and Other Financial Information
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B. Significant Changes
ITEM 9. THE OFFER AND LISTING
A. Offer and Listing Details
B. Plan of Distribution
C. Markets
D. Selling Shareholders
E. Dilution
F. Expenses of the Issue
ITEM 10. ADDITIONAL INFORMATION
A. Share Capital
B. Memorandum and Articles of Association
C. Material Contracts
D. Exchange Controls
E. Taxation
F. Dividends and Paying Agents
G. Statement by Experts
H. Documents on Display
I. Subsidiary Information
J. Annual Report to Security Holders
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
A. Debt Securities
B. Warrants and Rights
C. Other Securities
D. American Depositary Shares
PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS
ITEM 15. CONTROLS AND PROCEDURES
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
ITEM 16B. CODE OF ETHICS
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
ITEM 16G. CORPORATE GOVERNANCE
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ITEM 16H. MINE SAFETY DISCLOSURE

ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT
INSPECTIONS
ITEM 16J. INSIDER TRADING POLICIES
ITEM 16K. CYBERSECURITY
PART III
ITEM 17. FINANCIAL STATEMENTS
ITEM 19. EXHIBITS
SIGNATURES
FINANCIAL STATEMENTS
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PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Certain Definitions
Unless otherwise indicated or the context otherwise requires, all references in this Annual Report
on Form 20-F ("Annual Report") to the terms “On,” “On Holding AG,” the “Company,” “we,” “our,”
“ours,” “us” or similar terms refer to On Holding AG and its consolidated subsidiaries. References to our
“extended founder team” or our “executive officers” are to (i) our “co-founders,” which consists of (a) our
co-founders and executive co-chairmen, David Allemann and Caspar Coppetti, and (b) our co-founder
and executive director Olivier Bernhard, (ii) our chief financial officer and co-chief executive officer,
Martin Hoffmann, and (iii) our co-chief executive officer, Marc Maurer.
All references to “U.S. dollars,” “dollars” or “USD” are to the lawful currency of the United States
of America. All references to “CHF” or “Swiss francs” are to the lawful currency of Switzerland. In this
Annual Report, amounts that are converted from CHF to U.S. dollars are converted at an exchange rate
of USD 1.19 per CHF, the exchange rate as of December 31, 2023.
Financial Statements
We maintain our books and records in Swiss francs and prepare our consolidated financial
statements in accordance with International Financial Reporting Standards ("IFRS") and International
Financial Reporting Interpretations Committee (IFRIC) interpretations (together “IFRS Accounting
Standards”), as issued by the International Accounting Standards Board (IASB).
Rounding
We have made rounding adjustments to some of the figures included in this Annual Report
Accordingly, numerical figures, including percentages shown as totals in some tables may not be an
arithmetic aggregation of the figures that preceded them. With respect to financial information set out in
this Annual Report, a dash (“—”) signifies that the relevant figure is not available or not applicable, while
a zero (“0.0”) signifies that the relevant figure is available but is or has been rounded to zero.
Trademarks and Trade Names

We own registered and unregistered rights in trademarks, service marks, and trade names used
in connection with the manufacturing, distribution and sale of our products, including, among others, On,
the On Logo, On Running, Run On Clouds, Dream On, CloudTec, Speedboard, Helion, Missiongrip,
Cyclon, Cloud, the Cloud Logo, CleanCloud, Cloud X, Cloudalpine, Cloudaway, Cloudboom,
Cloudeclipse, Cloudflow, Cloudflyer, Cloudmonster, Cloudsurfer, Cloudwander, Cloudvista, Cloudultra,
Cloudhero, Cloudroam, Cloudrock, Cloudventure, Cloudvista, Cloudswift, Cloudgo, Cloudstratus,
Cloudrunner, Cloudneo, Cloudtilt, Cloudnova, Cloudrift, Cloudaway, Cloudspike, Cloudswift, Cloudeasy,
and Cloudcombo. Solely for convenience, some of the trademarks, service marks, and trade names
referred to in this Annual Report are listed without the ® and ™ symbols, but such references are not
intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our
rights in and to such trademarks, service marks and trade names.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report contains statements that constitute forward-looking statements. Many of the
forward-looking statements contained in this Annual Report can be identified by the use of forward-
looking words such as “anticipate,” “believe,” “continue,” “could,” “expect,” “estimate,” “forecast,”
“intend,” “may,” “plan,” “potential,” “predict,” “project,” “target,” “will,” “would,” and “should,” among
others.
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Forward-looking statements appear in a number of places in this Annual Report and include, but
are not limited to, statements regarding our intent, belief or current expectations. Forward-looking
statements are based on our management’s beliefs and assumptions and on information currently
available to our management. Such statements are subject to risks and uncertainties, and actual results
may differ materially from those expressed or implied in the forward-looking statements due to various
factors, including, but not limited to, those identified under the section entitled “Risk Factors” in this
Annual Report. These risks and uncertainties include factors relating to:
• the strength of our brand and our ability to maintain our reputation and brand image;
• our ability and the ability of our independent manufacturers and other suppliers to follow
responsible business practices;
• our ability to implement our growth strategy;
• the concentration of our business in a single, discretionary product category, namely footwear,
apparel and accessories;
• our ability to continue to innovate and meet consumer expectations;
• changes in consumer tastes and preferences including in products and sustainability, and our
ability to connect with our consumer base;
• our generation of net losses in the past and potentially in the future;
• our limited operating experience in new markets;
• our ability to open new stores at locations that will attract customers to our premium products;
• our ability to compete and conduct our business in the future;
• health epidemics, pandemics and similar outbreaks, including the COVID-19 pandemic;
• general economic, political, demographic and business conditions worldwide, including
geopolitical uncertainty and instability, such as the Russia-Ukraine or Israel-Hamas conflicts and
shipping disruptions in the Red Sea and surrounding waterways;
• the success of operating initiatives, including advertising and promotional efforts and new
product and concept development by us and our competitors;
• our ability to strengthen and grow our direct-to-consumer (“DTC”) channel;
• our ability to address climate related risks;
• our ability to execute and manage our sustainability strategy and achieve our sustainability-
related goals and targets, including sustainable product offerings, including investor and
customer scrutiny
• our third-party suppliers, manufacturers and other partners, including their financial stability and
our ability to find suitable partners to implement our growth strategy;
• supply chain disruptions, inflation and increased costs in supplies, goods and transportation;
• the availability of qualified personnel and the ability to retain such personnel, including our
extended founder team;
• our ability to accurately forecast demand for our products and manage product manufacturing
decisions;
• our ability to distribute products through our wholesale channel;
• changes in commodity, material, labor, distribution and other operating costs;
• our international operations;
• our ability to protect our intellectual property and defend against allegations of violations of
third-party intellectual property by us;
• Cybersecurity incidents and other disruptions to our information technology ("IT") systems;
• increased hacking activity against the critical infrastructure of any nation or organization that
retaliates against Russia for its invasion of Ukraine;
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• our reliance on complex IT systems;

• our ability to adopt generative artificial intelligence ("AI") technologies in our operations;
• financial accounting and tax matters;
• our ability to maintain effective internal control over financial reporting;
• the potential impact of, and our compliance with, new and existing laws and regulations;
• other factors that may affect our financial condition, liquidity and results of operations; and
• other risk factors discussed under “Risk Factors.”
Forward-looking statements speak only as of the date they are made, and we do not undertake
any obligation to update them in light of new information or future developments or to release publicly
any revisions to these statements in order to reflect later events or circumstances or to reflect the
occurrence of unanticipated events.
PART I
ITEM 1. IDENTIFY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.
ITEM 3. KEY INFORMATION

A. [Reserved]
B. Capitalization and Indebtedness

Not applicable.
C. Reason for the Offer and Use of Proceeds

Not applicable.
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D. Risk Factors
In addition to the other information contained in this Annual Report on Form 20-F, the following
risk factors, as well as additional factors not presently known to us or that we currently deem to be
immaterial, should be considered in evaluating our business. Our business, financial condition, or results
of operations could be materially adversely affected as a result of any of these risks.
Summary of Risk Factors

The following is a summary of the material risk factors associated with an investment in our
Class A ordinary shares, which are more fully described below:
I. Risks Related to Our Business Industry and Economic Environment

i. Brand resilience
ii. Business strategy
iii. Innovation
iv. Competitors
v. Economic, political and market conditions
II. Risks Related to Our Operations, Distribution Network and Suppliers

i. Business operations
ii. Supply chain and distribution
iii. Third-party partners and suppliers
iv. Human capital
v. Climate
III. Risks Related to Our Intellectual Property and Information Technology

i. Protection of intellectual property and litigation
ii. Information technology security, laws, and systems
IV. Risks Related to Financial, Accounting and Tax Matters

i. Additional investments of our resources
ii. Financial reporting and internal controls
iii. Foreign currency exchange rates
iv. Taxes
V. Risks Related to Legal and Regulatory Compliance

i. Trade policies, tariffs and import/export regulations
ii. Data protection laws
iii. Compliance with legal or regulatory requirements, proceedings and audits
VI. Risks Associated with Securities Markets and Ownership of our Class A Ordinary Shares
i. Dual class structure of our shares
ii. Foreign private issuer status
iii. Pricing volatility, dividends, and dilution
iv. Swiss corporate law
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I. Risks Related to Our Business, Industry and Economic Environment
(i) Brand resilience
Our business depends on the strength of our premium brand, and if we are not able to maintain
and enhance our brand, our results of operations may be adversely impacted.
The “On” name, our claims (such as “Running on Clouds”), our product or technical-related
trademarks (such as “Cloud,” “Cloudsurfer,” “Cloudswift,” and “CloudTec,” among others), our designs
and technical patents (such as the “Speedboard”) and our premium performance brand image are
integral to our business, and to the implementation of our strategies for expanding our business. We
believe that the brand image we have cultivated has significantly contributed to the success of our
business and is critical to maintaining and expanding our customer base. Maintaining and enhancing our
premium brand may require us to make substantial investments in areas such as product design,
intellectual property (such as patents and trademarks), marketing, operations, community relations,
employee training and our wholesale and DTC channels, such as investments in additional distribution
partnerships, the opening of new physical and e-commerce stores and other e-commerce projects, and
these investments may not be successful.
We anticipate that, as our business expands into new markets and new product categories,
maintaining and enhancing our brand may become more difficult and may require the use of significant
resources. If these or similar efforts in the future are not successful, our brand may be adversely
impacted. Even if such efforts are successful, they may dilute our image in our core running market.
Conversely, as we penetrate these new markets and our brand becomes more widely available, it could
potentially detract from the appeal stemming from the relative novelty and scarcity of our brand. Our
brand may be adversely affected if our public image or reputation is tarnished by negative publicity,
which may occur due to quality issues relating to our production in China, Vietnam, or Indonesia, or our
use of certain raw materials or product-related environmental concerns. Furthermore, our exposure to
social media platforms may accelerate and aggravate such negative publicity. In addition, ineffective
marketing, product diversion to unauthorized distribution channels, product defects, counterfeit
products, unfair labor practices and failure or legal limitations to protect the intellectual property rights in
our brand are some of the potential threats to the strength of our brand, and those and other factors
could diminish consumer confidence in us. Maintaining and enhancing our brand will depend largely on
our ability to be a leader in premium performance footwear, the apparel and accessories industry and to
continue to offer a range of high-quality products to our customers, which we may not execute
successfully. Any of these factors could harm our sales, profitability, financial condition and the price of
our Class A ordinary shares.
A key element of our growth strategy is innovation, product development and expansion of our
product offerings into new product categories. However, we may be unsuccessful in designing products
that meet our customers’ expectations for our brand or that are attractive to new customers. If we are
unable to anticipate customer preferences or industry changes, or if we are unable to modify our
products on a timely basis or expand effectively into new product categories, we may lose customers.
As of December 31, 2023, our products are available at approximately 10,000 retail stores across our
direct markets. As we expand into new geographic markets, consumers in these new markets may be
less compelled by our brand image and may not be willing to pay a higher price to purchase our
premium performance products as compared to traditional footwear, apparel and accessories. Our
operating results would also suffer if our investments and innovations do not anticipate the needs of our
customers, are not appropriately timed with market opportunities or are not effectively brought to
market.
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We may receive negative publicity if we do not meet expectations of transparency with respect to
our business practices, which could harm our brand image. Additionally, if our independent
contract manufacturers or other suppliers fail to implement socially and environmentally
responsible business practices or fail to comply with applicable laws and regulations or our
guidelines, we may be subject to fines, penalties or litigation and our brand image could also be
harmed due to negative publicity.
Our core values, which include developing high-quality products in a socially and
environmentally responsible manner, as illustrated by shoe models such as Cloudneo, are an important
component of our brand image, which makes our reputation sensitive to allegations of unethical or
improper business practices, whether real or perceived. Parties active in promoting ethical business
practices, in addition to evaluating the substance of companies’ practices, also often scrutinize
companies’ transparency as to such practices and the policies and procedures they use to ensure
compliance by their suppliers and other business partners. As a general matter, we do not expect to
publicly disclose information that we deem competitively sensitive, except as required by law. If we do
not meet the transparency standards expected by parties active in promoting ethical business practices,
we may be subject to negative publicity, regardless of whether the actual labor and other business
practices adhered to by us and our independent manufacturers satisfy the substantive expectations of
such parties. In addition, we may fail to, or only partially, achieve our sustainability and environmental
commitments, which could also result in negative publicity. Such negative publicity could be accelerated
through social media channels and harm our reputation, brand image, business, results of operations,
financial condition and the price of our Class A ordinary shares.
While we are conscious and strategic with our choices of our business partners and require, as
part of our supply contracts, compliance with our Supplier Code of Conduct and our standards, we do
not control our manufacturing suppliers or their business practices. Accordingly, we cannot guarantee
their compliance with our guidelines or applicable laws. A failure by our suppliers to comply with such
requirements could, in turn, lead to reduced sales by us as the result of recalls or adverse consumer
reactions, damage to our brand or cause us to seek alternative suppliers, which could increase our costs
and result in delayed delivery of our products, product shortages or other disruptions of our operations.
In addition, certain jurisdictions in which we sell have various regulations related to
manufacturing processes and the chemical content of our products, including their component parts.
Monitoring compliance by our contract manufacturing and other suppliers is complex, and we are reliant
on their compliance reporting in order to comply with regulations applicable to our products. We may be
subject to investigations, enforcement proceedings or claims arising from our supplier’s actual or alleged
noncompliance with regulations and statutes and/or to claims relating to alleged personal injury, such as
California’s Proposition 65. The expectations of NGOs, consumers or any other third parties regarding
socially and environmentally responsible business practices continually evolve and may be substantially
more demanding than applicable legal requirements. Socially and environmentally responsible business
practices are also driven in part by legal and political developments and by diverse groups active in
publicizing and organizing public responses to perceived ethical shortcomings, which can quickly lead
to negative publicity and boycotts. Accordingly, we cannot predict how such regulations or expectations
might develop in the future and cannot be certain that our guidelines or current practices would satisfy
all parties who are active in monitoring our products or other business practices worldwide. Our
exposure on social media platforms may accelerate and aggravate such negative publicity and boycott
risks not only related to potential non-compliance, but also related to geopolitical developments and
related controversial public discussions, such as recent discussions regarding brands sourcing their
products from China, which NGOs and others are requesting to boycott due to China’s handling of
minorities. Also, China has previously placed pressure and obstacles on international companies who
criticize Chinese politics, and may continue to do so in the future. A failure by our suppliers to comply
with such requirements could, in turn, lead to reduced sales by us as the result of recalls or adverse
consumer reactions, damage to our brand or cause us to seek alternative suppliers, which could
increase our costs and result in delayed delivery of our products, product shortages or other disruptions
of our operations.
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If our grassroots marketing efforts or partnerships with other brands are not successful, our
business, results of operations and financial condition could be harmed. Additionally, the costs
and return on our investments for our sports marketing sponsorships may become more
challenging and this could impact the value of our brand image.
We rely principally on grassroots marketing efforts to advertise our brand. These efforts include
working with select premium brand partners, such as our co-entrepreneur, Roger Federer, athletes
chosen by us, and influencers, who we refer to as our ambassadors. Our ambassadors assist us by
introducing our brand and culture to various communities. Our grassroots marketing efforts must be
tailored to each particular market, which may require substantial ongoing attention and resources. For
instance, we must successfully identify suitable ambassadors in each of our new and existing markets.
Our future growth and profitability and the vibrancy of our premium brand, particularly among running
communities, will depend in part upon the effectiveness and efficiency of these grassroots marketing
efforts. Additionally, we also partner with fashion brands on collaborative product collections. Partnering
with fashion brands can also increase the risk of brand reputational damage if the brand we work with
faces any negative publicity.
An element of our marketing strategy has been to create a link in the consumer market between
our products and professional and Olympic athletes, such as with Roger Federer and various athletes
and celebrities around the world, and we face additional risks as a result. If we lose our celebrity
endorsers, or if our celebrity endorsers engage in activities that damage our reputation (whether actual
or perceived), our brand and our business could be adversely impacted.
We have also developed sponsorship agreements with a variety of athletes. However, as
competition in the footwear, apparel and accessories industry has increased, the costs associated with
athlete sponsorships, including the costs of obtaining and retaining these sponsorships and agreements,
have varied and at times increased greatly. If we are unable to maintain our current association with
athletes, or to do so at a reasonable cost, we could lose the reputational benefit associated with such
partnerships, and we may be required to modify and substantially increase our marketing investments.
Moreover, a failure to continue to correctly identify promising public figures to use and endorse our
products or a failure to enter into cost-effective endorsement arrangements with prominent public
figures could adversely affect our brand, sales and profitability.While our partnerships and sponsorships
of celebrities, athletes or events often aim to enhance brand visibility, credibility, and market reach, such
investments may not always be successful. Additionally, the brand may face adverse consequences in
the event of any scandals involving athletes endorsing or associated with our products or in the event of
injuries while such persons use our product, impacting consumer trust and market reputation.
Because we have not historically made extensive use of traditional advertising channels, such as
print or television advertisements, to build our brand, if our grassroots marketing efforts or sports
marketing sponsorships are not successful, there may not be an immediately available alternative
marketing channel for us to build awareness of our products in a successful manner. This may impair
our ability to successfully integrate new stores into the surrounding communities, to expand into new
markets at all or to maintain the strength or distinctiveness of our brand in our existing markets. In
addition, if our grassroots marketing efforts are unsuccessful and we are required to use traditional
advertising channels in our overall marketing strategy, then we will incur additional expense associated
with the transition to and operation of a traditional advertising channel, and we may not have the
financial or other resources needed to do so successfully. Failure to successfully market our products
and brand in new and existing markets could harm our premium brand and our business, results of
operations, financial condition and the price of our Class A ordinary shares.
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(ii) Business strategy
We may not be able to successfully implement our growth strategies on a timely basis or at all.
Additionally, implementation of these plans may divert the attention of our operational,
managerial and administrative resources, which could harm our competitive position and results
of operations.
Our future success depends, in large part, on our ability to implement our growth strategies,
including expanding our product offerings to earn more share of customers’ closets, continuing to
engage in customer acquisition and retention efforts that drive long-term customer relationships and
continuing to grow our business. Our ability to implement these growth strategies depends, among other
things, on our ability to:
I. manage our risks associated with regard to third-party distribution and expand our product
offerings;
II. increase our brand recognition by effectively implementing our multi-channel strategy
alongside our network of retail relationships without compromising our premium customer
experience;
III. increase customer engagement with our digital platforms;
IV. leverage our investments in our human capital and operational infrastructure to drive traffic
and customer acquisition;
V. expand and diversify our wholesale channel, accelerate partnerships with digital pure play
retailers, and expand our owned retail stores; and
VI. enter into distribution and other strategic arrangements with potential distributors of our
products in order to better influence customer experience with better cost efficiency.
We may not be able to successfully implement our growth strategies and may need to change
them. If we fail to implement our growth strategies or if we invest resources in a growth strategy that
ultimately proves unsuccessful, our business, results of operations, financial condition and the price of
our Class A ordinary shares may be materially and adversely affected.
Because our business is highly concentrated on a single, discretionary product category, namely
footwear, apparel and accessories, we are vulnerable to changes in consumer preferences that
could harm our sales, profitability and financial condition.
Our business is not currently diversified and consists primarily of designing and distributing
footwear, apparel and accessories. In 2023, our main product category across all seasons, our footwear,
was made up of over 70 styles and comprised a significant majority of our sales. Consumer preferences
often change rapidly, and demand for our products is substantially dependent on our ability to attract
customers who are willing to pay a higher price for our premium products. We believe there are a
number of factors that may affect the demand for our products, including:
I. brand loyalty;
II. consumer perceptions of, and preferences for, our products and brands, including, among
other things, as a result of evolving ethical or social standards;
III. seasonality;
IV. consumer acceptance of our new and existing products, including our ability to develop
new products that address the needs and preferences of new consumers;
V. consumer demand for products of our competitors;
VI. publicity, including social media, related to us, our products, our brands, our marketing
campaigns and our celebrity endorsers;
VII. the extent to which consumers view certain of our products as substitutes for other
products we manufacture;
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VIII. the life cycle of our products and consumer replenishment behavior;
IX. changes in consumer confidence and buying patterns, and other factors that impact
discretionary income and spending;
X. legislation restricting our ability to use certain materials in our products;
XI. changes in general economic, political, and market conditions;
XII. pandemics or other outbreaks of illness or disease, such as the COVID-19 pandemic; and
XIII. any future shifts in consumer preferences away from retail spending for footwear, apparel
and accessories would also have a material adverse effect on our business, results of
In addition, we believe that continued increases in sales of footwear, apparel and accessories
will largely depend on customers continuing to demand technical superiority from their premium
products. If the number of customers demanding footwear, apparel and accessories does not continue
to increase, or if our customers are not convinced that our footwear, apparel and accessories are more
functional, stylish or technically superior than other footwear, apparel and accessories alternatives, we
may not achieve the level of sales necessary to support new growth platforms and our ability to grow our
business will be severely impaired, and our business, results of operations, financial condition and the
price of our Class A ordinary shares may be adversely impacted.
Sales of footwear, apparel and accessories may not continue to increase, and this could impair
our ability to innovate and grow our business.
We believe that continued increases in sales of footwear, apparel and accessories will partly
depend on customers continuing to demand footwear, apparel and accessories designed for specific
athletic pursuits such as running. If the number of customers demanding footwear, apparel and
accessories does not continue to increase, the trend of increased focus on health and wellness or the
associated growth in exercise subsides, the appeal of high-technology footwear, apparel and
accessories diminishes, the style of our athletic and technical footwear, apparel and accessories falls out
of fashion with customers or customers engaging in athletic pursuits are not convinced that our
footwear, apparel and accessories are a better choice than available alternatives, our ability to innovate
and grow our business will be severely impaired, and our business, results of operations, financial
condition and the price of our Class A ordinary shares may be adversely impacted.
We have generated net losses in the past and may incur net losses in the future.
Although we generated net income of CHF 79.6 million and CHF 57.7 million for the years ended
December 31, 2023 and 2022, respectively, we generated a net loss of CHF 170.2 million for the year
ended December 31, 2021. We will need to continue to generate and sustain increased net sales and net
income levels in future periods in order to increase profitability, and, even if we do, we may not be able
to maintain or increase our level of profitability over the long term. We intend to continue to expend
significant funds to grow our business, and we may not be able to increase our net sales enough to
offset our higher operating expenses. We may incur significant losses in the future for a number of
reasons, including the other risks described in Item 3. "Risk Factors" of this Annual Report, and
unforeseen expenses, difficulties, complications and delays, and other unknown events. If we are unable
to achieve or sustain profitability, our business, results of operations, financial condition and the price of
our Class A ordinary shares may be adversely impacted.
Our limited operating experience and brand recognition in new markets may limit our expansion
strategy and cause our business and growth to suffer.
Our future growth depends, to a considerable extent, on our efforts to expand our markets and
also on our success in entering new markets throughout the world that we deem attractive. While our
headquarters are in Switzerland, we sell our footwear, apparel and accessories globally. For the year
ended December 31, 2023, 64.9%, 27.2% and 7.9% of our sales were to customers in the Americas,
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Europe, Middle East and Africa ("EMEA"), and Asia-Pacific regions, respectively. We also have limited
experience with regulatory environments and market practices outside of Europe and the United States,
and cannot guarantee that we will be able to penetrate or successfully operate in any such markets. In
connection with our expansion efforts, especially in the United States, we have encountered increased
costs of operations resulting from higher customs, payroll and other expenses and from new and
different business requirements generally. In connection with our continued expansion efforts throughout
the world, we have encountered, and expect to continue to encounter, a number of obstacles including
cultural and linguistic differences, differences in regulatory environments and market practices,
difficulties in keeping abreast of market, business and technical developments and foreign customers’
tastes and preferences, as well as differences in employee expectations and working culture. We may
also encounter difficulty expanding into new markets throughout the world because of limited brand
recognition leading to delayed acceptance of our athletic and technical footwear, apparel and
accessories by customers in these new markets. In particular, we have no assurance that our grassroots
marketing efforts will prove successful outside of the geographic regions in which they have been used
in Europe and the United States. The expansion into new markets may also present competitive,
merchandising, forecasting and distribution challenges that are different from or more severe than those
we currently face. Failure to develop new markets globally or disappointing growth outside of such
markets may harm our business, results of operations, financial condition or the price of our Class A
ordinary shares.
If we fail to adequately continue to connect with our consumer base, it could have a material
adverse effect on our business, results of operations and financial condition.
Our marketing and promotional programs, by focusing on the premium experience our products
provide, are important in capturing the interest of consumers and attracting them to our products and
encouraging purchases by consumers. If we fail to successfully develop and implement marketing,
advertising and promotional strategies in new and existing markets, we may be unable to achieve and
maintain brand awareness and consumer traffic to our sites or stores may be reduced.
We believe that much of the growth in our customer base to date has originated from our
marketing strategy, including social media and other digital marketing efforts. If we are unable to cost-
effectively use social media platforms as marketing tools, our ability to acquire new customers and our
business and financial condition may suffer. Unauthorized or inappropriate use of our social media
channels could result in harmful publicity or negative consumer experiences, which could have an
adverse impact on the effectiveness of our marketing in these channels. In addition, substantial negative
commentary by others on social media platforms could have an adverse impact on our ability to
successfully connect with consumers. In addition, if our customers believe we have failed to live up to
our stated goals (whether real or perceived), including those related to environmental, social and
governance ("ESG") matters, they may use social media platforms to cause reputational damage to our
brand and business. Furthermore, as laws and regulations rapidly evolve to govern the use of these
platforms, the failure by us, our employees or third parties acting at our direction to comply with
applicable laws and regulations could subject us to regulatory investigations, lawsuits (including class
actions), liability, fines or other penalties. Moreover, if digital advertising platforms increase advertising
expenses or change their policies in a manner that is inconsistent with our marketing strategy, our
expenses may increase and the effectiveness of our digital advertising strategy may be diminished, and
our growth may be harmed as a result. Furthermore, an increase in the use of social media platforms for
product promotion and marketing may cause an increase in our burden to monitor compliance of such
platforms, and increase the risk that such materials could contain problematic product or marketing
claims in violation of applicable regulations. These and other risks could adversely affect our business,
results of operations, financial condition and the price of our Class A ordinary shares.
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Our ability to attract customers to our stores and premium products depends heavily on
successfully locating our stores in suitable locations and any impairment of a store location,
including any decrease in customer traffic, could cause our net sales, business and results of
operations to be less than expected and adversely affect our financial condition and the price of
Our approach to identifying locations for our stores and premium products typically favors street
locations and lifestyle centers. As a result, our stores are typically located near retailers or fitness
facilities that we believe are consistent with our customers’ lifestyle choices. Our net sales, business and
results of operations at these stores are derived, in part, from the volume of foot traffic in these
locations. Store locations may become unsuitable due to, and our sales volume, customer traffic and
profitability generally may be harmed by, among other things:
I. economic downturns in a particular area;
II. competition from nearby retailers selling athletic apparel;
III. changing consumer demographics in a particular market;
IV. changing lifestyle choices of consumers in a particular market; and
V. the closing or decline in popularity of other businesses located near our stores, including as
a result of pandemics such as COVID-19.
Changes in areas around our store locations that result in reductions in customer foot traffic or
otherwise render the locations unsuitable could cause our sales, business and results of operations to
be less than expected. While we currently sell our products through a limited number of stores that are
owned and operated by us, we plan to open additional stores in the future. If our net sales, business and
results of operations through stores owned and operated by us increase in the future, the risks
described above may be exacerbated and may adversely affect our financial condition and the price of
(iii) Innovation
We rely on technical innovation, unique designs and high-quality products to compete in the
market for our products. If we fail to continue to innovate and provide consumers with design
features, new technologies and environmentally sustainable products that meet consumer
expectations, we may not be able to generate sufficient consumer interest in our athletic and
technical footwear, apparel and accessories to remain competitive.
Innovation is at the core of our business, and we must continue to invest in research and
development in connection with the innovation, intellectual property and design of our footwear, apparel
and accessories in order to attract and retain consumers. If we are unable to anticipate consumer
preferences or industry changes, or if we are unable to modify our products on a timely basis, we may
lose customers or become subject to greater pricing pressures. Our operating results would also suffer if
our innovations and designs do not respond to the needs and demands of our customers, are not
appropriately timed with market opportunities or are not effectively brought to market. Any failure on our
part to innovate and design new products or modify existing products will harm our brand image and
could result in a decrease in our net sales and an increase in our inventory levels. In addition, we may
not be able to generate sufficient consumer interest in our athletic and technical apparel and accessories
to remain competitive.
In particular, sourcing novel high performance or sustainable materials, technical innovation, our
unique designs and quality control in the design and manufacturing process of athletic and technical
footwear, apparel and accessories is essential to the commercial success of our products. Research and
development play a key role in technical and environmentally sustainable innovation. Over the last two
years, we have systematically redesigned many of our key franchises, like the Cloud and the Cloudswift,
as well as our entire apparel range. We rely upon specialists in the fields of biomechanics, chemistry,
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exercise physiology, engineering, digital technologies, industrial design, sustainability and related fields,
as well as research and advisory boards made up of athletes, coaches, trainers, equipment managers,
orthopedists, podiatrists and other experts to develop and test our performance products. While we
strive to produce products that help to enhance athletic performance and maximize comfort, consumer
demand for our products could decline if we fail to introduce technical and environmentally sustainable
innovations in our products. In addition, if we experience problems with the quality of our products, we
may incur substantial expense to remedy such problems and lose consumer confidence and loyalty,
which could negatively impact our reputation, business, results of operations, financial condition and the
price of our Class A ordinary shares.
Our plans to innovate and expand our product offerings may not be successful, and
implementation of these plans may divert the attention of our operational, managerial and
administrative resources, which could harm our competitive position and reduce our net sales
and profitability.
In addition to our DTC strategy and the expansion of our geographic footprint, we plan to grow
our business by innovating and expanding our product offerings. The principal risks to our ability to
successfully carry out our plans to expand our product offering include:
I. if our expanded product offerings fail to maintain and enhance our distinctive brand identity
and premium quality, our brand image may be diminished, and our sales may decrease;
II. our innovations may fail to be financially viable at scale or may not be well received by our
customers or the market;
III. implementation of our plans may divert management’s attention from other aspects of our
business and place a strain on our management, operational and financial resources, as
well as our information systems; and
IV. incorporation of novel materials or features into our footwear, apparel and accessories may
not be accepted by our customers or may be considered inferior to similar products offered
by our competitors.
Moreover, our ability to successfully carry out our plans to expand our product offerings may be
affected by economic and competitive conditions, changes in consumer spending patterns and changes
in consumer preferences and styles. These plans could be abandoned, could cost more than
anticipated, could impact the quality of our products and could divert resources from other areas of our
business, any of which could negatively impact our competitive position, reduce our net sales and
profitability or negatively impact the price of our Class A ordinary shares.
(iv) Competitors
We operate in a highly competitive market and the size and resources of some of our competitors
may allow them to impose pricing pressures or compete more effectively than we can, resulting
in a loss of our market share and a decrease in our net sales and profitability.
The market for footwear, apparel and accessories is highly fragmented and extremely
competitive. We compete directly against wholesalers and direct retailers of footwear, apparel and
accessories. Because of the fragmented nature of the marketplace, we also compete with other apparel
sellers, including those who do not specialize in footwear, apparel and accessories. Many of our
competitors have significant competitive advantages, including longer operating histories, larger and
broader customer bases, more established relationships with a broader set of suppliers, greater brand
recognition and greater financial, technological and engineering resources, research and development,
store development, marketing, distribution and other resources than we do. We may face intense
pressure with respect to competition for key customer accounts and distribution channels. Because of
the highly competitive nature of our industry, we may face increased pressure from our competitors to
lower our prices for our products, which may adversely impact consumer demand for our products, our
brand image, our realized margins, our net sales and our results of operations. Furthermore, we believe
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that our key customers face intense competition from other department stores, sporting goods stores,
retail specialty stores, and online retailers, among others, which could negatively impact the financial
stability of their businesses and their ability to conduct business with us. These factors may result in a
loss of our market share, a decrease in our net sales and profitability or negative impacts to our
business, results of operations, financial condition and the price of our Class A ordinary shares.
Competitors have and will likely continue to attempt to imitate our premium products and
technology and divert sales.
As our business has expanded, our competitors have imitated, and will likely continue to imitate,
our premium product designs and branding, which could harm our business, results of operations,
financial condition and the price of our Class A ordinary shares. Also, any theft, piracy or leaking, such
as through industrial espionage, of our technologies, materials or trade secrets could cause harm to our
brand and business. Competitors who flood the market with products seeking to imitate our products
could divert sales and dilute the value of our brand. Continued sales of competing products by our
competitors could harm our brand and adversely impact our business, financial condition and results of
operations. While we rely on a variety of intellectual property laws and procedures to protect our
competitive position, intellectual property protection has its limitations. For more information, please see
“—Risks Related to Our Intellectual Property and Information Technology—If we are unable to obtain,
maintain, protect and enforce our intellectual property rights for the products we develop, or if the scope
of our intellectual property protection is not sufficiently broad, others may be able to develop and
commercialize products substantially similar to ours, and our business may be adversely affected."
(v) Economic, political and market conditions
We may be adversely affected by the financial health of our retail partners and customers.
We extend credit to our retail partners based on an assessment of a customer’s financial
condition, generally without requiring collateral. To assist in the scheduling of production and the
shipping of our products, we offer certain customers the opportunity to place orders five to six months
ahead of delivery under our futures ordering program. These advance orders may be canceled under
certain conditions, and the risk of cancellation may increase when dealing with financially unstable
retailers or retailers struggling with economic uncertainty. In the past, some customers have experienced
financial difficulties, including bankruptcies, which have had an adverse effect on our sales, our ability to
collect on receivables and our financial condition. In addition, we and our retail partners could face risks
from a decline in the overall level of consumer retail spending, and a weak retail environment could
impact customer traffic in the stores of our retail partners and also adversely affect our net sales.
Moreover, traditional brick-and-mortar retail channels have experienced low growth or declines in recent
years, including as a result of rise in online purchases and recent trends have increased permanent and
temporary store closures. Recent years have also seen shifts in consumer preferences and purchasing
practices, which may increase the difficulty for us to retain and grow our customer base. If and when the
retail economy weakens or as consumer behavior shifts, retailers may be more cautious with orders. A
slowing or changing economy in our key markets could adversely affect the financial health of our
customers, which in turn could have an adverse effect on our results of operations and financial
condition. In addition, product sales are dependent in part on high-quality merchandising and an
appealing retail environment to attract consumers, which requires continuing investments by retailers.
Retailers that experience financial difficulties may fail to make such investments or delay them, resulting
in lower sales and orders for our products. These and other risks could adversely affect our business,
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An economic recession, depression, downturn, periods of inflation, or economic uncertainty may

adversely affect consumer purchases of discretionary items, which could materially harm our
sales, profitability and financial condition.
Many factors affect the level of consumer spending for discretionary items such as our footwear,
apparel and accessories. These factors include general business conditions, inflation, interest and tax
rates, the availability of consumer credit and consumer confidence in future economic conditions.
Consumer purchases of discretionary items, such as our premium footwear, apparel and
accessories, tend to decline during recessionary periods when disposable income is lower, and during
such periods consumers may tend to choose less costly products and turn away from our premium
products. Recent geopolitical events and general economic conditions, such as rising inflation and
increased interest rates, have led to a slow-down in certain segments of the global economy and
affected the amount of discretionary income available for certain consumers to purchase our products.
Any downturn in the economy in markets in which we sell our products may materially harm our sales,
business, results of operations, financial condition and the price of our Class A ordinary shares.
Our international operations involve inherent risks which could result in harm to our business.
All of our premium footwear, apparel and accessories are manufactured outside of the United
States, and a significant amount of our products are sold outside of the United States. Accordingly, we
are subject to the risks generally associated with global trade and doing business abroad, which include
foreign laws and regulations, varying consumer preferences across geographic regions, political unrest
(for example national or international armed conflicts), disruptions or delays in cross-border shipments
for various reasons and changes in economic conditions in countries in which our products are
manufactured or where we sell products. This includes, for example, new and proposed changes
affecting tax laws and trade policy in the United States and elsewhere, as further described below under
“—Risks Related to Financial, Accounting and Tax Matters— We could be subject to changes in tax
laws, tax regulations and tax treaties, including their interpretation and application, in Switzerland, the
United States or any other country in which we operate, which could result in additional tax liabilities or
increased volatility in our effective tax rate” and “—Risks Related to Legal and Regulatory Compliance—
Changes to trade policies, tariffs and import/export regulations in the United States, EU and other
jurisdictions, or our failure to comply with such regulations, may have a material adverse effect on our
reputation, business, financial condition and results of operations.” There could be legislative actions
limiting outsourcing manufacturing and production activities to foreign jurisdictions, including through
tariffs or penalties on goods manufactured outside the United States, which may require us to change
the way we conduct business and adversely affect our business, results of operations, financial
condition and the price of our Class A ordinary shares.
In addition, disease outbreaks, including the COVID-19 pandemic, terrorist acts and political or
military conflicts have increased the risks of doing business abroad. These factors, among others, could
affect, among other things, our ability to manufacture products or procure materials, our ability to import
products, our ability to ship our products globally, our ability to sell products in international markets and
our cost of doing business. If any of these or other factors make the conduct of business in a particular
country undesirable, unprofitable or impractical, our business and financial results could be adversely
affected. In addition, many of our imported products are subject to duties, tariffs or quotas that affect
the cost and quantity of various types of goods imported into the United States and other countries. Any
country in which our products are produced, imported or sold may eliminate, adjust or impose new
quotas, duties, tariffs, safeguard or protectionist measures, anti-dumping duties, cargo restrictions to
prevent terrorism, restrictions on the transfer of currency, climate change legislation, product safety
regulations or other charges or restrictions, any of which could have an adverse effect on our business,
Furthermore, we are subject to the U.S. Foreign Corrupt Practices Act as well as the anti-
corruption laws of other countries in which we operate. Although we have implemented policies and
procedures designed to promote compliance with these laws, our employees, contractors and agents,
including the partners, suppliers and companies to which we outsource certain of our business
operations, may take actions in violation of our policies or such laws. In addition, these policies and
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procedures might not be sufficient or adequate to prevent violations by our employees, contractors and
agents of our policies or such laws. Any such violation could result in sanctions or other penalties and
have an adverse effect on our reputation, business, results of operations, financial condition and the
We distribute our products to customers directly from the factory and through distribution
centers located throughout the world. Our ability to meet customer expectations, manage inventory,
complete sales and achieve objectives for operating efficiencies and growth, depends on the proper
operation of our distribution facilities, the development or expansion of additional distribution
capabilities and the timely and proper performance of services by third parties, including those involved
in shipping product to and from our distribution facilities. In addition, our property damage, business
interruption and other insurance policies may not adequately protect us from adverse effects caused by
significant disruptions to our distribution facilities. Any negative impacts to our distribution facilities
could result in an adverse effect on our business, results of operations, financial condition and the price
of our Class A ordinary shares.
Political uncertainty or geopolitical tensions could have a material adverse effect on our business,
results of operation and financial condition.
As a prominent Swiss brand, geopolitical events that involve Switzerland may have an impact on
our business and share price. In addition, our brand and Swiss heritage may be detrimental to the
Company in the context of geopolitical disputes aimed at Switzerland or actors or situations with
significant actual or perceived connection to Switzerland. We sell a significant portion of our products to
customers outside of Switzerland and changes, potential changes or uncertainties in regulatory and
economic conditions or laws and policies governing foreign trade, manufacturing, and development and
investment in the territories and countries where we operate, could adversely affect our business, results
of operations, and financial condition.
The conflict between Russia and Ukraine and the war between Israel and Hamas have resulted
in worldwide geopolitical and macroeconomic uncertainty, and we cannot predict how these conflicts
will evolve or the timing and effects thereof. These conflicts could grow and bring about disruption,
instability and volatility in global markets, supply chains and logistics operations, such as recent
shipping disruptions in the Red Sea and surrounding waterways, which could in turn adversely affect our
business operations and financial performance. If these conflicts continue for a significant time or further
expand to other countries and depending on the ultimate outcomes of these conflicts, which remain
uncertain, they could have additional adverse effects on macroeconomic conditions, including but not
limited to, increased costs, constraints on the availability of materials, supply chain disruptions and
decreased consumer spending. Furthermore, the potential continuation and expansion of these conflicts
could give rise to disruptions to our or our business partners’ global technology infrastructure, including
through cybersecurity incidents; adverse changes in international trade policies and relations; regulatory
enforcement; our ability to implement and execute our business strategy; terrorist activities; our
exposure to foreign currency fluctuations; and constraints, volatility, or disruption in the capital markets,
any of which could magnify the impact of other risks factors discussed in this Annual Report and have a
material adverse effect on our business, results of operations, cash flows, financial condition and the
Our financial condition and results of operations have been, and could in the future be,
adversely affected by a pandemic, epidemic or other public health emergency.
Pandemics, including the COVID-19 pandemic, and other public health emergencies have
caused, and may in the future cause disruptions to our business, including disruptions to sourcing, our
supply chain, our manufacturing facilities and our distribution facilities. For example, in 2022 and 2021,
the COVID-19 pandemic caused operations in certain of our suppliers’ facilities to be disrupted or
temporarily suspended, certain of our warehouses to experience disruptions or operate at reduced
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capacity, and further caused us to delay our plans to expand our footwear supplier base beyond
Vietnam.
The effects of the COVID-19 pandemic have also had a negative impact on many of our
business partners, such as the retail stores and distributors that sell our products, and can in the future
adversely impact some or all of such partners. Moreover, the negative implications of COVID-19,
including from responses to the pandemic, may not be predictable and may negatively impact our
business and operations, including in ways that we do not currently anticipate. For example, certain
unemployment programs instituted by governments caused our operations to experience a workforce
shortage and increased costs, and other unpredictable results of the COVID-19 pandemic, or any future
epidemic or pandemic, may cause adverse changes to our business, financial condition, results of
operation and the price of our Class A ordinary shares.
The spread of COVID-19 and its various mutations of the virus (e.g. Delta, Omicron and other
variants) had caused public health officials to impose restrictions and recommend precautions to
mitigate the spread of the virus, especially avoiding congregating in heavily populated areas, such as
malls and fitness centers, in which our owned and operated stores and retail outlets are located. Such
measures include restrictions such as limitations on the number of guests allowed in our stores at any
single time, minimum physical distancing requirements and limited operating hours. Even though
COVID-19 related measures have been lifted in our main markets, we do not know whether new
measures will be recommended by local authorities or will need to be implemented by us in the future,
including if there are future COVID-19 resurgences or any other public health crisis. In such a case, there
could be significant uncertainty regarding what the results of operations of our stores would be.
Additionally, pandemics, epidemics or other health emergencies (including COVID-19) could
increase the magnitude of many of the other risks described in "Item 3. Risk Factors" of this Annual
Report and may have other material adverse effects on our operations that we are not currently able to
predict. If our business and the markets in which we operate experience a prolonged occurrence of
adverse public health conditions, it could materially adversely affect our business, financial condition,
results of operations and the price of our Class A ordinary shares.
II. Risks Related to Our Operations, Distribution Network and Suppliers
(i) Business operations
We have grown rapidly in recent years and we have limited operating experience at our current
scale of operations. If we are unable to manage our operations at our current size or to manage
any future growth effectively, our brand image and financial performance may suffer.
We have expanded our operations rapidly since our inception in 2010 and have limited operating
experience at our current scale of operations. Our products were first carried by wholesale partners in
Switzerland in 2010, with a subsequent expansion in Europe and first points of sale in the U.S. in 2013.
We launched our own e-commerce platform in 2012 operated by On to offer e-commerce shopping in
most countries in which we had a physical points of sale. Outside of China, we have 10 retail stores
operated by us to date, five of which are located in the Americas, four in EMEA, and one in APAC. We
also operate 22 mall-based stores in China.
Our substantial growth to date has placed a significant strain on our management systems and
resources. If our operations continue to grow, of which there can be no assurance, we will be required to
continue to expand our sales and marketing, product development and distribution functions, to
upgrade our management information systems and other processes, and to obtain more space for our
expanding administrative support and other headquarters personnel. Moreover, our new innovations
may require either new or different infrastructure, relationships or processes. Our continued growth
could increase the strain on our resources, and we could experience serious operating difficulties,
including difficulties in hiring, training and managing an increasing number of employees, difficulties in
obtaining sufficient supplies, raw materials and manufacturing capacity to produce our products, and
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delays in production and shipments. These difficulties would likely result in the erosion of our brand
image and lead to a decrease in net sales, income from operations and the price of our Class A ordinary
shares.
We may not be able to successfully execute our growth strategy on the continued expansion of
our DTC channel, including our own retail stores and e-commerce platform.
Our business involves distributing products on a wholesale basis for resale through our retail
partners and also includes a multi-channel experience, including physical and online retail stores that are
owned and operated by us. Growing our e-commerce platforms and the number of physical stores
owned by us is essential to our growth strategy, as is innovating and expanding our product offerings
available through these channels. Sales in our DTC channel continue to grow, which may expose us to
other risks, including those relating to continuing to grow brand awareness. This strategy has, and will
continue to require significant investment in cross-functional operations and management focus, along
with investment in supporting technologies and retail store spaces. If we are unable to provide a
convenient and consistent experience for our customers, our ability to compete and our results of
operations could be adversely affected. In addition, if our e-commerce platform design does not appeal
to our customers, function reliably and conveniently, or maintain the privacy and security of customer
data, or if we are unable to consistently meet our brand promise to our customers, we may experience a
loss of customer confidence or sales, including as a result of losing repeat customers, or be exposed to
fraudulent purchases, cybersecurity incidents or other issues which could adversely affect our reputation
and results of operations.
As of December 31, 2023, we currently operate our e-commerce digital platforms in multiple
countries globally, which are serviced by our wholesale channel as well. Additionally, we are planning to
expand the reach of our e-commerce platform to new geographies. Existing and additional countries
may impose different and evolving laws governing the operation and marketing of e-commerce
websites, as well as the collection, storage and use of information on consumers interacting with those
websites. We may incur additional costs and operational challenges in complying with these laws, and
differences in these laws may cause us to operate our businesses differently in different territories. If so,
we may incur additional costs and may not realize benefits from our investment in our international
expansion. We are also exposed to the risk of fraudulent domains or websites pretending to sell our
products, when they are in reality phishing sites or imitator domains, and we might be unable to stop
those sites from operating in due time, or permanently due to regulatory or factual constraints.
Our business or our results of operations could be harmed if we or our wholesale partners are
unable to accurately forecast demand for our products or if we are unsuccessful at managing
product manufacturing decisions.
To ensure adequate inventory supply, we and our wholesale partners forecast inventory needs,
which are subject to seasonal and quarterly variations, and are also subject to variation as a result of
broader economic and social trends. Like our competitors, we have an extended design, development,
manufacturing and logistics process, which involves the initial design and development of our products,
the purchase of raw materials, the accumulation and subsequent sale of inventories, and the collection
of the resulting accounts receivable. This production cycle requires us to incur significant expenses
relating to the design, development, manufacturing, distributing and marketing of our products, including
product development costs for new products, in advance of the realization of any net sales from the sale
of our products, and results in significant liquidity requirements and working capital fluctuations
throughout our fiscal year. Because the production cycle typically involves long lead times, which
requires us to make manufacturing decisions several months in advance of an anticipated purchasing
decision by the consumer, it is challenging for us to estimate and manage our inventory and working
capital requirements, and as such challenges have been, and could in the future be, exacerbated by
global supply chain issues. If we fail to accurately forecast demand or our inventory and working capital
requirements, we may experience excess inventory levels or a shortage of product to deliver to our
wholesale partners and through our DTC channels. In addition, we or our wholesale partners may fail to
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accurately forecast the demand for our products and may purchase an insufficient amount of our
products or may accumulate excess inventory, increase operational complexity and lower cost
efficiency, or increase operational costs. Moreover, a potential increase of inventory stock level resulting
from fluctuating supply/demand/logistics lead time and capacity may increase our operational costs
such as rental costs, and may increase our cost of goods sold and decrease profit margin, if additional
freight charges, including demurrage and detention costs, are incurred, and can negatively impact our
business, brand and results of operations.
If we underestimate the demand for our products, we may not be able to produce products to
meet our wholesale partner requirements, and this could result in delays in the shipment of our products
and our failure to satisfy demand, as well as damage to our reputation and wholesale partner
relationships. If our wholesale partners underestimate the demand for our products, they may not have
enough products on hand to satisfy demand in a timely fashion and sales opportunities may be lost. If
we or our retail partners overestimate the demand for our products, we or our wholesale partners could
face inventory levels in excess of demand, which could result in inventory write-downs or write-offs and
the sale of excess inventory at discounted prices, which would harm our gross profit margins and our
brand management efforts. In addition, these and other factors, including failures to accurately predict
the level of demand for our products, could cause a decline in net sales and harm our business,
operating results, financial condition, cash flows and the price of our Class A ordinary shares.
We may not be able to successfully open new retail stores owned and operated by us in a timely
manner, if at all, which could harm our results of operations.
Our growth will depend in part on our ability to successfully open and operate new retail stores
owned and operated by us or convince third parties to operate those stores and sell our premium
products on our behalf. Our ability to successfully open and operate new retail stores depends on many
factors, including, among others, our ability to:
• identify suitable store locations, the availability of which is outside of our control;
• negotiate acceptable lease terms, including desired tenant improvement allowances;
• hire, train and retain store personnel and field management;
• assimilate new store personnel and field management into our corporate culture and spirits;
• source sufficient inventory levels; and
• successfully integrate new retail stores owned and operated by us into our existing
operations and information technology systems.
Successful new store openings may also be affected by our ability to initiate our grassroots
marketing efforts to identify new and suitable markets for the opening of a potential new retail store. We
typically rely on our grassroots marketing efforts to build awareness of our brand and demand for our
products. Our grassroots marketing efforts are often lengthy and must be tailored to each new market
based on our emerging understanding of the market. Accordingly, there can be no assurance that we
will be able to successfully implement our grassroots marketing efforts in a particular market in a timely
manner, if at all. Additionally, we may be unsuccessful in identifying new markets where our footwear,
apparel and accessories and other products and brand image will be accepted or the performance of
our retail stores owned and operated by us will be considered successful. Furthermore, we will
encounter pre-operating costs and we may encounter initial losses while new stores commence
operations.
Outside of China, we have 10 retail stores operated by us to date, five of which are located in
the Americas, four in EMEA, and one in APAC. We also operate 22 mall-based stores in China. We plan
to open other stores owned and operated by us in the future. We expect that we will incur additional
capital expenditures to open additional stores operated by us in the future, which may be significant. We
have limited experience opening our own stores, and there can be no assurance that we will be able to
open additional stores successfully. In addition, new retail stores owned and operated by us will not be
immediately profitable, and will cause losses until these stores become profitable and such stores have
required, and will continue to require, substantial fixed investment in equipment and leasehold
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improvements and personnel, and we have entered into substantial operating lease commitments for
retail space. There can be no assurance that we will open our planned number of new stores in 2024 or
thereafter, or that our estimates regarding the associated costs will be accurate. Any failure to
successfully open and operate new stores operated by us would harm our business, results of
We are subject to risks associated with leasing retail and distribution, office and warehouse
spaces subject to long-term and non-cancelable leases.
We enter into lease agreements for all of our stores and our inability to secure appropriate real
estate or lease terms could impact our ability to grow. Our leases generally have initial terms of between
five and ten years, and generally can be extended in five-year increments, if at all. We generally cannot
unilaterally terminate these leases at an earlier time. If an existing or new store owned and operated by
us is not profitable, and we decide to close it, we may nonetheless be committed to perform our
obligations under the applicable lease including, among other things, paying rent for the balance of the
lease term.
Similarly, we may be committed to perform our obligations under the applicable leases even if
current locations of our retail stores become unattractive as demographic patterns change, or if we have
to close retail stores due to governmental orders, for example in connection with pandemics, including
the COVID-19 pandemic, and other public health emergencies. If the current remote working trends that
have arisen since the COVID-19 pandemic continue to exist in the future, we may be committed to
perform our obligations under our leases for office space and distribution locations that we do not need,
which may adversely affect our financial condition. Moreover, as our operations expand, we may be
unable to find additional office space to accommodate our needs. In addition, as each of our leases
expire, we may fail to negotiate renewals, either on commercially acceptable terms or at all, which could
require us to close retail stores owned and operated by us in desirable locations. We also lease all of our
distribution centers and our inability to secure appropriate real estate or lease terms could impact our
ability to deliver our products to the market.
(ii) Supply-chain and distribution
We have in the past and could in the future experience significant disruptions in supply from our
current or future sources.
We have agreements with our suppliers that are on a purchase order basis and typically rely on
inventory forecasts to help determine our quantities for purchase orders. We are highly dependent upon
our suppliers, several of them representing a significant share of certain components of our footwear,
apparel and accessories and certain of our suppliers are concentrated in a single country. Identifying a
suitable supplier is a resource-intensive process that requires us to become satisfied with their quality
control, responsiveness and service, financial stability and labor and other ethical practices. In addition,
any indirect supply chain disruptions due to the Russia-Ukraine or Israel-Hamas conflicts and shipping
disruptions in the Red Sea and surrounding waterways, trade restrictions, political instability, severe
weather and natural disasters, war, labor shortages, reduced freight availability and increased costs,
port disruptions and other factors may further complicate existing supply chain constraints. Interruption
of supplies from any of the Company’s suppliers, or the loss of one or more key suppliers, could have a
negative effect on the Company’s business and operating results.
Any delays, interruption or increased costs in the supply of fabric, raw materials or other
subcomponents or manufacture of our products have in the past and could in the future have an adverse
effect on our ability to meet customer demand for our products and result in lower net sales and
operating income both in the short and long term, which could in turn negatively impact our business,
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Problems with our distribution system, including our partners’ ability to scale warehouse and
factory operations, could harm our ability to meet customer expectations, manage inventory,
complete sales and achieve objectives for operating efficiencies.
We rely on distribution facilities in Australia, Brazil, Canada, China, Hong Kong, Japan,
Luxembourg, Switzerland, the United Kingdom and the United States, all of which are operated by third-
party vendors, for substantially all of our product distribution. Our contracts for these facilities expire at
various times, and we may be unable to successfully renegotiate such agreements on terms attractive to
us. In addition, we may be unable to terminate such contracts at our convenience. There can be no
assurance that we will be able to enter into other contracts for distribution centers on acceptable terms,
which could disrupt our operations. Our distribution facilities include computer controlled and automated
equipment, and their operations are complicated and may be subject to a number of risks related to
security or computer viruses, the proper operation of software and hardware, electronic or power
interruptions or other system failures. In addition, because substantially all of our products are
distributed from these distribution centers, our operations could also be interrupted by labor difficulties,
or by floods, fires or other natural disasters or force majeure events.
Additionally, our potential, anticipated growth will require further investments into our supply
chain and operations capabilities, including but not limited to new warehouses or other facilities. For
instance, in the third quarter of 2022 we entered into a third party logistics and warehouse services
agreement for a new, highly-automated fulfillment center in Atlanta (USA) to facilitate our future
omnichannel growth in North America and lower our handling cost over time through automation. In the
second quarter of 2023, we also signed a similar contract for a new fulfillment center in Belgium
(Beringen). If our partner's ability to scale warehouse operations and automation is unsuccessful or if the
warehouse automation does not provide the anticipated benefits or it does not meet market demands,
our financial condition and results of operations can be adversely impacted.
In addition, the property damage, business interruption and other insurance policies held by us
may not adequately protect us from the adverse effects that could result from significant disruptions to
our business and distribution system, such as the long-term loss of customers or an erosion of our
brand image. In addition, our distribution capacity is dependent on the timely performance of services by
third parties, including the uninterrupted operation of our warehouses as well as the shipment of our
products to and from our distribution facilities around the globe, including in Europe, Asia and the United
States. If we encounter problems with our distribution system, our ability to meet customer
expectations, manage inventory, complete sales, achieve objectives for operating efficiencies and the
price of our Class A ordinary shares could be harmed.
Fluctuations in the cost of raw materials and commodities we use in our products and our supply
chain, including as a result of inflation, could negatively affect our operating results.
The fabrics and other subcomponents used by our suppliers and manufacturers are made of raw
materials, including virgin and recycled petrol-based and bio-based polyester, polyamide and ethylene
vinyl acetate, rubber and organic cotton. Significant raw material price fluctuations, such as oil prices,
including as a result of inflation, or shortages in such raw materials could adversely impact our cost of
goods sold. We are also subject to risks from price fluctuations due to our storage capacity restrictions
at our warehouses for the raw materials that our suppliers and manufacturers use for production.
Furthermore, we and our manufacturers compete with other companies and industries for raw materials
used in our products. In the event of heightened competition for such materials, we or our manufacturers
might not be able to locate alternative suppliers of materials of comparable quality at an acceptable
price or at all. In addition, all our manufacturers are subject to government regulations related to wage
rates, and therefore the labor costs to produce our products may fluctuate. The cost of transporting our
products for distribution and sale is also subject to fluctuation due in large part to the price of oil, but
such costs are also subject to geopolitical and climate change impacts that may disrupt our global
supply chains, including from geopolitical conditions such as international conflicts, such as the military
conflict in Ukraine, and resulting sanctions imposed by the U.S. and other countries. Because most of
our products are manufactured abroad, our products must be transported by third parties over large
geographical distances and an increase in the price of oil can significantly increase costs.
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Manufacturing delays or unexpected transportation delays can also cause us to rely more
heavily on airfreight to achieve timely delivery to our customers, which significantly increases freight
costs and impacts our carbon-dioxide reduction targets negatively. Price fluctuations, raw material
inventory capacity restrictions and extended lead times in our supply chains reduce our ability to react to
variances in our inventory forecasts and limit our operational flexibility. Our goal to reduce the carbon
dioxide-footprint of our Company may cause us to forgo airfreight transport completely, or may result in
increased freight and transportation costs. In addition, any disruptions or reductions of our shipments
made through airfreight may increase shipment times. Any of these fluctuations may increase our cost of
products and have an adverse effect on our profit margins, business, results of operations, financial
(iii) Third-party partners and suppliers
Our financial success may be impacted by the strength of our relationships with our retail
partners and is dependent on the success of these retail partners.
Our financial success is dependent on our retail partners continuing to carry our products and
the success of these partners. A substantial amount of our sales are made through our retail partners,
either directly or indirectly, who may decide to emphasize products from our competitors, to redeploy
their retail floor space to other product categories, or to take other actions that reduce or discontinue
their purchases of our products. We do not have long-term contracts with any of our retail partners, and
sales to our retail partners are generally on an order-by-order basis and are subject to rights of
cancellation and rescheduling by the partner. If we cannot fill our retail partners’ orders in a timely
manner, the sales of our products and our relationships with those partners may suffer, and this could
have a material adverse effect on our ability to grow our product lines and our results of operations.
Although we believe that our business relationships with our retail partners are satisfactory, we
cannot assure you that these business relationships will continue to generate satisfactory sales in the
future. If any of our major retail partners experiences a significant downturn in their business or fails to
remain committed to our products or brand, then these partners may reduce or discontinue purchases
from us, which could adversely impact our business. Additionally, if any of our partners experience a
significant downturn this could lead to potential losses given that we grant certain credit limits to our
partners.
Many of our retail partners compete with each other, and if they perceive that we are offering
their competitors better pricing and support, they may reduce or discontinue purchases of our products.
In addition, we compete directly with our retail partners by selling our products to consumers through
our DTC channel. If our retail partners believe that our DTC channel diverts sales from their stores, this
may weaken our relationships with our partners and cause them to reduce or discontinue purchases of
our products. In addition, if we fail to accurately identify the needs of our partners, our partners fail to
accept new products or product line expansions or attribute premium value to our new or existing
products or product line expansions relative to competing products or if we fail to obtain shelf space
from our retail partners (whether by our competitors introducing new products or otherwise), our sales,
business, results of operations and financial condition may be adversely impacted.
The operations of many of our suppliers and third-party manufacturers are subject to additional
risks that are beyond our control and that could harm our business, financial condition and
results of operations.
Almost all of our manufacturing partners and raw material suppliers are located outside the
United States. In addition, we work with selected third-party distributors, especially in the initial stages
of expansion for highly complicated products and in new markets. Background checks on third parties
and any "Know Your Customer" processes for negotiating and entering contracts with key
counterparties may not always identify all risks associated with such parties, including risks of
inadvertently engaging with parties with criminal backgrounds or ongoing legal proceedings, such as
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cases involving child and forced labor, health, safety, and environmental (HSE) violations, bribery,
corruption, and sanctions. Moreover, entering into business relationships with third parties involved in
lawsuits or criminal cases, or that are not compliant with local and international laws, could adversely
affect our business performance and brand reputation, and because we ultimately do not control those
third parties, we are subject to additional risks as a result of such relationships. In 2023, 90% of our
footwear products were produced in Vietnam and 10% of our footwear products were produced in
Indonesia.
Moreover, in 2023 approximately 61% of our apparel and accessories units produced were
manufactured in Vietnam, 26% in Turkey, 7% China, 4% in Slovenia and 2% in Portugal. All of our
products are manufactured by third party manufacturers. As a result of our international suppliers, we
are subject to risks associated with doing business in multiple jurisdictions, including:
• political unrest, international or other conflicts, terrorism, labor disputes and economic
instability resulting in the disruption of trade from foreign countries in which our products
are manufactured;
• consumer boycotts due to ethical, environmental or political issues in certain countries we
do business with, such as for example, human rights and labor concerns in Asia, or
product-related environmental concerns;
• compliance with existing and new laws and regulations, including those relating to labor
conditions and workplace safety, environmental protection, chemical regulation, quality and
safety standards, imports, duties, taxes and other charges on imports, as well as trade
restrictions and restrictions on currency exchange or the transfer of funds;
• reduced protection for intellectual property rights, including patent and trademark
protection, in some countries;
• disruptions or delays in shipments, global container and capacity shortages, or port
congestion such as the accident in the Suez Canal in 2021 that disrupted container
shipments and supply chains globally; and
• changes in local economic conditions in countries where our manufacturers, suppliers or
customers are located.
We also face risks from potential employment shortages for our supply operations as potential
employees in certain geographies, including Vietnam, China and Indonesia, pursue opportunities outside
of our and our suppliers’ industries. Any potential employment shortages may increase costs for our
supplier and manufacturing partners and may limit our ability to scale our warehouse and factory
operations efficiently. Increased costs in production may limit our profitability and may adversely impact
our business, results of operations and financial condition.
These and other factors beyond our control could interrupt our suppliers’ production in offshore
facilities, influence the ability of our suppliers to export our products cost-effectively or at all and inhibit
our suppliers’ ability to procure certain materials, any of which could harm our business, financial
condition, results of operations and the price of our Class A ordinary shares.
We rely on third-party suppliers to provide fabrics and other subcomponents for and to produce
our footwear, apparel and accessories, and we have limited control over them and may not be
able to obtain quality products on a timely basis or in sufficient quantity.
We do not manufacture our products or the raw materials used in our products and rely instead
on third-party suppliers and contract manufacturers. Many of the specialty fabrics used in our products
are technically advanced textile products developed by third parties and may be available from only one
or a very limited number of sources. For example, our engineered warp knitting textiles, which are
included in many of our products, are supplied to the manufacturers we use by a few major producers in
Vietnam, China, Taiwan and Korea. In 2023, all of our products were produced by less than 25
manufacturing suppliers. In addition, in 2023, 90% of our footwear products were manufactured in
Vietnam, and some of our apparel styles were purchased from only a single manufacturer. These factors
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increase the risk of supply disruption and cost inflation, and our efforts to expand our supplier base may
fail or be delayed.
If we experience significant increased demand, or need to replace an existing manufacturer,
there can be no assurance that additional supplies of fabrics, other subcomponents or raw materials or
additional manufacturing capacity will be available when required on terms that are acceptable to us, or
at all, or that any supplier or manufacturer would allocate sufficient capacity to us in order to meet our
requirements or fill our orders in a timely manner or at all. We allocate production orders among our
suppliers based on the contractor’s capability, capacity and cost, but there is no assurance that we will
be able to do so efficiently and effectively or that we will be able to utilize capable contractors that have
capacity at reasonable costs. Even if we are able to expand existing, or find new, manufacturing or
fabric and other subcomponent sources, we may encounter delays in production and added costs as a
result of the time it takes to train our suppliers and manufacturers in our methods, products and quality
control standards. Delays related to supplier changes could also arise due to an increase in shipping
times if new suppliers are located farther away from our markets or from other participants in our supply
chain. Any delays, interruption or increased costs in the supply of fabric and other subcomponents or
manufacturing of our products could have an adverse effect on our ability to meet customer demand for
our products and could result in lower net sales and income from operations, both in the short and long
term.
In addition, there can be no assurance that our suppliers and manufacturers will continue to
provide fabrics, other subcomponents and raw materials or manufacture products that are consistent
with our standards. We have occasionally received, and may in the future continue to receive, shipments
of products that fail to conform to our quality control standards. If this occurs, unless we are able to
obtain replacement products in a timely manner, we risk the loss of net sales resulting from the inability
to sell those products and related increased administrative and shipping costs. Further, as we continue
our journey to eliminate petroleum-based materials, there is an increased use of recycled materials and
other innovative new and sustainable materials. For example, our Cloudneo shoe is designed to be
recycled, and made with over 50% bio-based material derived from castor beans. The use of innovative
and sustainable materials without a long history of manufacture by our third-party suppliers increases
the risk of higher manufacturing costs or that products that are manufactured may not be consistent
with our standards.
We may fail to find suitable partners to expand outside the United States and the EU and this may
cause our growth strategy to suffer and may harm our net sales and results of operations.
As part of our growth strategy, we plan to expand our distribution network and sales of our
products into new locations outside of the United States and the EU. Our successful expansion and
operation of new stores outside the United States and the EU will depend on our ability to find suitable
partners and to successfully implement and manage joint relationships. Additionally, granting credit
limits to our partners poses credit risks. As such, if our partners experience financial difficulties, this
could lead to financial losses, disruption of cash flows, and potential write-offs of accounts receivable.
Additionally, dependence on a few key customers or wholesale partners in certain markets increases
vulnerability to market fluctuations and industry-specific challenges. In 2023, we had distribution
agreements with 22 partners distributing to 86 markets. Failure to find sufficient or capable partners in a
particular geographic region may delay the rollout of our products in that area. If we are unable to find
suitable partners through distribution relationships, our growth strategy will suffer and our net sales,
results of operations and the price of our Class A ordinary shares could be harmed.
(iv) Human capital
Our success is substantially dependent on the continued service of our senior management and
broader leadership team.
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Our success is substantially dependent on the continued service of our senior management,
including the extended founder team, our board of directors and broader leadership team. The loss of
the services of key individuals of our senior management, board of directors and broader leadership
team could make it more difficult to successfully operate our business and achieve our business goals.
We also may be unable to retain existing management, technical, sales and client support personnel that
are critical to our success, which could harm our customer and employee relationships, result in loss of
key information, expertise or know-how or cause us to incur unanticipated recruitment, training and
other costs, which could in turn harm our business, operating results, financial condition and the price of
Laws and regulations on executive compensation, including legislation in our home country,
Switzerland, may restrict our ability to attract, motivate and retain the required level of qualified
personnel. In Switzerland, legislation affecting public companies is in force that, among other things, (i)
imposes an annual binding shareholders’ “say on pay” vote with respect to the compensation of our
executive committee and board of directors, (ii) generally prohibits severance, advances, transaction
premiums and similar payments to members of our executive committee and board of directors, and (iii)
requires companies to specify certain compensation-related matters in their articles of association, thus
requiring them to be approved by a shareholders’ vote.
We have not obtained key person life insurance policies on any members of our senior
management and broader leadership teams. As a result, we would not be protected against the
associated financial loss if we were to lose the services of members of our senior management and
broader leadership teams.
If we are unable to attract, assimilate and retain employees, we may not be able to grow or
successfully operate our business.
Our success has largely been the result of significant contributions by our employees, including
members of our current senior management, broader leadership and product design teams. However, to
be successful in continuing to grow our business, we will need to continue to attract, assimilate, retain
and motivate highly talented individuals with a diverse range of skills and experience. Certain
geographies in which we operate, including the United States, have experienced historically strong labor
markets, which complicates our efforts to attract and retain new employees, and may also cause us to
fail to retain existing employees. Competition for employees in our industry is intense and we have from
time-to-time experienced difficulty in attracting the personnel necessary to support the growth of our
business, and we may experience similar difficulties in the future. Moreover, we have experienced
challenges obtaining work permits for potential employees, including in Switzerland and the EU, which
may continue to pose challenges. These problems could be further exacerbated as we embark on our
strategy of significantly expanding our business in the United States and elsewhere over the next few
years. In addition, if we fail to mitigate labor disputes, fail to properly hire and dismiss employees as
needed or fail to comply with labor laws, which differ by location and jurisdiction and are rapidly
changing, our risk of litigation may increase, which would cause us to incur additional costs. If we are
unable to attract, assimilate and retain additional employees with the necessary skills, we may not be
able to grow or successfully operate our business, and our business, results of operation, financial
condition and the price of our Class A ordinary shares may be adversely impacted.
(v) Climate
Climate related risks such as extreme weather conditions and natural disasters could negatively
impact our operations, operating results and financial condition. Additionally, the operations of
many of our suppliers and third-party manufacturers, warehouses or distribution centers are
subject to additional environmental risks that are beyond our control and that could harm our
business, financial condition and results of operations.
Shifts in weather patterns or extreme weather conditions, including as a result of climate
change, in the areas in which our retail stores, employees, suppliers, manufacturers, customers,
warehouses or distribution centers, headquarters and vendors are located could adversely affect our
operating results and financial condition. The emergence of longer summers and shorter winters poses
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challenges for sales forecasting and planning, especially for seasonal items. The usual predictability of
demand based on historical weather patterns is becoming less reliable. This uncertainty may impact
inventory management and procurement as we strive to adapt to these changing conditions. Moreover,
natural disasters such as earthquakes, hurricanes and tsunamis, whether occurring in Switzerland, the
United States or elsewhere, and their related consequences and effects, including energy shortages and
public health issues, have in the past temporarily disrupted, and could in the future disrupt, our
operations, the operations of our vendors, manufacturers, warehouses or distribution centers and other
suppliers or have in the past resulted in and could in the future result in economic instability (without
adequate or any recourse on insurance coverage) that may negatively impact our operating results and
financial condition. In particular, if a natural disaster were to occur in an area in which we or our
suppliers, manufacturers, customers, warehouses or distribution centers and vendors are located, our
continued success would depend, in part, on the safety and availability of the relevant personnel and
facilities and proper functioning of our or third parties’ computer, telecommunication and other systems
and operations. In addition, a severe weather event could have an adverse impact on consumer
spending, which could in turn result in a decrease in sales of our products. In addition, the physical
changes prompted by climate change could result in changes in regulations or consumer preferences,
which could in turn affect our business, operating results and financial condition. For example, there has
been increased focus by governmental and non-governmental organizations, customers, employees and
other stakeholders on products that are sustainably made and other sustainability matters, including
responsible sourcing and deforestation, the use of plastic, energy and water, the recyclability or
recoverability of packaging and materials transparency, any of which may require us to incur increased
costs for additional transparency, due diligence and reporting. In addition, governmental authorities in
various countries have proposed, and are likely to continue to propose, legislative and regulatory
initiatives to reduce or mitigate the impacts of climate change on the environment. Various countries and
regions are following different approaches to the regulation of climate change, which could increase the
complexity of, and potential cost related to complying with, such regulations. Further, if we are unable to
find alternative suppliers, replace capacity at key manufacturing or distribution locations or quickly repair
damage to our IT systems or supply systems, we could be late in delivering, or be unable to deliver at all,
products to our customers. These events could result in reputational damage, lost sales, cancellation
charges or markdowns, all of which could have an adverse effect on our business, results of operations,
All of our products are manufactured by third-party manufacturers. While we are conscious and
strategic with our choices of our business partners and require, as part of our supply contracts,
compliance with our Supplier Code of Conduct and our standards, we do not control our manufacturing
suppliers or their business practices. Accordingly, we cannot guarantee their compliance with our
guidelines (e.g. emissions, wastewater, or harmful chemical management) or applicable laws. A failure
by our suppliers to comply with such requirements could, in turn, lead to fines, penalties or litigation,
reduced sales by us as a result of recalls or adverse consumer reactions, and damage to our brand and
reputation or cause us to seek alternative suppliers, which could increase our costs and result in delayed
delivery of our products, product shortages or other disruptions of our operations.
Although we have announced sustainability-related goals and targets, there can be no
assurance that our stakeholders will agree with our strategies, and any perception, whether or not valid,
that we have failed to achieve, or to act responsibly with respect to, such matters or to effectively
respond to new or additional legal or regulatory requirements regarding climate change, could result in
adverse publicity and adversely affect our business and reputation. Execution of these strategies and
achievement of our goals is subject to risks and uncertainties, many of which are outside of our control.
These risks and uncertainties include, but are not limited to, our ability to execute our strategies and
achieve our goals within the currently projected costs and the expected timeframes; the availability and
cost of raw materials and renewable energy; unforeseen production, design, operational and
technological difficulties; the outcome of research efforts and future technology developments, including
the ability to scale projects and technologies on a commercially competitive basis such as carbon
sequestration and/or other related processes; compliance with, and changes or additions to, global and
regional regulations, taxes, charges, mandates or requirements relating to greenhouse gas emissions,
carbon costs or climate-related goals; adapting products to customer preferences and customer
acceptance of sustainable supply chain solutions; and the actions of competitors and competitive
pressures. As a result, there is no assurance that we will be able to successfully execute our strategies
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and achieve our sustainability-related goals, which could damage our reputation and customer and other
stakeholder relationships and have an adverse effect on our business, results of operations and financial
condition.
We have committed to CO2 reduction targets that are approved by the Science Based Targets
initiative (SBTi). If we are unable to achieve the CO2 reduction targets that we have committed to
achieve, we will face reputational harm, which in turn could have an adverse effect on our business,
Increased scrutiny from investors, customers and others regarding our environmental, social,
governance, or sustainability responsibilities could result in additional costs or risks and
adversely impact our reputation, employee retention, and willingness of customers and suppliers
to do business with us.
Investor advocacy groups, certain institutional investors, investment funds, other market
participants, stockholders, current and prospective employees, and customers have focused
increasingly on the ESG or "sustainability" practices of companies, including those associated with
climate change. If our sustainability practices do not meet investor or other industry stakeholder
expectations and standards, which continue to evolve, our brand, reputation and employee retention
may be negatively impacted based on an assessment of our ESG practices. It is possible that
stakeholders may not be satisfied with our ESG practices or the speed of their adoption. We could also
incur additional costs and require additional resources to monitor, report, and comply with various ESG
practices. Further, our failure, or perceived failure, to meet the standards included in any sustainability
disclosure could negatively impact our reputation, employee retention, and the willingness of our
customers and suppliers to do business with us.
Additionally, customers and investors increasingly prioritize businesses that are transparent
about their operations, particularly regarding environmental sustainability. Failure to recognize and
respond to these expectations may result in a negative impact on the Company's market share and
revenue.
III. Risks Related to our Intellectual Property and Information Technology
(i) Protection of intellectual property and litigation
If we are unable to obtain, maintain, protect and enforce our intellectual property rights for the
products we develop, or if the scope of our intellectual property protection is not sufficiently
broad, others may be able to develop and commercialize products substantially similar to ours,
and our business may be adversely affected.
Our intellectual property is an essential asset of our business. Failure to adequately protect our
intellectual property rights could result in our competitors offering similar products, potentially resulting
in the loss of our competitive advantage and a decrease in our net sales, which would adversely affect
our business prospects, financial condition and results of operations. We place considerable emphasis
on technological innovation, including our proprietary CloudTec and Speedboard technologies. We rely
on a combination of intellectual property rights, such as patents, trademarks, design rights, trade secrets
and domain names, in addition to confidentiality procedures and contractual provisions to establish,
maintain, protect and enforce our rights in our brand, technologies, proprietary information and
processes.
For example, we rely heavily upon our trademarks and related domain names and distinctive
logos to market our premium brand and to build and maintain brand loyalty and recognition. Without
adequate protection for our trademarks and trade names, we will not be able to build name recognition
in our markets of interest and our business may be adversely affected. Effective trademark protection
may not be available or may not be sought in every country in which our products are made available,
and contractual disputes may affect the use of marks governed by private contract. Our registered or
unregistered trademarks or trade names may be challenged, infringed, circumvented, declared generic
or determined to be dilutive of or infringing on other trademarks, or may lapse. Further, at times,
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competitors may adopt trade names or trademarks similar to ours, thereby impeding our ability to build
brand identity and possibly leading to market confusion. In addition, there could be potential trade name
or trademark infringement claims brought by owners of other trademarks or trademarks that incorporate
variations of our registered or unregistered trademarks or trade names. We have in the past entered, and
may in the future enter, into trademark co-existence agreements to settle such claims. Such agreements
may restrict the ways in which we are permitted to obtain, maintain, protect and enforce certain
trademark rights. Over the long term, if we are unable to establish name recognition based on our
trademarks and trade names, then we may not be able to compete effectively and our business may be
adversely affected. Similarly, not every variation of a domain name may be available or be registered,
even if available. The occurrence of any of these events could result in the erosion of our brand and limit
our ability to market our brand using our various domain names, as well as impede our ability to
effectively compete against competitors with similar products or technologies.
Additionally, we rely on patent laws for the protection of our products and product components
such as our outsole, CloudTec, upper, Speedboard and lacing technologies. Any patents that may issue
in the future from our pending or future patent applications may not provide us with competitive
advantages, may be of limited territorial reach and may be held invalid or unenforceable if successfully
challenged by third parties, which may lead to increased competition to our business, which could have
a material adverse effect on our business, financial condition, results of operations and prospects. As
our patents expire, the scope of our patent protection will be reduced for certain of our patented
technology in those jurisdictions where such protection has existed, which may reduce or eliminate any
competitive advantage afforded by our patent portfolio for products utilizing the protected technology or
application in those jurisdictions. Additionally, certain of our patents are limited to certain jurisdictions
and do not cover all of our key markets. As a result, our patent portfolio may not provide us with
sufficient rights to exclude others from commercializing products similar or identical to ours.
Furthermore, the issuance of a patent is not conclusive as to its inventorship, scope, validity or
enforceability, and we may become party to adversarial proceedings regarding our patent portfolio or
the patents of third parties. Such proceedings could include supplemental examination or contested
post-grant proceedings such as review, reexamination, interference or derivation proceedings
challenging our patent rights. It is also possible that third parties, including our competitors, may obtain
patents relating to technologies that overlap or compete with our technology. If third parties obtain
patent protection with respect to such technologies, they may assert that our technology infringes their
patents and seek to charge us a licensing fee or otherwise preclude the use of certain of our
technologies.
Any successful third-party challenge to our patents could result in the unenforceability or
invalidity of such patents, which may lead to increased competition to our business, which could harm
our business. In addition, if the breadth or strength of protection provided by our patents and patent
applications is threatened, regardless of the outcome, it could dissuade companies from collaborating
with us to license, develop or commercialize current or future products.
We also rely on agreements under which we contract to own, or license rights to use, intellectual
property developed by employees, contractors and other third parties. While we seek to enter into
agreements with all of our employees who develop intellectual property during their employment to
assign the rights in such intellectual property to us, we may fail to enter into such agreements with all
relevant employees, such agreements may be breached or may not be self-executing, and we may be
subject to claims that our employees have misappropriated the trade secrets or other intellectual
property or proprietary rights of their former employers or other third parties.
In addition, while we generally enter into confidentiality, intellectual property assignment and
non-compete agreements with our employees and third parties, as applicable, to protect our trade
secrets, know-how, business strategy and other proprietary information, such confidentiality agreements
could be breached and our proprietary information could be disclosed, and we may not be able to
obtain adequate remedies for such breaches. These agreements also may not provide meaningful
protection for our trade secrets and know-how related to our products in the event of unauthorized use
or disclosure or other breaches of the agreements, and we may not be able to prevent such
unauthorized disclosure, which could adversely impact our ability to establish or maintain a competitive
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advantage in the market. If we are required to assert our rights against such parties, it could result in
significant cost and distraction. Depending on the parties involved in such a breach, the available
remedies may not provide adequate compensation for the value of the proprietary information disclosed
to a third party.
We cannot guarantee that our efforts to obtain and maintain intellectual property rights are
adequate, that we have secured, or will be able to secure, appropriate permissions or protections for all
of the intellectual property rights we use or rely on. Furthermore, even if we are able to obtain any
intellectual property rights, any such intellectual property rights may be challenged, invalidated,
circumvented, infringed, misappropriated or otherwise violated. Any challenge to our intellectual
property rights could result in them being narrowed in scope or declared invalid or unenforceable. In
addition, other parties may also independently develop products and technologies that are substantially
similar or superior to ours and we may not be able to stop such parties from using such independently
developed products or technologies from competing with us. If we fail to obtain and maintain our
intellectual property rights adequately, we may lose an important advantage in the markets in which we
compete.
Intellectual property rights in certain elements of our products and manufacturing technology are
owned or controlled by our suppliers and are generally not unique to us. Our ability to obtain intellectual
property protection for our products is therefore limited. As a result, our current and future competitors
are able to manufacture and sell products with performance characteristics, designs and styling similar
to our products. Because many of our competitors have significantly greater financial, distribution,
marketing, and other resources than we do, they may be able to manufacture and sell products based
on ours at lower prices than we can. If our competitors sell products similar to ours at lower prices, our
financial results could suffer.
Our intellectual property rights and the enforcement or defense of such rights may be affected
by developments or uncertainty in laws and regulations relating to intellectual property rights. Some of
our brands, trademarks and logos might not be sufficiently distinctive for robust legal protection.
Moreover, many companies have encountered significant problems in protecting and defending
intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly
certain developing countries, do not favor the enforcement of patents, design rights, trademarks, trade
secrets and other intellectual property protection, which could make it difficult for us to stop the
infringement, misappropriation or other violation of our intellectual property or marketing of competing
products in violation of our intellectual property rights generally. Proceedings to enforce our patent rights
in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other
aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and
our patent applications at risk of not issuing and could provoke third parties to assert claims against us.
We also may be forced to bring claims against third parties to determine the ownership of what we
regard as our intellectual property or to enforce our intellectual property against its infringement,
misappropriation or other violations by third parties. However, the measures we take to protect our
intellectual property from unauthorized use by others may not be effective and there can be no
assurance that our intellectual property rights will be sufficient to protect against others offering
products that are substantially similar or superior to ours and that compete with our business. In
intellectual property-related proceedings in court or before patent, trademark and copyright agencies,
the defendant could claim that our asserted intellectual property is invalid or unenforceable and the
court may agree that our asserted intellectual property is invalid or unenforceable, in which case we
could lose valuable intellectual property rights. The outcome following such intellectual property-related
proceedings is often unpredictable. In addition, even if we are successful in enforcing our intellectual
property against third parties, the damages or other remedies awarded, if any, may not be commercially
meaningful. Regardless of whether any such proceedings are resolved in our favor, such proceedings
could cause us to incur significant expenses and could distract our personnel from their normal
responsibilities. In addition, if the strength of our intellectual property portfolio is threatened, regardless
of the outcome, it could dissuade others from collaborating with us to license intellectual property, or
develop or commercialize current or future products. Accordingly, our efforts to enforce our intellectual
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property rights around the world may be inadequate to obtain a significant commercial advantage from
the intellectual property that we develop or license.
Over time we may increase our investment in protecting our intellectual property through
additional patent, trademark and other intellectual property filings, which could be expensive and time
consuming. Effective patent, trademark, trade secret, design right, copyright and other intellectual
property protection is expensive to develop and maintain, both in terms of initial and ongoing registration
requirements and the costs of defending our rights. Even so, these measures may not be sufficient to
offer us meaningful protection. Furthermore, monitoring unauthorized use of our intellectual property is
difficult and costly. From time to time, we seek to analyze our competitors’ products, and may in the
future seek to enforce our rights against potential infringement, misappropriation or other violation.
However, the steps we have taken to protect our intellectual property rights may not be adequate to
prevent infringement, misappropriation or other violations of our intellectual property. We may not be
able to detect unauthorized use of, or take appropriate steps to enforce, our intellectual property rights,
or pursue all counterfeiters who may seek to benefit from our brand. Any inability to meaningfully protect
our intellectual property rights could result in harm to our ability to compete and reduce demand for our
products. Moreover, our failure to develop and properly manage new intellectual property could
adversely affect our market positions, business opportunities and the price of our Class A ordinary
shares.
Third parties may initiate legal proceedings alleging that we are infringing, misappropriating or
otherwise violating their intellectual property rights, the outcome of which would be uncertain
and could have a material adverse effect on our business, financial condition and results of
operations.
Our commercial success depends on our avoiding infringement, misappropriation or other
violations of the intellectual property rights of third parties. As we face increasing competition, and to the
extent we gain greater public recognition, the possibility of intellectual property rights claims against us
grows. Any claim or litigation alleging that we have infringed, misappropriated or otherwise violated
intellectual property rights of third parties, with or without merit, and whether or not settled out of court
or determined in our favor, could be time consuming and costly to address and resolve, and could divert
the time and attention of our management and technical personnel. Such claims may be made by third
parties seeking to obtain a competitive advantage, including non-practicing entities or individuals with
no relevant product sales, and, therefore, our own issued and pending patents, registered designs,
registered trademarks and other intellectual property rights may provide little or no deterrence to these
rights holders in bringing intellectual property rights claims against us. Additionally, some third parties
have substantially greater human and financial resources than we do and are able to sustain the costs
and workload of complex intellectual property litigation to a greater degree and for longer periods of
time than we could. The outcome of any litigation is inherently uncertain, and there can be no
assurances that favorable final outcomes will be obtained in all cases. In addition, third parties may
seek, and we may become subject to, preliminary or provisional rulings in the course of any such
litigation, including potential preliminary injunctions requiring us to change our products or even cease
the commercialization of our products entirely.
We may decide to settle such lawsuits and disputes on terms that are unfavorable to us.
Similarly, if any litigation to which we are a party is resolved adversely, we may be subject to an
unfavorable judgment that may not be reversed upon appeal, including being subject to a permanent
injunction and being required to pay substantial monetary damages, including treble damages and
attorneys’ fees, if we are found to have willfully infringed a party’s intellectual property rights. The terms
of such a settlement or judgment may require us to cease some or all of our operations or pay
substantial amounts to the other party. Even if we have an agreement to indemnify us against such
costs, the indemnifying party may be unable or unwilling to uphold its contractual obligations. Further,
our liability insurance may not cover potential claims of this type adequately or at all. In addition, we may
have to seek a license to continue practices found to be in violation of a third party’s rights. If we are
required, or choose to enter into royalty or licensing arrangements, such arrangements may not be
available on reasonable terms, or at all, and may significantly increase our operating costs and
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expenses. Such arrangements may also only be available on a non-exclusive basis, such that third
parties, including our competitors, could have access to use the same intellectual property to compete
with us. We may also have to redesign our products so they do not infringe, misappropriate or otherwise
violate third-party intellectual property rights, which may not be possible or may require substantial
monetary expenditures and time, during which our products may not be available for commercialization
or use. If we cannot redesign our products in a non-infringing manner or obtain a license for any
allegedly infringing aspect of our business, we would be forced to limit our products and may be unable
to compete effectively.
In addition, in any intellectual property proceeding against us or that we assert against a third
party, there could be public announcements of the results of hearings, motions or other interim
proceedings or developments, and if securities analysts or investors perceive these results to be
negative, it could have a material adverse effect on the price of our Class A ordinary shares. Such
litigation or proceedings could substantially increase our expenses and reduce the resources available
for development activities or any future sales, marketing or distribution activities. Furthermore, because
of the substantial amount of discovery required in connection with intellectual property litigation, there is
a risk that some of our confidential information could be compromised by disclosure during this type of
litigation. Any of the foregoing, and any unfavorable resolution of such disputes and litigation, could have
an adverse effect on our business, financial condition, results of operations and prospects.
We license intellectual property rights from third-party owners. If we fail to comply with our
obligations in any current or future agreements under which we license intellectual property
rights from third parties or otherwise experience disruptions to our business relationships with
our licensors, we could lose license rights that are important to our business.
We are and may become party to license agreements with third parties to obtain the rights to
certain brands or to allow commercialization of our products. Such agreements may impose numerous
obligations, such as development, payment, royalty, sublicensing, insurance, enforcement and other
obligations on us in order to maintain the licenses. In spite of our best efforts, our licensors might
conclude that we have materially breached such license agreements and might therefore terminate the
license agreements, thereby removing or limiting our ability to use certain brands or develop and
commercialize products covered by these license agreements. For example, we do not own “THE
ROGER” brand and are dependent on a license from Tenro AG for certain trademarks and other rights
related to Roger Federer’s name, image and likeness. If our license agreement with Tenro AG were to
terminate for any reason, we may be required to cease the development, advertisement, promotion and
sale of certain of our products. Any termination of our licenses could result in the loss of significant
rights and could harm our ability to commercialize our products, which could have a material adverse
effect on our sales, profitability or financial condition.
Disputes may also arise between us and our licensors regarding intellectual property subject to a license
agreement, including:
• the scope of rights granted under the license agreement and other interpretation-related
issues;
• our compliance with reporting, financial or other obligations under the license agreement;
• the amounts of royalties or other payments due under the license agreement;
• whether and the extent to which we infringe, misappropriate or otherwise violate intellectual
property rights of the licensor that are not subject to the license agreement;
• our right to sublicense applicable rights to third parties;
• our right to transfer or assign the license; and
• the ownership of intellectual property and know-how resulting from the joint creation or use
of intellectual property by our future licensors and us and our partners.
If we do not prevail in such disputes, we may lose any or all of our rights under such license
agreements, experience significant delays in the development and commercialization of our products
and technologies, or incur liability for damages, any of which could have a material adverse effect on our
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business prospects, financial condition and results of operations. In addition, we may seek to obtain
additional licenses from our licensors, and, in connection with obtaining such licenses, we may agree to
amend our existing licenses in a manner that may be more favorable to the applicable licensor, including
by agreeing to terms that could enable third parties, including our competitors, to receive licenses to a
portion of the intellectual property that is subject to our existing licenses and to compete with our
products.
In addition, the agreements under which we may license intellectual property from third parties
are likely to be complex, and certain provisions in such agreements may be susceptible to multiple
interpretations. The resolution of any contract interpretation disagreement that may arise could narrow
what we believe to be the scope of our rights to the relevant intellectual property, or increase what we
believe to be our financial or other obligations under the relevant agreement, either of which could have
a material adverse effect on our sales, business, financial condition or results of operations.
Moreover, if disputes over intellectual property that we license from third parties prevent or impair our
ability to maintain our license agreements on acceptable terms, we may be unable to successfully
commercialize the affected products, which could have a material adverse effect on our sales, business,
financial conditions or results of operations.
(ii) Information technology security, laws, and systems
A security breach, including a cybersecurity incident or other disruption to our IT systems could
result in adverse effects on the confidentiality, integrity, or availability of our IT systems or any
information residing therein, including the loss, theft, misuse, unauthorized disclosure, or
unauthorized access of customer, supplier, or sensitive company information or could disrupt our
operations. Such cybersecurity threats could damage our relationships with customers, suppliers
or employees, expose us to litigation or regulatory proceedings, or harm our reputation, any of
which could materially adversely affect our business strategy, financial condition or results of
operations.
Our business involves the storage, transmission and other processing of a significant amount of
personal, confidential, and sensitive information, including the personal information of our customers
and employees, credit card information, information relating to customer preferences, and our
proprietary financial, operational and strategic information. In addition, the utilization of various tools and
platforms by teams within the organization involves the storage of a significant amount of confidential
information, encompassing sensitive data such as supplier base, new product designs, product costs,
etc. The potential exposure of such proprietary information could impact our business, including but not
limited to competitive disadvantage, as unauthorized disclosure of proprietary information could provide
competitors with insights into our strategic initiatives, product development plans, and supplier
relationships, resulting in a loss of competitive advantage. Additionally, there is the risk of reputational
damage, as public exposure of confidential data could affect our reputation. Furthermore, the risk of loss
of intellectual property is significant, as leakage of new product designs or proprietary technologies
could result in unauthorized replication or exploitation by third parties, leading to diminished market
share and revenue streams. The protection of this information is vitally important to us as the loss, theft,
misuse, unauthorized disclosure, or unauthorized access of such information could lead to significant
reputational or competitive harm, result in litigation involving us or our business partners, expose us to
regulatory proceedings, and cause us to incur substantial liabilities, fines, penalties, or expenses. As a
result, we believe our future success and growth depends, in part, on the ability of our key business
processes and systems, including our IT and global communication systems, to prevent the theft, loss,
misuse, unauthorized disclosure, or unauthorized access of this personal, confidential, and sensitive
information, and to respond quickly and effectively if data security incidents do occur. In light of these
risks, we acknowledge the critical importance of implementing appropriate data security measures,
including but not limited to encryption protocols, access controls, user training programs, and regular
audits, designed to mitigate the likelihood and impact of confidential information leakage. Furthermore,
appropriate monitoring and evaluation of the efficacy of existing controls and proactive risk management
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strategies are imperative to striving to safeguard our intellectual property and preserve our competitive
position in the market.
The frequency, intensity, and sophistication of cybersecurity incidents, ransom-ware attacks,
and other data security incidents has significantly increased in recent years and, as with many other
businesses, we have experienced, and are continually at risk of being subject to, such attacks and
incidents. Such threats may see their frequency increased, and effectiveness enhanced, by the use of AI.
For example, the sophisticated nature of generative AI could be exploited in cybersecurity incidents,
enhancing threats like convincing phishing campaigns or advanced social engineering tactics. This
necessitates more robust cybersecurity measures, continuous monitoring, and specialized strategies to
counteract these advanced cybersecurity threats. Due to the increased risk of these types of attacks and
incidents, we expend significant resources on IT and data security tools, measures, and processes
designed to protect our IT systems, as well as the personal, confidential, or sensitive information stored
on, transmitted through or otherwise processed by those systems, and to ensure an effective response
to any cybersecurity or data security incident. Despite the implementation of preventative, detective and
reactive security controls, our IT systems are vulnerable to damage or interruption from a variety of
sources, including telecommunications or network failures or interruptions, system malfunction, natural
disasters, epidemics, malicious human acts, terrorism and war. Our ability to effectively manage and
maintain our inventory and to ship products to customers on a timely basis depends significantly on the
reliability of our IT systems. We also use these systems to process financial information and results of
operations for internal reporting purposes and to comply with regulatory financial reporting, legal and tax
requirements. IT systems provided by third parties, such as Microsoft and Salesforce, may also be
difficult to integrate with other tools due to their complexity, resulting in high data inconsistency and
incompatibility, and also face similar cybersecurity threats.
Our IT systems are additionally vulnerable to physical or electronic break-ins, security breaches
from inadvertent or intentional actions by our employees, third-party service providers, contractors,
consultants, business partners, and/or other third parties, from cybersecurity threats by malicious third
parties (including the deployment of harmful malware, ransomware, denial-of-service attacks, social
engineering, and other means to affect service reliability and threaten the confidentiality, integrity, and
availability of information), or other data security incidents. These risks may be exacerbated in the
remote work environment. These risks may also be exacerbated by the complicated supply chains
involved with operating a cloud native environment to support our IT systems. In addition, because the
techniques used to obtain unauthorized access to IT systems are constantly evolving and becoming
more sophisticated, may not be recognized until launched, and can originate from a wide variety of
sources, including outside groups such as external service providers, organized crime affiliates, terrorist
organizations, or hostile foreign governments or agencies, we may be unable to anticipate all types of
cybersecurity threats or implement adequate preventive measures in response.
We have experienced and may in the future experience, whether directly or through our supply
chain or other channels, cybersecurity incidents. While prior incidents have not materially affected our
business strategy, results of operations of financial condition, and although our processes are designed
to help prevent, detect, respond to, and mitigate the impact of such incidents, there is no guarantee that
a future cybersecurity incident would not materially affect our business strategy, results of operations or
financial conditions. Cybersecurity or data security incidents could remain undetected for an extended
period, which could potentially result in significant harm to our systems, as well as unauthorized access
to the information stored on and transmitted by our systems. Even when a security breach is detected,
the full extent of the breach may not be determined immediately. The costs to us to mitigate network
security problems, bugs, viruses, worms, malicious software programs and security vulnerabilities could
be significant and, while we have implemented security measures to protect our systems, our efforts to
address these problems may not be successful. Further, despite our security efforts and training, our
employees may purposefully or inadvertently cause security breaches that could harm our systems or
result in the unauthorized disclosure of or access to information. Any measures we take to prevent
security breaches, whether caused by employees or third parties, have the potential to limit our ability to
complete sales or ship products to our customers, harm relationships with our suppliers, or restrict our
ability to meet our customers’ expectations with respect to their online or retail shopping experience.
A cybersecurity or other data security incident could result in the significant and protracted disruption of
our business such that:
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• critical business systems become inoperable or require a significant amount of time or cost
to restore;
• key personnel are unable to perform their duties or communicate with employees,
customers or third-party partners;
• it results in the loss, theft, misuse, unauthorized disclosure or unauthorized access of
customer, supplier or company information;
• we are prevented from accessing information necessary to conduct our business;
• we are required to make unanticipated investments in equipment, technology or security
measures;
• customers cannot access our e-commerce websites and customer orders may not be
received or fulfilled;
• we become subject to return fraud schemes, reselling schemes and imposter sites
schemes; or
• we become subject to other unanticipated liabilities, costs or claims.
If any of these events were to occur, it could have a material adverse effect on our financial
condition and results of operations and result in harm to our reputation and the price of our Class A
ordinary shares. Furthermore, our disaster recovery or business continuity plan may not adequately
address such disruptions and we may not be able to adequately continue our business or return to
operability within a reasonable period of time in the case of such an occurrence. Recovery of our IT
systems may be additionally hampered where we have outsourced the operation of IT and data storage
to third parties.
In addition, if a cybersecurity or other data incident results in the loss, theft, misuse,
unauthorized disclosure, or unauthorized access of personal, confidential, or sensitive information
belonging to our customers, suppliers, or employees, it could put us at a competitive disadvantage,
result in the deterioration of our customers’ confidence in our brand, cause our suppliers to reconsider
their relationship with our Company or impose more onerous contractual provisions and subject us to
potential litigation, liability, fines and penalties. For example, we could be subject to regulatory or other
actions pursuant to domestic and international privacy laws, including regulations such as the California
Consumer Privacy Act, as amended by the California Privacy Rights Act (“CCPA”), the General Data
Protection Regulation (“GDPR”) in the EU and its equivalent in the United Kingdom ("UK GDPR") and
Swiss data protection laws. This could result in costly investigations and litigation, civil or criminal
penalties, operational changes, and negative publicity that could adversely affect our reputation, as well
as our results of operations and financial condition. For more information regarding risks related to our
data privacy and security practices, see “—Changes in laws or regulations relating to data privacy and
security, or any actual or perceived failure by us to comply with such laws and regulations, or
contractual or other obligations relating to data privacy and security, could lead to government
enforcement actions (which could include civil or criminal penalties), private litigation or adverse publicity
and could have a material adverse effect on our reputation, results of operations, financial condition and
cash flows."
We currently maintain separate cybersecurity insurance. However, any insurance we maintain
now or in the future against risks associated with cybersecurity threats and data incidents may be
insufficient to cover all losses and would not, in any event, remedy damage to our reputation. In addition,
we may face difficulties in recovering any losses from a provider and any losses we recover may be
lower than we initially expect.
We are also reliant on the security practices of our third-party service providers, which may be
outside of our direct control. The services provided by these third parties are subject to the same risk of
outages, other failures and security breaches described above. If these third parties fail to adhere to
adequate security practices, or experience a breach of their systems, the data of our employees,
customers and business associates may be improperly accessed, used or disclosed. In addition, our
providers have broad discretion to change and interpret the terms of service and other policies with
respect to us, and those actions may be unfavorable to our business operations. Our providers may also
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take actions beyond our control that could harm our business, including discontinuing or limiting our
access to one or more services, increasing pricing terms, terminating or seeking to terminate our
contractual relationship altogether, or altering how we are able to process data in a way that is
unfavorable or costly to us. Although we expect that we could obtain similar services from other third
parties, if our arrangements with our current providers were terminated, we could experience
interruptions in our business, as well as delays and additional expenses in arranging for alternative cloud
infrastructure services. Any loss or interruption to our IT systems or the services provided by third
parties could adversely affect our business, financial condition and results of operations. Additionally,
due to the Russia-Ukraine conflict which started in February 2022, there have been publicized
cybersecurity threats to increase hacking activity against the critical infrastructure of any nation or
organization that retaliates against Russia for its invasion of Ukraine. Similarly, cybersecurity threats may
be heightened as a result of the ongoing military conflict between Israel and Hamas. Any such increase
in such attacks on our third-party service providers or other systems could adversely affect our network
systems or other operations. We have measures in place that are designed to detect and respond to
such cybersecurity and data security incidents, but there can be no assurance that our efforts will
prevent or detect such cybersecurity and data security incidents.
Changes in laws or regulations relating to data privacy and security, or any actual or perceived
failure by us to comply with such laws and regulations, or contractual or other obligations relating
to data privacy and security, could lead to government enforcement actions (which could include
civil or criminal penalties), private litigation or adverse publicity and could have a material
adverse effect on our reputation, results of operations, financial condition and cash flows.
We are, and may increasingly become, subject to various laws, directives, industry standards
and regulations, as well as contractual obligations, relating to data privacy and security in the
jurisdictions in which we operate. The regulatory environment related to data privacy and security is
increasingly rigorous, with new and constantly changing requirements applicable to our business, and
enforcement practices are likely to remain uncertain for the foreseeable future. These laws and
regulations may be interpreted and applied differently over time and from jurisdiction to jurisdiction, and
it is possible that they will be interpreted and applied in ways that may have a material adverse effect on
our results of operations, financial condition and cash flows.
In the United States, various federal and state regulators, including governmental agencies like
the Consumer Financial Protection Bureau and the Federal Trade Commission, have adopted, or are
considering adopting, laws and regulations concerning personal information and data security and have
prioritized privacy and information security violations for enforcement actions. Certain state laws may be
more stringent or broader in scope, or offer greater individual rights, with respect to personal information
than federal, international or other state laws, and such laws may differ from each other, all of which may
complicate compliance efforts. For example, the CCPA increases privacy rights for California residents
and imposes obligations on companies that process their personal information. Among other things, the
CCPA requires covered companies to provide disclosures to California consumers and provide such
consumers data protection and privacy rights, including the ability to opt out of certain data-sharing
arrangements of personal information, and the ability to access, delete and correct personal information.
The CCPA provides for civil penalties for violations, as well as a private right of action for certain data
breaches that result in the loss of personal information. This private right of action may increase the
likelihood of, and risks associated with, data breach litigation. Numerous other states have enacted, or
are considering enacting, comprehensive privacy laws and regulations that share similarities with the
CCPA. In addition, laws in all 50 states in the United States require businesses to provide notice to
consumers (and, in some cases, to regulators) whose personal information has been accessed or
acquired as a result of a data breach. State laws are changing rapidly and there is discussion in
Congress of a new comprehensive federal data privacy law to which we would become subject if it is
enacted, which may add additional complexity, variation in requirements, restrictions and potential legal
risks, require additional investment of resources in compliance programs, impact strategies and the
availability of previously useful data and could result in increased compliance costs or changes in
business practices and policies.
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We are also subject to international laws, regulations and standards in many jurisdictions, which
apply broadly to the collection, use, retention, security, disclosure, transfer and other processing of
personal information. For example, the GDPR, which became effective in May 2018, greatly increased
the European Commission’s jurisdictional reach of its laws and added a broad array of requirements for
handling personal data. EU member states are tasked under the GDPR to enact, and have enacted,
certain implementing legislation that adds to or further interprets the GDPR requirements and potentially
extends our obligations and potential liability for failing to meet such obligations. The GDPR, together
with national legislation, regulations and guidelines of the EU member states governing the processing
of personal data, imposes strict obligations and restrictions on the ability to collect, use, retain, protect,
disclose, transfer and otherwise process personal data. In particular, the GDPR includes obligations and
restrictions concerning data transparency and consent, the overall rights of individuals to whom the
personal data relates, the transfer of personal data out of the European Economic Area (“EEA”), security
breach notifications and the security and confidentiality of personal data. The GDPR authorizes fines for
certain violations of up to 4% of global annual net sales or €20 million, whichever is greater. Additionally,
the United Kingdom's decision to leave the EU has created uncertainty with regard to data protection
regulation in the United Kingdom. As of January 1, 2021, we are also subject to the UK GDPR and UK
Data Protection Act of 2018, which retains the GDPR in the United Kingdom's national law. While the UK
GDPR currently imposes substantially the same obligations as the GDPR, the UK GDPR will not
automatically incorporate changes made to the GDPR going forward (which would need to be
specifically incorporated by the United Kingdom government). Moreover, the United Kingdom
government has publicly announced plans to reform the UK GDPR in ways that, if formalized, are likely
to deviate from the GDPR, all of which creates a risk of divergent parallel regimes and related
uncertainty, along with the potential for increased compliance costs and risks for affected businesses.
Recent legal developments in the EU have created further complexity and uncertainty regarding
transfers of personal data from the EEA and the United Kingdom to the United States. Although the
United Kingdom currently has an adequacy decision from the European Commission, such that the
standard contractual clauses ("SCCs") are not required for the transfer of personal data from the EEA to
the United Kingdom, that decision will sunset in June 2025 unless extended and it may be revoked in the
future by the European Commission if the United Kingdom data protection regime is reformed in ways
that deviate substantially from the GDPR. Adding further complexity for international data transfers, in
March 2022, the United Kingdom adopted its own International Data Transfer Agreement for transfers of
personal data out of the United Kingdom to so-called third countries, as well as an international data
transfer addendum that can be used with the SCCs for the same purpose. Moreover, on July 10, 2023
the European Commission adopted an adequacy decision concluding that the United States ensures an
adequate level of protection for personal data transferred from the EEA to the United States under the
EU-U.S. Data Privacy Framework (followed on October 12, 2023 with the adoption of an adequacy
decision in the UK for the UK-US Data Bridge). However, the adequacy decision does not foreclose, and
is likely to face, future legal challenges and the ongoing legal uncertainty may increase our costs and our
ability to efficiently process personal data from the EEA or in the United Kingdom. These recent
developments will require us to review and amend the legal mechanisms by which we make or receive
personal data transfers. As supervisory authorities issue further guidance on personal data export
mechanisms, including circumstances where the SCCs and other mechanisms cannot be used, or start
taking enforcement action, we could suffer additional costs, complaints or regulatory investigations or
fines, or if we are otherwise unable to transfer personal data between and among countries and regions
in which we operate, it could affect the manner in which we do business, the geographical location or
segregation of our relevant operations, and could adversely affect our financial results.
The Swiss Federal Act on Data Protection, or DPA, also applies to the collection and processing
of personal data by companies located in Switzerland, or in certain circumstances, by companies
located outside of Switzerland. On September 1, 2023, the revised DPA entered into force. The revision
aligned the DPA with international rules, which allowed the upholding of the European Commission's
adequacy decision for Switzerland. The revised DPA largely follows the regime provided by the GDPR
with some reliefs and very limited “Swiss finishes”. This may lead to an increase in our costs of
compliance, risk of noncompliance and penalties for noncompliance.
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All of these evolving compliance and operational requirements impose significant costs, such as
costs related to organizational changes, implementing additional protection technologies, training
associates and engaging consultants, which are likely to increase over time. In addition, such
requirements may require us to modify our data processing practices and policies, distract management
or divert resources from other initiatives and projects, all of which could have a material adverse effect
on our results of operations, financial condition and cash flows. Any failure or perceived failure by us to
comply with any applicable federal, state or similar foreign laws and regulations relating to data privacy
and security could result in damage to our reputation and our relationship with our customers, as well as
proceedings or litigation by governmental agencies or customers, including class action privacy litigation
in certain jurisdictions, which could subject us to significant fines, sanctions, awards, penalties or
judgments, any of which could result in costly investigations and litigation, civil or criminal penalties,
operational changes, and negative publicity that could adversely affect our reputation, as well as our
results of operations and financial condition.
We rely on a large number of complex IT systems. The integration of these IT systems may not be
successful. Any failure to operate, maintain and upgrade our IT systems may materially and
adversely affect our operations.
It is critical to our success that retailers, consumers and potential new customers within the
countries we operate in are able to access our online services at all times. We operate on a combination
of shared and individual, central or local IT systems and solutions. Any failure of either central or local IT
systems and functions may disrupt the efficiency and functioning of all our operations. Updates or
changes in the software or hardware technology may lead to failures of communication between our
platforms and customers in the course of the order transmission or other processes. We therefore rely
on a large number of IT systems, such as local network and internet coverage, to manage the entire
process, from the placing of and payment for orders online by customers to the receipt of and
confirmation of those orders by our backend systems, which creates significant complexity and
negatively affects our ability to scale our business and realize cost savings. We also rely on our complex
IT landscape to provide us with quality operation and financial data and any disruption may lead to
inconsistencies, errors, and delays in the reporting of operational and financial information, potentially
compromising decision-making processes, regulatory compliance, and overall operational efficiency.
We have made substantial investments into the development of our IT systems, which form the
back bone of our business operations. Due to the complexity of these IT systems, we cannot rule out
that they may cause or contribute to failures in the order transmission process or may prove less
efficient than anticipated. In addition, a failure of any individual network carrier, IT system or IT provider
would impact our ability to receive and transmit orders or to accept payment for orders. The efficient
operation and scalability of our own IT systems and third-party IT systems is therefore critical to
maintain operations.
We have previously experienced service disruptions, and in the future, we may experience
further service disruptions, outages, or other performance problems due to a variety of factors, including
infrastructure changes, human or software errors, capacity constraints due to an overwhelming number
of users accessing our platform simultaneously, and fraud, denial-of-service attacks or cybersecurity
incidents. In some instances, we may not be able to identify the cause or causes of these performance
problems within an acceptable period of time. It may become increasingly difficult to maintain and
improve the availability of our platform, especially during peak usage times and as customer traffic
increases. If our online marketplace is unavailable when users attempt to access it or does not load as
quickly as customers expect, they may seek other services, and may not return to our online
marketplace as often in the future, or at all. This would harm our ability to attract customers and
decrease the frequency with which customers use our online marketplace. We expect to continue to
make significant investments to maintain and improve the availability of our online marketplace and to
enable rapid releases of new products. To the extent that we do not effectively address capacity
constraints, respond adequately to service disruptions, upgrade our systems as needed or continually
develop our technology and network architecture to accommodate actual and anticipated changes in
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technology, our business, results of operations and the price of our Class A ordinary shares would be
harmed.
The materialization of any of the risks described above could have a material adverse effect on
our assets, financial condition, cash flows and results of operations.
We utilize AI, which could expose us to liability or adversely affect our business.
The adoption of generative AI technologies in our operations introduces distinct risks, notably in
data management and data privacy. No assurance can be provided that our use of such AI technologies
will enhance our products or operations or produce the intended results. These AI systems, capable of
synthesizing customer interactions and generating personalized recommendations could inadvertently
use sensitive data to train future models. If this were to occur within a public model, this raises the
possibility of reputational damage and legal challenges, especially if false or inaccurate information is
disseminated. Additionally, the need for these systems to access extensive datasets heightens the risk
of data breaches, potentially leading to unauthorized disclosure of sensitive customer and company
information. Such breaches could result in identity theft, financial fraud, and non-compliance with data
privacy and security laws and regulations, thereby exposing the Company to regulatory penalties and
legal liabilities. Further, AI algorithms may be flawed, insufficient, of poor quality, reflect unwanted forms
of bias, or contain other errors or inadequacies, any of which may not be easily detectable; AI has been
known to produce false or “hallucinatory” inferences or outputs; AI can present ethical issues and may
subject us to new or heightened legal, regulatory, ethical, or other challenges; and inappropriate or
controversial data practices by developers and end-users, or other factors adversely affecting public
opinion of AI, could impair the acceptance of AI solutions, including those incorporated in our products
and services. If the AI tools that we use are deficient, inaccurate or controversial, we could incur
operational inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse
impacts on our business and financial results. If we do not have sufficient rights to use the data or other
material or content on which the AI tools we use rely, we also may incur liability through the violation of
applicable laws and regulations, third-party intellectual property, privacy or other rights, or contracts to
which we are a party.
In addition, regulation of AI is rapidly evolving worldwide as legislators and regulators are
increasingly focused on these powerful emerging technologies. The technologies underlying AI and its
uses are subject to a variety of laws and regulations, including intellectual property, data privacy and
security, consumer protection, competition, and equal opportunity laws, and are expected to be subject
to increased regulation and new laws or new applications of existing laws and regulations. AI is the
subject of ongoing review by various United States governmental and regulatory agencies, and various
United States states and other foreign jurisdictions are applying, or are considering applying, their
platform moderation, cybersecurity, and data protection laws and regulations to AI or are considering
general legal frameworks for AI. We may not be able to anticipate how to respond to these rapidly
evolving frameworks, and we may need to expend resources to adjust our operations or offerings in
certain jurisdictions if the legal frameworks are inconsistent across jurisdictions. Furthermore, because
AI technology itself is highly complex and rapidly developing, it is not possible to predict all of the legal,
operational or technological risks that may arise relating to the use of AI. In essence, while generative AI
offers significant opportunities for innovation and efficiency in our operations, it also demands stringent
management to ensure the protection of data integrity, customer and employee safety, regulatory
compliance, and the maintenance of our Company's reputation.
IV. Risks Related to Financial, Accounting and Tax Matters
(i) Additional investments in our business

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We plan to primarily use cash from operations to finance our growth strategy, but may need to
raise additional capital that may be required to grow our business, which we may not be able to
raise on terms acceptable to us or at all.
While we intend to primarily finance our growth through the cash flows generated by our
operations, we may need to seek additional capital, potentially through debt or equity financings, to fund
our growth. We cannot assure you that we will be able to raise the needed cash on terms acceptable to
us or at all. In particular, there may be volatility in the financial markets or a lack of investor demand,
which would negatively impact our ability to raise additional capital. In addition, macroeconomic
conditions, such as increased volatility or disruption in the credit markets, could adversely affect our
ability to incur indebtedness. Further, to combat rising inflation, central banks may deploy various
strategies, including increasing interest rates, which may impact our borrowing costs and in turn, our
financial condition should we incur more debt. Financings may be on terms that are dilutive or potentially
dilutive to our shareholders, and the prices at which new investors would be willing to purchase our
securities may be lower than the price per share of our Class A ordinary shares. The holders of any new
securities may also have rights, preferences or privileges which are senior to those of existing holders of
ordinary shares. If we raise additional capital through the sale of equity or convertible debt securities, our
existing shareholders may experience substantial dilution, and the terms of these securities may include
liquidation or other preferences that adversely affect the rights of holders of our Class A ordinary shares.
If new sources of financing are required, but are insufficient or unavailable, we will be required to modify
our growth and operating plans based on available funding, if any, which would harm our profitability,
business, results of operation, financial condition and the price of our Class A ordinary shares.
We have and expect to continue to incur expenses and devote resources and management time
as a result of being a public company, which may negatively impact our financial performance,
our results of operations, cash flows and financial condition.
As a public company, we are subject to laws, regulations and requirements, certain corporate
governance provisions of the Sarbanes-Oxley Act, related regulations of the SEC and the requirements
of the NYSE. Complying with these statutes, regulations and requirements occupies a significant amount
of time of our board of directors and management and significantly increases our costs and expenses as
compared to when we were a private company. For example, as a public company, we have had to
institute a more comprehensive internal controls and financial reporting function, comply with rules
promulgated by the NYSE, prepare and distribute periodic public reports in compliance with our
obligations under the federal securities laws, maintain effective disclosure controls and procedures and
internal controls for financial reporting, and involve and retain to a greater degree outside counsel and
accountants in the above activities. As such, we have incurred and expect to continue to incur
significant legal, accounting, insurance and other expenses as our Company has grown in recent years.
The rules implemented by the SEC, the NYSE, and the securities regulators in Switzerland have required
changes in corporate governance practices of public companies. Compliance with these laws, rules and
regulations has and will continue to substantially increase our expenses, including our legal, accounting
and information technology costs and expenses, and make some activities more time consuming and
costly. Compliance with these laws, rules and regulations also require attention from our senior
management and could divert their attention away from the day-to-day management of our business. As
a public company, these laws, rules and regulations also make it more expensive for us to obtain
director and officer liability insurance, and we may be required to accept reduced policy limits and
coverage or incur substantially higher costs to obtain the same or similar coverage. Due to increased
risks and exposure it may be more difficult for us to attract and retain qualified persons to serve on our
board of directors or as officers. As a result of the foregoing, we expect to continue to incur a substantial
increase in legal, accounting, insurance and certain other expenses in the future, which will negatively
impact our financial performance and could cause our results of operations and financial condition to
suffer.
Furthermore, if we are unable to satisfy our obligations as a public company, we could be
subject to the delisting of our Class A ordinary shares, fines, sanctions and other regulatory action and
potentially civil litigation, which could adversely impact our business, results of operation, financial
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Our financial results may be adversely affected if substantial investments in businesses and
operations fail to produce expected returns.
From time to time, we may invest in technology, business infrastructure, new businesses,
product offering and manufacturing innovation and expansion of existing businesses, such as our DTC
operations, which require substantial cash investments and management attention. We believe cost-
effective investments are essential to business growth and profitability; however, significant investments
are subject to typical risks and uncertainties inherent in developing a new business or expanding an
existing business. Additionally, our future potential will require further investments into our supply chain
and operations capabilities, including but not limited to new warehouses or other facilities. For instance,
during 2023 and 2022, we entered into third party logistics and warehouse services agreements for new,
highly-automated fulfillment centers in and Belgium (Beringen) and Atlanta (USA), respectively, in order
to facilitate our future omnichannel growth in both Europe and North America, and lower our handling
cost over time through automation. The failure of any significant investment to provide expected returns
or profitability could adversely impact our financial results and results of operation, and divert our
management’s attention from more profitable business operations.
(ii) Financial reporting and internal controls
If our estimates or judgments relating to our critical accounting policies prove to be incorrect, our
operating results could be adversely affected.
The preparation of financial statements in conformity with IFRS Accounting Standards requires
management to make estimates and assumptions that affect the amounts reported in the consolidated
financial statements and accompanying notes. We base our estimates on historical experience and on
various other assumptions we believe to be reasonable under the circumstances at the time of the
estimate, as provided in “Item 5. Operating and Financial Review and Prospects - E. Critical Accounting
Estimates.” The results of these estimates form the basis for making judgments about the carrying
values of assets, liabilities and equity, and the amount of net sales and expenses that are not readily
apparent from other sources. Significant assumptions and estimates used in preparing our consolidated
financial statements include those related to right-of-use assets, intangible assets, share-based
compensation, employee benefits, provisions and taxes. Our operating results may be adversely
affected if our assumptions change or if actual circumstances differ from those in our assumptions,
which could cause our operating results to fall below the expectations of securities analysts and
investors, resulting in a decline in the price of our Class A ordinary shares.
We are obligated to develop and maintain proper and effective internal control over financial
reporting. If we identify material weaknesses in the future, or otherwise fail to maintain an
effective system of internal control over financial reporting in the future, On may not be able to
accurately or timely report our financial condition or operating results, which may adversely
affect its business, investor confidence, and as result, the price of our Class A ordinary shares.
Our management is responsible for establishing and maintaining adequate internal control over
financial reporting. Effective internal controls over financial reporting are necessary for the Company to
provide reliable financial reports and, together with adequate disclosure controls and procedures, are
designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties
encountered in their implementation could cause the Company to fail to meet its reporting obligations.
We previously identified a material weakness in our internal control over financial reporting.
Although we believe the material weakness has since been remediated, there can be no assurance that
the measures we have taken to date, or any measures we may take in the future, will be sufficient to
identify or prevent future material weaknesses. If other material weaknesses or other deficiencies occur,
our ability to accurately and timely report our financial position could be impaired, which could result in a
material misstatement of our financial statements that would not be prevented or detected on a timely
basis.
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If our internal control over financial reporting is ineffective, or if our independent registered
public accounting firm is unable to express an unqualified opinion on the effectiveness of our internal
control, for example as a result of any identified material weakness, we could lose investor confidence in
the accuracy and completeness of our financial reports.
(iii) Foreign currency exchange rates
Fluctuations in foreign currency exchange rates could harm our net sales, results of operations
and the price of our Class A ordinary shares.
The reporting currency for our consolidated financial statements is the Swiss franc. Because we
recognize net sales in the United States in U.S. dollars, if the U.S. dollar weakens against the Swiss
franc, it would have a negative impact on our net sales and operating results upon translation of those
results into Swiss francs for the purposes of financial statement consolidation. We may face similar risks
in other foreign jurisdictions where sales are recognized in foreign currencies such as the Euro, GBP and
others. In addition, the majority of our cost of purchases of finished goods are sourced in U.S. dollars,
and if the U.S. dollar strengthens against the Swiss franc, it would have a negative impact on our
operating results upon translation of those results into Swiss francs for purposes of financial statement
consolidation. Although we may engage in short-term hedging transactions for a large portion of our
foreign currency-denominated cash flows to mitigate foreign exchange risks, depending upon changes
in future currency rates, such gains or losses could have a significant, and potentially adverse, effect on
our results of operations. Foreign exchange variations (including the value of the Swiss franc relative to
the U.S. dollar) have been significant in the past and current foreign exchange rates may not be
indicative of future exchange rates.
Our earnings per share are reported in Swiss francs, and accordingly may be translated into U.S.
dollars by analysts or our investors. As a result, the value of an investment in our Class A ordinary shares
to a U.S. shareholder will fluctuate as the U.S. dollar rises and falls against the Swiss franc. Our decision
to declare a dividend depends on results of operations reported in Swiss francs. As a result, U.S. and
other shareholders seeking U.S. dollar total returns, including increases in the price of our Class A
ordinary shares and dividends paid, are subject to foreign exchange risk as the U.S. dollar rises and falls
against the Swiss franc.
(iv) Taxes
We could be subject to changes in tax laws, tax regulations and tax treaties, including their
interpretation and application, in Switzerland, the United States or any other country in which we
operate, which could result in additional tax liabilities or increased volatility in our effective tax
rate.
We are subject to the tax laws in Switzerland, the United States and numerous other
jurisdictions. Current economic and political conditions make tax laws, tax regulations and tax treaties,
including their interpretation and application, in any jurisdiction subject to significant change. We earn a
substantial portion of our income in countries around the world and are subject to the tax laws of those
jurisdictions. A number of the jurisdictions in which we operate have recently reformed or changed their
tax laws, regulations and tax treaties, such as the anti-tax avoidance directive adopted by the member
states of the EU, and many jurisdictions are considering other proposals to reform or change their tax
laws, regulations and tax treaties, including minimum tax and tax-avoidance proposals being considered
in connection with the OECD’s project on base erosion and profit shifting, and proposals in the United
States. The adoption or implementation of these proposals could significantly impact how we are taxed
on our earnings from operations in these jurisdictions. Although we cannot predict whether or in what
form these proposals will be adopted, several of the proposals considered, if enacted into law, could
have an adverse impact on our income tax expense and cash flows. Portions of our operations are
subject to a reduced tax rate or are free of tax under various tax holidays and rulings. We also utilize tax
rulings and other agreements to obtain certainty in treatment of certain tax matters. These holidays and
rulings expire in whole or in part from time to time and may be extended when certain conditions are met
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or terminated if certain conditions are not met. The impact of any changes in conditions would be the
loss of certainty in treatment thus potentially impacting our effective income tax rate.
We are subject to standard cantonal taxation and the statutory tax rate in Zurich, Canton of
Zurich, may change from time to time. The standard combined (federal, cantonal, municipal) statutory
corporate income tax rate, except for dividend income for which we could claim a participation
exemption, for 2023 in Zurich, Canton of Zurich, was approximately 19.7%.
The Organization Economic Co-operation and Development (“OECD”) introduced Base Erosion
and Profit Shifting (“BEPS”) Pillar Two rules that impose a global minimum tax rate of 15%. The group is
within the scope of the OECD Pillar Two model rules. The group operates in several jurisdictions where
Pillar Two legislation has been enacted, or substantively enacted. In Switzerland, where the Group is
headquartered, the enacted legislation is currently limited to the introduction of a Qualified Domestic
Top-up Tax effective 1 January 2024.
The OECD has published transitional Country-by-Country Report (CbCR) Safe Harbour rules,
with the purpose to remove the obligation of calculating the Pillar Two effective tax rate for operations in
lower-risk jurisdictions during the initial years when the rules take effect. In applying the transitional
CBCR Safe Harbour rules on the fiscal year end 2023 consolidated financial statements, the majority of
jurisdictions are expected to qualify for the transitional CbCR Safe Harbour rules.
On September 12, 2023, the EU Commission published two draft directives relating to
international tax. The draft Business in Europe: Framework for Income Taxation (BEFIT) directive
provides common rules for determining the corporate tax base for EU-based entities that are part of a
group with global consolidated revenues above EUR 750 million. The BEFIT proposal includes
provisions for a formula-driven allocation of profits between relevant EU member states which would
then be subject to the corporate income tax rate of the respective member state. The draft transfer
pricing directive aims to harmonize transfer pricing rules within the EU consistent with the OECD
Transfer Pricing Guidelines. It also clarifies processes for relieving double taxation within the EU. Both
draft directives require unanimous agreement among EU member states before they can be further
implemented.
In the United States, the Inflation Reduction Act ("IRA") was signed into law on August 16, 2022.
The IRA creates a 15% corporate alternative minimum tax (CAMT) on the profits of corporations whose
average annual adjusted financial statement income exceeds USD 1.0 billion over a three-year period. It
is not expected that the CAMT framework will trigger additional taxes for On Group in 2024. However,
there are special regulations in connection with foreign-parented US entities, which may trigger
administrative burdens.
While we have taken steps to comply with the evolving tax initiatives of the OECD, the United
States and the EU, and we will continue to do so, significant uncertainties remain as to the outcome of
our efforts.
For more information, see “Item 18. Financial Statements-Note 7. Income taxes” and “Item 18. Financial
Statements-Note 6.4 Income Taxes”.
Adverse outcomes resulting from examination of our income or other tax returns could adversely
affect our results of operations and financial condition.
We are subject to the examination of our tax returns by tax authorities in Switzerland, the United
States and numerous other jurisdictions. We regularly assess the likelihood of an adverse outcome
resulting from these examinations to determine the adequacy of its provision for income taxes. Although
we believe our tax provisions are adequate, the final determination of tax audits and any related disputes
could be materially different from our historical income tax provisions and accruals. The results of audits
or related disputes could have an adverse effect on our financial statements for the period or periods for
which the applicable final determinations are made. For example, we and our subsidiaries are engaged
in a number of intercompany transactions across multiple tax jurisdictions. Although we believe that our
transfer pricing policies and positions are correct under current law and we have clearly reflected the
economics of these transactions and the proper local transfer pricing documentation is in place, tax
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authorities may propose and sustain adjustments that could result in changes that may result in material
additional tax liabilities and impact our mix of earnings in countries with differing statutory tax rates.
These factors could have a negative impact on our business, results of operation, financial condition and
the price of our Class A ordinary shares.
If we are a “passive foreign investment company,” or a PFIC, a U.S. shareholder may be subject
to adverse U.S. federal income tax consequences.
Under the Internal Revenue Code of 1986, as amended, or the Code, we will be a PFIC for any
taxable year in which, after the application of certain look-through rules with respect to our subsidiaries,
either (i) 75% or more of our gross income consists of passive income or (ii) 50% or more of the average
quarterly value of our assets consists of assets that produce, or are held for the production of, passive
income (including cash). Passive income includes, among other things, dividends, interest, certain non-
active rents and royalties, and capital gains. Based on the market price of our Class A ordinary shares
during 2023 and the composition of our income and assets, including goodwill, we believe we were not
a PFIC for our 2023 taxable year. However, the determination of whether we are a PFIC is a fact-
intensive determination that must be made on an annual basis applying principles and methodologies
that are in some circumstances unclear, and whether we were a PFIC in 2023 is uncertain in several
respects. Moreover, our PFIC status for any taxable year will depend on the composition of our income
and assets and the value of our assets from time to time (which may be determined, in part, by reference
to the market price of our Class A ordinary shares, which may fluctuate substantially over time).
Accordingly, there can be no assurance that we will not be a PFIC for any future taxable year.
Certain adverse U.S. federal income tax consequences could apply to U.S. investors if we are treated as
a PFIC for any taxable year during which such investors hold our Class A ordinary shares. For further
discussion, see "Taxation - U.S. Tax Considerations."
V. Risks Related to Legal and Regulatory Compliance
(i) Trade policies, tariffs and import/export regulations
Changes to trade policies, tariffs and import/export regulations in the United States, EU and
other jurisdictions, or our failure to comply with such regulations, may have a material adverse
effect on our reputation, business, financial condition and results of operations.
Changes in U.S., EU or international social, political, regulatory and economic conditions could
impact our business, financial condition, results of operations and the price of our Class A ordinary
shares. In particular, political and economic instability, geopolitical conflicts, political unrest, civil strife,
terrorist activity, acts of war, public corruption, expropriation and other economic or political
uncertainties in the United States or internationally could interrupt and negatively affect the sale of our
products or other business operations. Any negative sentiment toward the United States, Switzerland or
toward any country where we operate, sell or have our products manufactured as a result of any such
changes could also adversely affect our business.
In addition, changes in laws and policies governing foreign trade, manufacturing, development
and investment in the territories or countries where we currently sell our products or conduct our
business could adversely affect our business. In the past the United States has instituted or proposed
changes in trade policies that include the negotiation or termination of trade agreements, the imposition
of higher tariffs on imports into the United States, economic sanctions on individuals, corporations or
countries, and other government regulations affecting trade between the United States and other
countries where we conduct our business.
In particular, certain trade restrictions related to forced labor could impact our business. For
instance, the U.S. Government has taken several steps to address forced labor concerns in the Xinjiang
Uyghur Autonomous Region of China, including sanctions on specific entities and individuals; withhold
release orders ("WROs") issued by U.S. Customs and Border Protection ("CBP") that prohibit the entry
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of imports of certain items from Xinjiang; and the Uyghur Forced Labor Prevention Act, which went into
effect in June 2022, and imposes a rebuttable presumption against U.S. imports of any items from
Xinjiang and specifically targets the cotton and apparel industry as high-priority sectors for enforcement.
We do not intentionally source any products or materials from the Xinjiang region (either directly or
indirectly through our supply chain) and we prohibit our suppliers and manufacturers from doing
business with or sourcing from any company or entity located in China's Xinjiang region. However, the
presumptive ban on virtually all imports from that region could affect the global sourcing and availability
of raw materials used in the manufacturing of certain of our products and/or lead to our products being
held for inspection by CBP and delayed or rejected for entry into the United States, which could
unexpectedly affect our inventory levels, result in other supply chain disruptions, or cause us to be
subject to penalties, fines or sanctions. Even if we were not subject to penalties, fines or sanctions, if
products we source are linked in any way to the Xinjiang region, our reputation could be harmed. In
addition, our products could be held for inspection by CBP, which would cause delays and
unexpectedly affect our inventory levels. CBP has also in the past and may in the future challenge or
disagree with our classification of our imports, or our valuation or country of origin determinations. While
we have not experienced tariff liabilities in such instances, such challenges could in the future result in
material tariff liabilities, including tariffs on past imports, as well as penalties and interest.
Changes or proposed changes in the trade policies of the United States, the European
Economic Area or any of its member states or other jurisdictions may result in restrictions and economic
disincentives on international trade. Tariffs and other changes in U.S. and other trade policies have in the
past and could in the future trigger retaliatory actions by affected countries, and certain foreign
governments have instituted or are considering imposing retaliatory measures on certain U.S. goods.
Further, any emerging protectionist or nationalist trends either in the United States, the European
Economic Area or any of its member states or in other countries could negatively affect the trade
environment. We, similar to many other multinational corporations, do a significant amount of business
that would be impacted by changes to the trade policies of the United States and other countries
(including governmental action related to tariffs, international trade agreements, or economic sanctions).
Such changes have the potential to adversely impact the U.S. economy or certain sectors thereof or the
economy of another country in which we conduct operations, our industry and the global demand for
our products, and as a result, could have a negative impact on our business, financial condition, results
of operations and the price of our Class A ordinary shares.
(ii) Data protection laws

Our marketing programs, e-commerce initiatives and use of customer information are governed
by an evolving set of laws and enforcement trends and unfavorable changes in those laws or
trends, or our failure to comply with existing or future laws, could substantially harm our business
and results of operations.
We collect, process, maintain and use data, including sensitive information on individuals,
available to us through online activities and other customer interactions in our business. Our current and
future business operations (particularly our marketing and e-commerce activities) depend on our ability
to collect, maintain and use this information, and our ability to do so is subject to evolving international,
U.S., Swiss, EU, Chinese and other laws and enforcement trends. We strive to comply with all applicable
laws and other legal obligations relating to privacy, data protection and customer protection, including
those relating to the use of data for marketing purposes. It is possible, however, that these requirements
may be interpreted and applied belatedly or in a manner that is inconsistent from one jurisdiction to
another, may conflict with other rules, may conflict with our practices or fail to be observed by our
employees or business partners. If so, we may suffer damage to our reputation and be subject to
proceedings, fines or actions against us by governmental entities or others. Any such proceeding or
action could hurt our reputation and financial situation, diminish our customer’s or employees' trust in
our organization, force us to spend significant amounts to defend our practices and close identified
gaps, distract our management or otherwise have an adverse effect on our business.
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Certain of our marketing practices rely upon e-mail communication with consumers. If there are
changes in the data privacy laws that prohibit this type of marketing, we may lose a very important
communication channel and our ability to effectively reach and engage our customers. We post our
privacy policy and practices concerning the use and disclosure of user data on our websites. Any failure
by us to comply with our posted privacy policy or other privacy-related laws and regulations could result
in proceedings that could potentially harm our business. In addition, as data privacy and marketing laws
change, we may run late on implementation, or incur additional costs to ensure we remain in
compliance. If applicable data privacy and marketing laws become more restrictive at the international,
federal or state levels, our compliance costs may increase, our ability to effectively engage customers
through personalized marketing may decrease, our investment in our e-commerce platform may not be
fully realized, our opportunities for growth may be curtailed by our compliance burden and our potential
reputational harm or liability for security breaches may increase. For more information regarding risks
related to data privacy and security, see “—Risks Related to our Intellectual Property and Information
Technology—Changes in laws or regulations relating to data privacy and security, or any actual or
perceived failure by us to comply with such laws and regulations, or contractual or other obligations
relating to data privacy and security, could lead to government enforcement actions (which could
include civil or criminal penalties), private litigation or adverse publicity and could have a material
adverse effect on our reputation, results of operations, financial condition and cash flows.”
(iii) Legal or regulatory requirements, proceedings and audits
We are subject to comply with many laws and regulations which could expose us to criminal
sanctions, civil penalties, contractual damages, and reputational harm that could substantially
harm our business and results of operations.
Our business requires compliance with many laws and regulations, including, but not limited to,
labor and employment, product safety, fair competition, labelling, sales and other taxes, customs, and
consumer protection laws and ordinances that regulate our industry generally or govern the production,
importation, promotion and sale of merchandise, and the operation of warehouse facilities. For example,
various jurisdictions worldwide have laws and regulations that aim to protect consumers, including by
prohibiting advertising or marketing practices that may be deemed misleading or deceptive. Failure to
comply with any laws or regulations could subject us to lawsuits and other proceedings, and could also
lead to damage awards, fines and penalties. In addition, as a global company we operate in countries
with different legal jurisdictions that pose various risks such as uncertain laws, potential bribery, civil
unrest, economic instability, differing business practices, or consumer behaviors. To the extent we
encounter such challenges, we could be subject to financial losses, criminal and civil penalties and
reputation damage.
We may become involved in a number of legal proceedings and audits, including, but not limited
to, government and agency investigations, and consumer, employment, tort and other litigation. In
addition, we could become subject to potential antitrust claims, which may relate to anti-competitive
behavior, pricing pressures on our distribution and/or retail partners or other allegations. The outcome of
some of these legal proceedings, audits and other contingencies could require us to take actions, or
refrain from taking actions, that could harm our operations or require us to pay substantial amounts of
money, harming our financial condition. Additionally, defending against these lawsuits and proceedings
could result in substantial costs and diversion of management’s attention and resources, harming our
financial condition.
There can be no assurance that any pending or future legal or regulatory proceedings and
audits will not harm our business, financial condition, reputation, results of operations and the price of
VI. Risks Associated with Securities Markets and Ownership of Our Class A Ordinary Shares
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(i) Dual class structure of our shares
The dual class structure of our shares and the existing ownership of Class B voting rights shares
by our extended founder team have the effect of concentrating voting control with our extended
founder team for the foreseeable future, which will limit or preclude your ability to influence
corporate matters.
While each of our shares carries one vote in our general meeting of shareholders, irrespective of
the par value of the shares, our Class A ordinary shares have a par value of CHF 0.10 and Class B voting
rights shares have a par value of CHF 0.01. As a result, on a capital-invested basis, each Class B voting
rights share has ten times the voting power of each Class A ordinary share. Given the increased voting
power of our Class B voting rights shares, members of our extended founder team, who are our only
Class B shareholders and who also hold certain of our Class A ordinary shares, hold approximately
59.2% of total combined voting power of our outstanding shares as at December 31, 2023. In addition,
entitlements to dividends and other distributions are also calculated based on par value. As a result of
our dual class ownership structure, our extended founder team will be able to exert control over our
management and affairs and over matters requiring shareholder approval, including the election of
directors and mergers, and indirectly over acquisitions, asset sales and other significant corporate
transactions. Further, our extended founder team owns shares representing approximately 18.1% of the
economic interest as at December 31, 2023 and together with our other executive officers, directors and
their affiliates, owns shares representing approximately 22.8% of the economic interest and 61.6% of
total combined voting power of our outstanding shares at December 31, 2023. Because of the 10-to-1
voting ratio between the Class B voting rights shares and Class A ordinary shares on a capital-invested
basis, the holders of Class B voting rights shares collectively will continue to control a majority of the
total combined voting power of our outstanding shares and therefore be able to control a substantial
number of matters submitted to our shareholders for approval, so long as the outstanding Class B voting
rights shares represent at least 50% of the total voting power of our shares. In addition, the members of
our extended founder team entered into a shareholders’ agreement giving them a right of first refusal to
purchase shares of Class B voting rights shares that are intended to be sold or transferred by other
members of our extended founder team, subject to certain exceptions. This concentrated control will
limit your ability to influence corporate matters for the foreseeable future. For example, our extended
founder team will be able to control elections of directors, dividend payments and other distributions,
and certain amendments of our articles of association, for the foreseeable future. Additionally, the
holders of our Class B voting right shares may cause us, through the election of the directors, to make
strategic decisions or pursue acquisitions that could involve risks to you, are contrary to your
expectations or may not be aligned with your interests. This control may materially adversely affect the
market price of our Class A ordinary shares.
Our dual class structure may depress the trading price of our Class A ordinary shares.
Our dual class structure may result in a lower or more volatile market price of our Class A
ordinary shares or in adverse publicity or other adverse consequences. For example, certain index
providers have announced restrictions on including companies with dual or multiple class share
structures in certain of their indexes. S&P Dow Jones, MSCI and FTSE Russell have announced changes
to their eligibility criteria for inclusion of shares of public companies on certain indices, including the S&P
500. These changes exclude companies with multiple classes of shares from being added to these
indices. In addition, several stockholder advisory firms have announced their opposition to the use of
dual or multiple class structures. As a result, the dual class structure of our shares may prevent the
inclusion of our Class A ordinary shares in these indices and mutual funds, exchange-traded funds and
other investment vehicles that attempt to passively track these indices will not invest in our stock. Any
such exclusion from indices could result in a less active trading market for our Class A ordinary shares
and depress the valuations of publicly traded companies excluded from the indices compared to those
of similar companies that are included. Our dual-class structure may cause stockholder advisory firms to
publish negative commentary about our corporate governance practices or otherwise seek to cause us
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to change our capital structure. Any actions or publications by stockholder advisory firms critical of our
corporate governance practices or capital structure could also adversely affect the value of our Class A
ordinary shares.
(ii) Foreign private issuer status
We may lose our foreign private issuer status, which would then require us to comply with the
Exchange Act’s domestic reporting regime and cause us to incur significant legal, accounting and
other expenses.
We qualify as a foreign private issuer under the Exchange Act and therefore we are not required
to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act
applicable to U.S. domestic issuers. In order to maintain our current status as a foreign private issuer a
majority of our outstanding voting securities must be directly or indirectly held of record by nonresidents
of the United States and all of the following criteria must be met (i) a majority of our executive officers or
directors may not be United States citizens or residents, (ii) more than 50% of our assets cannot be
located in the United States and (iii) our business must be administered principally outside the United
States. If we lose our status as a foreign private issuer, we would be required to comply with the
Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more
detailed and extensive than the requirements for foreign private issuers, and would require us to present
our financial statements in accordance with U.S. GAAP, which would be time consuming and costly. We
may also be required to make changes in our corporate governance practices in accordance with
various Securities and Exchange Commission ("SEC") and stock exchange rules. The regulatory and
compliance costs to us under U.S. securities laws if we are required to comply with the reporting
requirements applicable to a U.S. domestic issuer may be significantly higher than the cost we would
incur as a foreign private issuer. As a result, we expect that a loss of foreign private issuer status would
increase our legal and financial compliance costs and would make some activities highly time
consuming and costly. We also expect that if we are required to comply with the rules and regulations
applicable to U.S. domestic issuers, it would be more difficult and expensive for us to obtain director
and officer liability insurance, and we may be required to accept reduced coverage or incur substantially
higher costs to obtain coverage. These rules and regulations could also make it more difficult for us to
attract and retain qualified members of our board of directors.
As a foreign private issuer and “controlled company” within the meaning of the NYSE corporate
governance rules, we are permitted to, and we do, rely on exemptions from certain of the NYSE
corporate governance standards, including the requirement that a majority of our board of
directors consist of independent directors. Our reliance on such exemptions may afford less
protection to holders of our Class A ordinary shares.
The corporate governance rules of the NYSE require listed companies to have, among other
things, a majority of independent directors and independent director oversight of executive
compensation, nomination of directors and corporate governance matters. As a foreign private issuer,
we are permitted to, and we do, follow home country practice in lieu of the above requirements. As long
as we rely on the foreign private issuer exemption to certain of the NYSE corporate governance
standards, a majority of the directors on our board of directors are not required to be independent
directors, our compensation committee is not required to be composed entirely of independent directors
and director nominations are not required to be made, or recommended to our full board of directors, by
a nominations committee that consists entirely of independent directors. Therefore, our board of
directors’ approach to governance may be different from that of a board of directors consisting of a
majority of independent directors, and, as a result, the management oversight of our Company may be
more limited than if we were subject to all of the NYSE corporate governance standards. We are also
subject to certain reduced disclosure obligations as a result of being a foreign private issuer. As such,
investors will not have access to the same information as for similar companies that are not foreign
private issuers.
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In the event we no longer qualify as a foreign private issuer, we intend to rely on the “controlled
company” exemption under the NYSE corporate governance rules. A “controlled company” under the
NYSE corporate governance rules is a company of which more than 50% of the voting power is held by
an individual, group or another company. Our extended founder team controls a majority of the
combined voting power of our outstanding shares, making us a “controlled company” within the
meaning of the NYSE corporate governance rules. As a controlled company, we would be eligible to,
and, in the event we no longer qualify as a foreign private issuer, we intend to, elect not to comply with
certain requirements of the NYSE corporate governance standards, including (i) the requirement that a
majority of the board of directors consist of independent directors, (ii) the requirement that we have a
compensation committee that is composed entirely of independent directors and (iii) the requirement
that our director nominations be made, or recommended to our full board of directors, by a nominations
committee that consists entirely of independent directors.
Accordingly, our shareholders will not have the same protection afforded to shareholders of companies
that are subject to all of the NYSE corporate governance standards, and the ability of our independent
directors to influence our business policies and affairs may be reduced.
(iii) Pricing volatility, dividends, and dilution
Future sales, or the perception of future sales of our Class A ordinary shares in the public market
could cause the market price of our Class A ordinary shares to decline.
Sales of a substantial number of our Class A ordinary shares in the public market, or the
perception that these sales might occur, could depress the market price of our Class A ordinary shares
and could impair our ability to raise capital through the sale of additional equity securities. Certain of our
equity holders existing prior to our IPO in 2021 have substantial unrecognized gains on the value of the
equity they hold, and therefore they may take steps to sell their shares or otherwise secure the
unrecognized gains on those shares. We are unable to predict the timing of or the effect that such sales
may have on the prevailing market price of our Class A ordinary shares. All of the Class A ordinary
shares are freely tradable without restrictions or further registration under the Securities Act of 1933, as
amended, or the Securities Act, except for any shares held by our affiliates as defined in Rule 144 under
the Securities Act, or Rule 144.
We do not intend to pay dividends for the foreseeable future and, as a result, your ability to
achieve a return on your investment will depend on appreciation in the price of our Class A
ordinary shares.
We have never declared or paid any cash dividends on our share capital, and we do not intend
to pay any cash dividends in the foreseeable future.
Any future proposals to our shareholders’ meeting to pay dividends in the future will be decided
at the discretion of our board of directors, after taking into account various factors, including our
business prospects, cash requirements, financial performance and new product development, and
subject to approval at a general meeting of shareholders. In addition, payment of future dividends is
subject to certain limitations pursuant to Swiss law. See “Item 10. Additional Information - Memorandum
and Articles of Association - Dividend Rights.” Accordingly, you may need to rely on sales of our Class A
ordinary shares after price appreciation, which may never occur, as the only way to realize any future
gains on your investment.
If securities analysts do not continue to publish research or reports about our business or if they
publish negative evaluations of our Class A ordinary shares, the price of our Class A ordinary
shares could decline.
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The trading market for our Class A ordinary shares relies in part on the research and reports that
industry or securities analysts publish about us or our business. If one or more of the analysts covering
our business downgrade their evaluations of our Class A ordinary shares or publish inaccurate or
unfavorable research about our business, the price of our Class A ordinary shares could decline. In
addition, if our operating results fail to meet analyst forecasts, the price of our Class A ordinary shares
would likely decline. If one or more of these analysts cease to cover our Class A ordinary shares, we
could lose visibility in the market for our stock, which in turn could cause the price of our Class A
ordinary shares to decline.
(iv) Swiss corporate law
We are a Swiss corporation. The rights of our shareholders may be different from the rights of
shareholders in companies governed by the laws of U.S. jurisdictions.
We are a Swiss corporation. Our corporate affairs are governed by our articles of association
and by the laws governing companies, including listed companies, incorporated in Switzerland. The
rights of our shareholders and the responsibilities of members of our board of directors may be different
from the rights and obligations of shareholders and directors of companies governed by the laws of the
United States. In the performance of its duties, our board of directors is required by Swiss law to
consider the interests of our Company, and may also have regard to the interests of our shareholders,
our employees and other stakeholders, in all cases with due observance of the principles of
reasonableness and fairness. It is possible that some of these parties will have interests that are different
from, or in addition to, your interests as a shareholder. Swiss corporate law limits the ability of our
shareholders to challenge in court resolutions made or other actions taken by our board of directors.
Under Swiss law, our shareholders generally are not permitted to file a suit to reverse a decision
or an action taken by our board of directors, but are instead only permitted to seek damages for
breaches of fiduciary duty. As a matter of Swiss law, shareholder claims against a member of our board
of directors for breach of fiduciary duty would have to be brought in the competent courts in Zurich,
Switzerland, or where the relevant member of our board of directors is domiciled. In addition, under
Swiss law, any claims by our shareholders against us must be brought exclusively in the competent
courts in Zurich, Switzerland. U.S.-style class actions and derivative actions are not available under
Swiss law. A further summary of applicable Swiss corporate law is included in this Annual Report, see
“Item 10. Additional Information - Memorandum and Articles of Association.” There can be no assurance
that Swiss law will not change in the future, the occurrence of which could adversely affect the rights of
our shareholders, or that Swiss law will protect our shareholders in a similar fashion as under U.S.
corporate law principles.
Our shares are not listed in Switzerland, our home jurisdiction. As a result, our shareholders will
not benefit from certain provisions of Swiss law that are designed to protect shareholders in a
public takeover offer or a change-of-control transaction.
Because our Class A ordinary shares are listed exclusively on the NYSE and not in Switzerland,
our shareholders will not benefit from the protection afforded by certain provisions of Swiss law that are
designed to protect shareholders in the event of a public takeover offer or a change-of-control
transaction. For example, Article 120 of the Swiss Financial Market Infrastructure Act and its
implementing provisions require investors to disclose their interest in our Company if they reach, exceed
or fall below certain ownership thresholds. Similarly, the Swiss takeover regime imposes a duty on any
person or group of persons who acquires more than one-third of a company’s voting rights to make a
mandatory offer for all of the Company’s outstanding listed equity securities. In addition, the Swiss
takeover regime imposes certain restrictions and obligations on bidders in a voluntary public takeover
offer that are designed to protect shareholders. However, these protections are applicable only to
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issuers that list their equity securities in Switzerland, and because our Class A ordinary shares are listed
exclusively on the NYSE, they will not be applicable to us. Furthermore, since Swiss law restricts our
ability to implement rights plans or U.S.-style “poison pills,” our ability to resist an unsolicited takeover
attempt or to protect minority shareholders in the event of a change-of-control transaction may be
limited. Therefore, our shareholders may not be protected to the same degree in a public takeover offer
or a change-of-control transaction as are shareholders in a Swiss company listed in Switzerland.
Our status as a Swiss corporation means that our shareholders have certain rights that may limit
our flexibility to raise capital, issue dividends and otherwise manage ongoing capital needs.
Swiss law reserves for approval by shareholders certain corporate actions over which a board of
directors would have authority in certain other jurisdictions. For example, the payment of dividends and
cancellation of treasury shares must be approved by shareholders. Swiss law also requires that our
shareholders themselves resolve to, or authorize our board of directors to, increase our share capital. As
of January 1, 2023, the concept of the “authorized capital” was replaced by a new concept called the
“capital band” ("Kapitalband"). The new law allows for an increase and/or decrease of up to 50% of the
share capital. For more information, please see “Item 10.B. Memorandum and Articles of Association—
Ordinary Capital Increase, Authorized and Conditional Share Capital.”
Shareholders outside of the United States may not be able to exercise preemptive rights in future
issuances of equity or other securities that are convertible into equity.
Under Swiss corporate law, shareholders may receive certain preemptive rights to subscribe on
a pro-rata basis for issuances of equity securities or other securities that are convertible into equity
securities. Due to the laws and regulations in certain jurisdictions, however, shareholders who are not
residents of the United States may not be able to exercise such rights unless the Company takes action
to register or otherwise qualify the rights offering, including, for example, by complying with prospectus
requirements under the laws of that jurisdiction. There can be no assurance that the Company will take
any action to register or otherwise qualify an offering of subscription rights or shares under the laws of
any jurisdiction other than the United States where the offering of such rights is restricted. If
shareholders in such jurisdictions were unable to exercise their subscription rights, their ownership in the
Company would be diluted.
U.S. shareholders may not be able to obtain judgments or enforce civil liabilities against us or our
executive officers or our board of directors.
We are a corporation organized and incorporated under the laws of Switzerland with registered
office and domicile in Zurich, Switzerland, and the majority of our assets are located within Switzerland.
Moreover, a number of our directors and executive officers are not residents of the United States, and all
or a substantial portion of the assets of such persons are or may be located outside the United States.
As a result, investors may not be able to enforce judgments obtained against the Company or such
persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the
federal securities laws of the United States. There is doubt that a lawsuit based upon United States
federal or state securities laws could be brought in an original action in Switzerland and that a judgment
of a U.S. court based upon United States securities laws would be enforced in Switzerland.
The United States and Switzerland currently do not have a treaty providing for the reciprocal
recognition and enforcement of judgments, other than arbitration awards, in civil and commercial
matters. Consequently, a final judgment for payment given by a court in the United States, whether or
not predicated solely upon U.S. securities laws, may not be enforceable in Switzerland.
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ITEM 4. INFORMATION ON THE COMPANY

A. History and Development of the Company
On AG, a subsidiary of On Holding AG, was founded in Switzerland in 2010, and in 2012 On
Holding AG, a limited company, was incorporated in accordance with Swiss law and became the
ultimate holding company for the consolidated group. The Company's principal offices are located at
Förrlibuckstrasse 190, 8005 Zurich, Switzerland (telephone +41 44 225 1555). Our agent for service of
process in the United States is Cogency Global Inc. located at 122 East 42nd Street, 18th floor, New
York, NY 10168. Our website address is www.on.com. The information contained on, or that can be
accessed through, our website is not incorporated by reference into, and is not a part of, this Annual
Report on Form 20-F. Investors should not rely on any such information in deciding whether to purchase
In 2021, On Holding AG became a publicly traded company on the New York Stock Exchange
("NYSE"). Our reports filed with or furnished to the SEC are available, free of charge, on our investor
relations website at https://investors.on.com/financials-and-filings/ as soon as reasonably practicable
after we electronically file such material with, or furnish it to, the SEC. The SEC maintains a website at
http://www.sec.gov that contains reports and other information regarding us and other companies that
file materials with the SEC electronically. We use our investor relations website as a means of disclosing
material information. Accordingly, investors should monitor our investor relations website, in addition to
following our press releases, SEC filings, and public conference calls and webcasts.
As described elsewhere in this Annual Report, our principal capital expenditures since January
1, 2021 relate to the opening of offices, warehouses and retail stores in both Switzerland and globally as
well as investments into our IT infrastructure, which has been funded from cash on hand as well as the
proceeds from our IPO in 2021. In 2022, we entered into a twelve-year (two-year ramp-up and 10-year
duration) third party logistics and warehouse services agreement for a new, highly-automated fulfillment
center in Atlanta (USA), that will partially commence in 2024, to facilitate our future omnichannel growth
in North America and lower our handling costs over time through automation. In the second quarter of
2023, we entered into a ten-year third party logistics and warehouse services agreement for a highly
automated and new fulfillment center in Beringen (Belgium), to facilitate our future omnichannel growth
in Europe and lower our handling cost over time through automation.
B. Business Overview
On was born in the Swiss Alps with one goal: to revolutionize the sensation of running by
empowering all to run on clouds. Since its market launch in 2010, On delivers industry-disrupting
innovation in premium footwear, apparel, and accessories for high-performance running, outdoor,
training, all-day activities and tennis. Fueled by customer-recommendation, On’s award-winning
CloudTec innovation, purposeful design and ground-breaking strides in sportswear’s circular economy
have attracted a fast-growing global fan-base — inspiring humans to explore, discover and dream on.
On is present in more than 60 countries globally and engages with a digital community on www.on.com.
We believe we are one of the fastest-growing scaled athletic sports companies in the world. For
fiscal years 2023, 2022, and 2021 we generated net sales of CHF 1,792.1 million, CHF 1,222.1 million,
and CHF 724.6 million, respectively, representing 46.6% and 68.7% year-over-year growth. As a Swiss
company with a small home market, we opted to expand globally from the very beginning, and today we
have a fast-growing presence across a number of international markets including, among others,
Germany (first entered in 2011), the United States (2013), Japan (2013), China (2018) and Brazil (2018).
We believe this global presence within the large global footwear and apparel market positions us well for
future growth.
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Net Sales by Region
EMEA
27.2%
Americas
64.9%
Asia-Pacific
7.9%
Americas Asia-Pacific EMEA

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The following table presents net sales by region (based on the location of the customers):
Fiscal year ended December 31,
(CHF in millions) 2023 2022 2021
Europe, Middle East and Africa 488.7 378.1 264.3

Americas 1,162.2 763.8 417.6
Asia-Pacific 141.1 80.2 42.7
Net Sales 1,792.1 1,222.1 724.6
The following table presents net sales by sales channels:

Wholesale 1,120.3 777.0 448.8

Direct-to-Consumer 671.8 445.1 275.8
Net sales 1,792.1 1,222.1 724.6
The following table presents net sales by product groups:

Shoes 1,711.4 1,167.5 683.3

Apparel 68.9 47.3 36.3
Accessories 11.8 7.4 5.0
Net sales 1,792.1 1,222.1 724.6
Our Growth Strategies

We intend to deliver continued growth in net sales and profitability by executing on the following
growth strategies:
Grow Brand Awareness and our Community

We believe that powerful consumer trends will continue to expand the global sportswear
industry and that our differentiated product offering and appeal to our loyal community will drive
increasing market share. We believe our brand is globally recognized today, and we have significant
opportunities to further grow our brand awareness and expand the size and breadth of our community.
While we have meaningfully grown internationally over the past decade, our unaided brand awareness
outside of Switzerland remains below established sportswear peers, providing us with a clear runway
ahead.
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Authenticity gained through word of mouth, recommendations from athletes, influencers,

tastemakers and a global community of runners and explorers has proven extremely valuable in
organically and credibly growing the On brand. To further drive our brand’s awareness now and in the
future, our marketing team will focus on the following strategies:
• Digital and social media: With a fast growing social presence fueled by storytelling, athletes and
both physical and digital live events, we have the ability to create culturally relevant moments
that generate brand excitement in front of a large audience. Our high share of voice shows that
our engaged global community members are active within our channels and also promote On to
their own audiences, sharing tips and offering advice to enhance the community experience.
• Athlete advocacy: There is no better validation for our products than professional athletes
trusting our shoes in the most demanding settings. Olympians and World Champions in track
and field, triathlon and tennis embrace our products and proudly display them on the world
stage. At the same time, our athletes create opportunities for core sporting storytelling that
create public relations opportunities for cultural impact.
• Grassroots: The ‘Try On’ experience has proven a useful tool for us to show the benefit of our
products and truth in our performance claims. With the community runs hosted at our retail
stores and globally owned event series such as the 'On Track Nights', we are creating scalable
formats as we expand to more key cities, inviting thousands of running enthusiasts to test and
discover our brand. By further developing and adding new formats, as well as utilizing the
breadth of our retail partners, we plan to reach and grow our community even further.
Our internal agency team collaborates across the business to ensure we are integrated directly
into decision making for premium product storytelling, new innovative services, authentic community
growth and shareable moments. At its heart, our marketing philosophy is simply to work with those who
love our product, which we believe supports our high marketing efficiency and authenticity.
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Leverage Innovation Leadership to Broaden Product Portfolio

We founded On with a view of making movement more effortless and comfortable. Since our
founding in 2010, we have expanded our focus beyond runners and their shoes. Our innovation teams
include Swiss engineered technology in our products that can be worn while running, training, exploring
or simply during all-day activities. We believe we can leverage our expertise in running to improve the
functionality of products in adjacent lifestyles, including fitness, everyday use, outdoors and tennis, and
to further broaden our product portfolio from footwear to apparel and accessories. While we expect to
always be deeply rooted in running, consumers around the world have shown an interest in our other
products, significantly increasing On’s total addressable market.
Expand our Geographic Footprint Through Controlled, Multi-channel Growth

We have experienced historical growth in almost all of our international markets and we believe
we have opportunities for continued market share gains. While we have generated net losses in the past,
we have consistently achieved significant net sales growth historically as we have entered new markets.
We believe that pioneering a true multi-channel strategy will ultimately lead to superior
outcomes, lower cost of customer acquisition and higher customer retention and repeat purchases. Our
wholesale and our DTC channels are mutually beneficial to each other because we strive to always put
the customer first. We ask ourselves which customers we want to attract and what is the best and most
efficient acquisition channel to deliver a superior experience to these customers. We then aim to deliver
that superior experience wherever the customer decides to shop, whether online or in a physical store.
We intend to continue to grow our global footprint by tapping into new customer segments
without compromising our premium customer experience across our wholesale and DTC channels:
• Wholesale channel expansion: We intend to take a measured approach to attract new customers
and enter new markets through selected retail partners that are complementary to our brand. We
started with the run specialty channel and then selectively expanded to additional premium retail
partners to reach a broader audience, building on the initial momentum and brand halo gained
by our presence in specialty stores.
• Additional doors: We believe there is significant room to enter additional premium doors
in less mature markets. While we see potential in tapping into new customer segments
in many of our established markets, we expect the expansion to primarily come from
existing wholesale partners.
• Higher sales per door: We believe that by delivering a superior On brand experience at
our wholesale partners (in an online and offline environment), we still have room to
increase our sales per door. Furthermore, we aim to work with our partners in a very
integrated way, including planning assortments and inventory and ensuring that we have
the right product assortment in the corresponding channel for the respective consumer.
• DTC channel expansion: The second pillar to the multi-channel growth is our DTC channel, both
digital and physical, which we believe enables greater consumer engagement and offers an
optimal environment to showcase our brand. We believe that this customer experience will lead
to a continued increased share of our DTC channel in the long term.
• Digital: We believe that we have ample opportunity to not only acquire new customers,
but also drive repeat purchases. Knowing our customers and being able to provide them
a superior experience over time is key. Historically, we have achieved growth in our
digital channel thanks to our capability to achieve superior returns on our advertising
spend. We will continue to strive for strong growth to further enhance our digital
experience.
• Physical: Following our successful, selective expansion of physical stores in the past
years, we plan to accelerate the build-out of our own retail stores to showcase our
brand and products. We believe that these will further strengthen our local community
and brand reach. Our stores will be designed to create an enriching customer
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experience through technology and personalized customer service. We opened our first
flagship retail location in New York City in 2020, and we have since then continued to
expand with retail locations in key cities around the globe, adding for example London,
Paris and Miami in 2023. We believe retail stores will be a key growth pillar in China and
we currently operate 22 owned retail stores located in Shanghai, Chengdu, Shenzhen
and Beijing, among others. We target premium shopping locations in major cities where
we are able to directly connect with customers who we believe will connect with On.
Continue to Drive Operational Excellence

As we scale our business, we plan to continue leveraging our brand and powerful business
model to drive operational efficiencies and improved financial and operating performance by:
• Strong channel profitability and mix. We intend to expand our DTC channel in high-value
markets that can support the profitable rollout of e-commerce and select retail stores. We
believe this will allow us to maintain our high levels of gross profit margin in our e-commerce-led
DTC channel.
• Operating leverage. We have invested ahead of our growth in all areas of the business and have
built highly scalable business processes, including design and manufacturing, multi-channel
distribution and corporate infrastructure. As we continue our growth trajectory, On expects to
realize economies of scale. At the same time, On will continue to invest into all areas of the
business as part of our geographical and product expansion.
Looking toward the future, we believe that these initiatives will provide a robust foundation for
growth and position us to continue capturing market share.
Our products
All our products are engineered in Switzerland, and our in-house research and development
teams work on the innovation, engineering, design, development and testing of our products. Our shoe,
apparel and accessories products are designed primarily for specific athletic use, although a significant
amount of our products are also adopted for casual or leisure purposes. We place considerable
emphasis on technological innovation for performance, including our proprietary CloudTec, CloudTec
Phase, Helion superfoam and Speedboard technologies, and high-quality construction in the
development and design of our footwear and apparel. Our focus is on sourcing renewable raw materials.
Our products use sustainable materials such as recycled polyesters and polyamide, organic cotton,
vegan leather and PFAS-free membranes. Our sustainability focus is showcased through our
subscription model Cyclon, with the Cloudneo shoe, which is over 90% recyclable, and the addition of
the Cyclon-T in 2023. The Cloudneo shoes are only available through an innovative monthly subscription
model whereby the product is returned to the Company at the end of the subscription for recycling.
In recent years, our brand has transitioned from offering primarily footwear to becoming a full
sportswear brand. We aim to significantly scale our apparel business over the next years, with each of
our verticals to offer complete head-to-toe looks. The recently introduced Training vertical is the first to
center predominantly around apparel, highlighting our commitment to a holistic sportswear portfolio. Our
general verticals include:
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Our footwear, apparel and accessories belong to the above-mentioned verticals and are sold
through a diverse range of marketing and distribution channels such as sports specialty, general
sporting goods, department stores and our own DTC channels. Our products are primarily designed for
athletic use which demonstrates our commitment to performance innovation and high-quality
construction.
Sourcing and manufacturing

We do not own or operate any manufacturing facilities, and all of our products are supplied by
third parties. We work with a selected group of approximately 25 suppliers, five of which produced
approximately 67% of our products in 2023. All of our footwear was produced by 11 different suppliers,
of which 10 are in Vietnam and one in Indonesia. Our apparel and accessories were sourced from 14
different suppliers across various countries including China, Vietnam, Germany, Portugal, Slovenia, and
Turkey.
In order to mitigate supplier concentration risks, we continuously seek out alternative suppliers
and manufacturers when possible and develop contingency plans for responding to disruptions. For key
shoe models, we use at least two suppliers to minimize supply risk and to promote competition among
suppliers on the basis of cost and quality.
We purchase from our primary suppliers on a purchase order basis informed by capacity
forecasts we prepare, and have non-exclusive purchase commitments based on our purchase orders for
certain amounts of goods, work-in-progress and components. We measure supplier performance
through various performance indicators, including on-time delivery, quality, sustainability and other
criteria, on a monthly basis. Suppliers are categorized according to their skills and capabilities, and we
allocate products and volume based on their business performance and capabilities. Under our supplier
agreements, our suppliers must follow our established product design specifications and quality
assurance programs to meet our demanding production standards. Production and quality control staff
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in each country from which we source products monitor manufacturing at supplier facilities in order to
correct any issues prior to shipment of the final product. We require all suppliers who manufacture our
products to comply with our Supplier Code of Conduct relating to working conditions as well as certain
environmental, employment and sourcing practices. We have worked to develop preferred relationships
with our partners, where possible, to maintain access to the resources needed to scale seasonally and
ensure our partners have the requisite experience to produce our footwear, apparel and accessories.
Multi-Channel Distribution Network

We sell our products through our wholesale and DTC channels. In 2023 and 2022 our wholesale
channel accounted for 62.5% and 63.6% of our net sales respectively, and our DTC channel contributed
37.5% and 36.4% of our net sales respectively. Retail partners are carefully selected across the
wholesale channels (including select third-party online-only platforms), based on their compatibility with
our premium brand, positioning in the market and industry expertise. Within DTC, we limit distribution
exclusively to our own e-commerce website as well as our owned and operated retail stores. Within
China, we also consider our distribution through Tmall and JD.com as DTC.
Direct-to-Consumer. We operate an e-commerce-led DTC channel, which has grown rapidly
since its launch in 2012. Our online store features our full product offering and grants us the ability to
build valuable intelligence through a direct conversation with our customers. We rolled out our e-
commerce platform in Europe and the United States in 2012 and 2013 respectively, in conjunction with
developing our own teams on the ground to manage our wholesale channel. Due to the flexible nature of
e-commerce, we are now able to sell products via our e-commerce platform across multiple countries
globally. While our e-commerce platform is rapidly gaining penetration globally, the European and the
U.S. online stores are our largest markets and together, contributed 81% of our total DTC net sales in
2023. E-commerce also allows us to introduce specific innovations. For example, Cloudneo, our first
shoe designed to be recycled is only available through a monthly subscription model called Cyclon.
Customers never own the Cloudneo shoes, but rather use them until they need a new pair, at which
point they can return used footwear to us and receive a new pair. The entire program management of
this product is administered through our online platform.
Our e-commerce rollout is complemented by our own retail stores in premium high-traffic
locations. We opened our first retail flagship store in New York City in 2020. We also operate retail stores
in London, Tokyo, Zurich, and Los Angeles, amongst other cities. We opened our first smaller format,
mall-based store in China in 2019 and have since then opened over 20, smaller format stores in China.
Going forward, we plan to open additional retail stores in other major metropolitan centers as well as
athletic destinations where we believe they can operate profitably and create further brand momentum.
This unfiltered window into our brand will allow us to develop a closer relationship with our customers
through exclusive experiences, feature our full product offering, retain pricing control and drive net sales
growth across both channels.
Wholesale. Building on the expertise of third parties, the wholesale channel allows us to enter
and develop new and existing markets, build and maintain leading positions within our geographies and
support digital marketing investments to strengthen the DTC channel. We utilize a controlled wholesale
channel expansion approach, which entails entering a particular market through selected specialty
running retailers and then expanding to other partners with more generalist capabilities that reach a
wider community while still maintaining our brand message, ethos and premium quality. As part of this
approach, we develop strategic and long-term relationships directly with retailers and distributors and
work with a select set of partners who respect our heritage, share our values and strengthen our market
presence. Our wholesale distribution includes a mix of specialty, sporting goods, outdoor, luxury and
street fashion retailers, with varying shares between their online and offline sales. We leverage our
mutually beneficial relationships to receive prime placement within their stores, showcase a relevant
product offering and establish On shops-in-shops to deliver the best possible customer experience.
Careful planning with our wholesale network helps us manage inventory effectively and achieve high
levels of full-price sell-through.
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Competition
Competition in the shoe, apparel and accessories industry is principally on the basis of brand
image and recognition, product quality, innovation, design, sustainability, distribution and price. We
believe that we successfully compete on the basis of our premium brand image, our focus on running
and our technical product innovation. We are also differentiated by our commitment to community-
based grassroots marketing which allows us to increase brand awareness and strengthen customer
loyalty.
The market for performance shoes, apparel and accessories is highly competitive and
fragmented. It includes increasing competition from established companies who are expanding their
production and marketing of performance products, as well as from frequent new entrants to the market.
We are in direct competition with wholesalers and direct sellers of athletic footwear and apparel, such as
Nike, Inc., Adidas AG, Under Armour, Inc., Brooks Sports Inc., Hoka One One (Deckers Outdoor
Corporation), Asics, New Balance, Lululemon, Patagonia, Arcteryx, Anta Group and Li Ning. We believe
that having been able to break into the competitive set of top 5 running brands in the biggest running
markets the United States, Germany and Japan provides a platform for future growth and positions us
well against certain of our competitors.
Intellectual Property
Our long-term commercial success is connected to our ability to obtain and maintain intellectual
property protection for our brand, products and technology, defend and enforce our intellectual property
rights, preserve the confidentiality of our trade secrets, operate our business without infringing,
misappropriating or otherwise violating the intellectual property or proprietary rights of third parties and
prevent third parties from infringing, misappropriating or otherwise violating our intellectual property
rights. We seek to protect our investments made into the development of our products, technology,
brand and design by relying on a combination of trademarks, patents, designs, copyrights, trade
secrets, know-how, non-disclosure agreements, confidentiality agreements, invention assignment
agreements, development agreements and other contractual rights.
We use registered trademarks on nearly all of our products and believe having distinctive marks
that are readily identifiable is an important factor in creating a market for our goods, in identifying our
brands, and in distinguishing our goods from the goods of others. As of December 31, 2023, we own
approximately 1,176 trademark registrations in approximately 58 different jurisdictions. We consider our
trademarks such as On, the On logo, On Running, Cyclon, Cloudtec, Cloud and the Cloud family of
marks, and the Cloud logo to be among our most valuable assets. The current registrations of these
trademarks are effective for varying periods of time and may be renewed periodically, provided that we,
as the registered owner, comply with all applicable renewal requirements including, where necessary,
the continued use of the trademarks in connection with similar goods and services.
We file for, own and maintain numerous U.S. and foreign utility and design patents relating to
components, technologies, materials, features, functionality, and industrial and aesthetic designs used in
and for the manufacture of various of our products. Assuming payment of all appropriate maintenance,
renewal, annuity or other governmental fees, these issued patents and utility models, and any patents
granted from such applications, if issued, are expected to expire between 2024 and 2044, without taking
potential patent term extensions or adjustments into account. We continually review our development
efforts to assess the existence and patentability of new intellectual property. The term of individual
patents depends upon the legal term for patents in the countries in which they are granted. In most
countries, including the United States, the patent term is 20 years from the earliest claimed filing date of
a non-provisional patent application in the applicable country. In the United States, a patent’s term may,
in certain cases, be lengthened by patent term adjustment, which compensates a patentee for
administrative delays by the United States Patent and Trademark Office in examining and granting a
patent. It may also be shortened if a patent is terminally disclaimed over a commonly owned patent or a
patent naming a common inventor and having an earlier expiration date. We cannot be sure that our
pending patent applications that we have filed or may file in the future will result in issued patents in any
jurisdiction, and we can give no assurance that any patents that have been issued or might be issued in
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the future will protect our current or future products, will provide us with any competitive advantage, and
will not be challenged, invalidated, or circumvented.
Moreover, we rely, in part, on trade secrets to protect aspects of our business that are not
amenable to, or that we do not consider appropriate for, patent protection. However, trade secrets can
be difficult to protect. While we take steps to protect and preserve our trade secrets and our know-how,
unpatented technology and other proprietary information, including by entering into intellectual property
assignment agreements, non-compete agreements and confidentiality agreements and by maintaining
physical security of our premises and physical and electronic security of our information technology
systems, such measures can be breached, and we may not have adequate remedies for any such
breach. In addition, our trade secrets may otherwise become known or be independently discovered by
competitors. As a result, we may not be able to meaningfully protect our trade secrets. For more
information regarding the risks related to our intellectual property, please see “Risk Factors—Risks
Related to Our Intellectual Property and Information Technology.”
Government Regulations
Our business activities are global and are subject to various federal, cantonal, local, and foreign
laws, rules and regulations. For example, substantially all of our import operations are subject to
complex trade and customs laws, regulations and tax requirements such as sanctions orders or tariffs
set by governments through mutual agreements or unilateral actions. In addition, the countries in which
our products are manufactured or imported may from time to time impose additional duties, tariffs or
other restrictions on our imports or adversely modify existing restrictions. Changes in tax policy or trade
regulations, or the imposition of new tariffs on imported products, could have an adverse effect on our
business and results of operations. Compliance with these laws, rules and regulations has not had, and
is not expected to have, a material effect on our capital expenditures, results of operations and
competitive position as compared to prior periods, and we do not currently anticipate material capital
expenditures for environmental control facilities. For more information on the potential impacts of
government regulations affecting our business, see "Item 3D—Risk Factors".
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C. Organizational Structure
The following chart reflects our simplified organizational structure presenting main legal entities
which are, directly or indirectly, 100% owned by On Holding AG (including the jurisdiction of formation
or incorporation of the various entities).
D. Property, Plants and Equipment

Our tangible fixed assets are mainly comprised of trade and production tools, leasehold
improvements in own retail locations and global corporate offices. We generally enter into long-term
leases for our main facilities such as offices, warehouses and retail locations which we believe are in
good condition and working order. The below table lists material tangible fixed assets, including leased
properties.
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Location Principal activity Total square Range of lease

(city, country) meters in each city expiration dates
Zurich, Switzerland Corporate 19,533 Dec.31, 2031 - Dec.31,

Headquarters / 2035
Innovation Lab
Contern, Luxembourg Warehouse 6,000 September 30, 2030
Atlanta, USA Warehouse 44,075 December 31, 2024
Los Angeles, USA Warehouse 32,516 December 31, 2027
Portland, USA Regional Office 5,330 October 31, 2029
New York, USA Regional Office 841 April 30, 2035
Vancouver, Canada Regional Office 109 April 30, 2025
Hanoi, Vietnam Regional Office 817 May 31, 2026
Ho Chi Minh, Vietnam Regional Office 547 May 31, 2026
Melbourne, Australia Regional Office 515 Dec.30, 2026 - Mar.31,
São Paolo, Brazil Regional Office 300 July 15, 2024
Shanghai, China Regional Office 1,557 December 31, 2024
Yokohama, Japan Regional Office 480 April 14, 2025
Berlin, Germany Regional Office 2,569 January 31, 2031
In addition, we operate 10 retail stores around the world. We are also expanding our warehouse
capabilities in Europe to facilitate our future omnichannel growth and lower our handling cost over time
through warehouse automation. As such, in the second quarter of 2023, On entered into a ten-year third
party logistics and warehouse services lease agreement in Belgium. This agreement will expand On's
warehouse space in Europe by 40,000 square meters, which is expected to be ready for use in the
second quarter of 2026. As a result of this agreement, in 2023, On will gradually relocate its Luxembourg
operations to this new automated warehouse and decommission it completely in 2026.
We are also expanding our warehouse capabilities in Atlanta, USA to facilitate our future
omnichannel growth in North America and lower our handling cost over time through warehouse
automation. As such, in 2022 we entered into a twelve-year (two-year ramp-up and 10-year duration)
third party logistics and warehouse services lease agreement that will expand On's warehouse space by
95,274 square meters, with 47,637 square meters to be ready for use in January 2024 and another
47,637 square meters expected to be ready for use in December 2025. This warehouse will include a
highly automated warehouse solution. As such, by 2026, On will move its full warehouse operation in
Atlanta, USA to this 95,274 square meter highly automated site and will decommission the current
Atlanta, USA warehouse location of 44,075 square meters.
ITEM 4A. UNRESOLVED STAFF COMMENTS

None.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

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
elsewhere in 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
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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 and for the fiscal years ended
December 31, 2023 and 2022 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 2022 compared to 2021 refer to “Operating and Financial Review and
Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2022, filed on March
21, 2023, with the United States Securities and Exchange Commission and available at www.sec.gov.
A. Operating Results
Overview
On is a premium performance sportswear brand rooted in innovation, design and sustainability
that has built a passionate global community of fans across more than 60 countries. We focus on
providing a premium product experience to customers wherever they are and our brand resonates with
our loyal customers around the world.
We believe our Swiss heritage and our focus on innovating at the cutting edge of performance,
design and sustainability differentiates us from other sports brands. We are committed to creating
premium products that deliver strong performance. Our relentless culture of innovation has driven us to
repeatedly introduce numerous groundbreaking technologies that are designed to change the
experience of running and create continuous excitement for our fans as we bring new products to
market. Building off our heritage of supporting the runner, we have applied our expertise to creating
performance products for a broader set of global consumers who use them in everyday life, expanding
our product range beyond Performance Running to Performance Outdoor, Performance All Day,
Performance Tennis and Performance Training.
On operates as a single-brand consumer products business and therefore has a single
reportable segment. In 2023, we continued our focus on the following growth strategies: i) growing
overall brand awareness and our community; ii) leveraging innovation leadership to broaden our product
portfolio, iii) expanding geographic footprint through controlled, multi-channel growth; and iv) driving
operational efficiencies to improve overall financial and operating performance (see “Item 4 —
Information on the Company — Business Overview”).
On has continued to successfully execute on its growth strategies and increased net sales for
2023 by 46.6% to CHF 1,792.1 million compared to 2022. This was propelled by a synergy of organic
growth, fueled by heightened consumer demand for our brand across diverse sales channels, product
categories, and geographic regions, complemented by strategic expansion into new product offerings
and geographical markets.
We continued to expand our wholesale channel beyond specialty running stores. Our products
are available in some of the most reputable general sporting, outdoor, fashion and lifestyle retailers in the
world and in a total of approximately 10,000 retail stores across our direct markets. We continued to
intensify and expand our collaboration with global key accounts, including Foot Locker, JD Sports,
Nordstrom, and Dicks Sporting Goods. The wholesale channel accounted for 62.5% of net sales in
2023.
With our community and brand awareness growing globally, in 2023 we also continued to
organically scale our DTC channel through e-commerce and expand our own-retail footprint, opening
retail stores in London, New York City, Miami and Paris. Our DTC channel as a whole, which includes
our e-commerce sites, 22 retail stores in China, and ten retail stores in Europe, United States, and
Japan, represented 37.5% of net sales in 2023.
On continued to innovate and introduced new products in 2023 which included various
groundbreaking technologies designed to change the experience of running and create continuous
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excitement for consumers. The technologies employed in our products included proprietary CloudTec,
CloudTec Phase, Helion superfoam and Speedboard.
The evolution and expansion of our product assortment has contributed meaningfully to our net
sales growth, led by new and existing blockbuster Performance Running products such as the
Cloudsurfer, the Cloudmonster or the Cloudswift, as well as Performance All Day products such as the
Cloud, Cloudnova or the Roger Franchise. We also continued to extend our apparel and accessories line
which brought new fans to the On brand across all regions.
Key Financial Highlights

Key highlights for fiscal year 2023 compared to fiscal year 2022 included:
• net sales increased 46.6% to CHF 1,792.1 million;
• net sales through the DTC sales channel increased 50.9% to CHF 671.8 million;
• net sales through the wholesale sales channel increased 44.2% to CHF 1,120.3 million;
• net sales in Europe, Middle East and Africa (“EMEA”), Americas and Asia-Pacific
increased 29.2% to CHF 488.7 million, 52.2% to CHF 1,162.2 million and 75.9% to CHF
141.1 million, respectively;
• net sales from shoes, apparel and accessories increased 46.6% to CHF 1,711.4 million,
45.5% to CHF 68.9 million and 60.7% to CHF 11.8 million, respectively;
• gross profit increased 55.8% to CHF 1,067.2 million from CHF 684.9 million;
• gross profit margin increased to 59.6% from 56.0%;
• net income increased 37.9% to CHF 79.6 million from CHF 57.7 million;
• basic earnings per share (“EPS”) Class A (CHF) increased to 0.25 from 0.18;
• diluted EPS Class A (CHF) increased to 0.25 from 0.18;
• adjusted EBITDA increased 67.6% to CHF 276.9 million from CHF 165.3 million;
• adjusted EBITDA margin increased to 15.5% from 13.5%;
• adjusted net income increased to CHF 112.4 million from CHF 90.6 million;
• adjusted basic EPS Class A (CHF) increased to 0.35 from 0.29; and
• adjusted diluted EPS Class A (CHF) increased to 0.35 from 0.28.
Key highlights as of December 31, 2023 compared to December 31, 2022 included:
• cash and cash equivalents increased 33.3% to CHF 494.6 million from CHF 371.0
million; and
• net working capital was CHF 496.2 million as of December 31, 2023 which reflects an
increase of 8.1% compared to December 31, 2022.
Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted
diluted EPS and net working capital are non-IFRS measures used by us to evaluate our performance.
Furthermore, we believe adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted
basic EPS, adjusted diluted EPS and net working capital 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. Adjusted EBITDA, adjusted EBITDA
margin, adjusted net income, adjusted basic EPS, adjusted diluted EPS and net working capital should
not be considered in isolation or as a substitute for other financial measures calculated and presented in
accordance with IFRS Accounting Standards. For a detailed description and a reconciliation to the
nearest IFRS Accounting Standards measure, see the section below titled “Non-IFRS Measures”.
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Summary of Financial Performance

The following table summarizes certain key operating measures for the fiscal years ended
December 31, 2023, 2022 and 2021, and for the three-month periods ended December 31, 2023 and
2022. See “—Results of Operations” for additional details and for the comparison discussions between
the years ended December 31, 2023 and 2022 (audited) and the three-month periods ended December
31, 2023 and 2022 (unaudited).
Fiscal year ended December 31, Three-month period ended

December 31,
(CHF in millions) 2023 2022 2021 2023 2022
Net sales 1,792.1 1,222.1 724.6 447.1 366.8

Gross profit 1,067.2 684.9 430.3 270.2 214.6
Operating result 180.2 85.1 (141.1) 40.8 14.7
Net income / (loss) 79.6 57.7 (170.2) (26.8) (26.4)
Net income / (loss) 4.4 % 4.7 % (23.5)% (6.0)% (7.2)%
margin
Basic EPS Class A 0.25 0.18 (0.59) (0.08) (0.08)

(CHF)
Diluted EPS Class A 0.25 0.18 (0.59) (0.08) (0.08)
(CHF)
Other data(1)
Adjusted EBITDA 276.9 165.3 96.4 71.9 61.8
Adjusted EBITDA 15.5 % 13.5 % 13.3 % 16.1 % 16.8 %
margin
Adjusted net income 112.4 90.6 31.1 (16.3) 7.5
Adjusted basic EPS 0.35 0.29 0.11 (0.05) 0.02
Class A (CHF)
Adjusted diluted EPS 0.35 0.28 0.11 (0.05) 0.02
Class A (CHF)
(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 Accounting
Standards measure.
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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 when goods have been shipped or
delivered to the customer’s specified location, in accordance with the applicable incoterms. Following
delivery, the customer has the primary responsibility when further selling the goods and bears the risks
of obsolescence and loss in relation to the goods. Net sales within the wholesale sales channel are sales
net of any discounts or volume rebates.
Net sales within the DTC sales channel are recognized when control of the goods has been
transferred from On to the customer, namely upon shipment 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. Once the control of goods has transferred, a
refund liability (other current financial liabilities) and a corresponding adjustment to net sales is
recognized for those products expected to be returned. At the same time, On has a right to recover the
product when customers exercise their right of return, and so consequently On recognizes a right to
returned goods asset (other current operating assets) and a corresponding adjustment to cost of sales.
Cost of Sales
We outsource 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 U.S. dollars. Other cost of
sales relate to personnel expenses in connection with sourcing materials and quality control,
depreciation charges for production tools, in-bound freight expenses, 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 expenses (“SG&A expenses”) expenses generally
consist of selling, marketing, distribution, general and administrative expenses, and share-based
compensation.
Selling expenses support our customer relationships and enable the delivery of products to
wholesale customers and end customers through our e-commerce platform and owned retail stores.
These expenses include: personnel expenses for sales and technical representatives, paying processing
fees in the DTC sales channel and depreciation expenses. 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 and end customers. Selling and distribution
expenses are generally correlated to net sales. As a percentage of sales, we expect selling costs to
decrease as the business achieves economies of scale as we continue to grow.
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, travel, product display expenses and overhead costs. We intend to
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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, depreciation, amortization related to software and patents and other rights.
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. We have and expect to continue to incur a
significant increase in accounting, legal and professional fees associated with being a public company.
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.
Financial Result
Financial result includes income from interest earned on short-term investments, less financial
expenses consisting primarily of bank charges and interest expenses as a result of our financial leases
and commitment fees paid for bank overdraft facilities, 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 United States, Japan and Germany.
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Results of Operations
For the Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022
The following table summarizes results of operations and expresses the percentage relationship
to net sales of certain financial statement captions.

(CHF in millions) 2023 2022 % Change
Net sales 1,792.1 1,222.1 46.6 %

Cost of sales (724.8) (537.2) 34.9 %
Gross profit 1,067.2 684.9 55.8 %
Gross profit margin 59.6 % 56.0 %
Selling, general and administrative expenses (887.0) (599.8) 47.9 %
Operating result 180.2 85.1 111.8 %
Net financial result (111.1) (7.2) 1439.9 %
Income before taxes 69.1 77.9 (11.2)%
Income tax benefit / (expense) 10.5 (20.2) 151.9 %
Net income 79.6 57.7 37.9 %
Net sales
Net sales by sales channel
The following table presents net sales by sales channel:

Wholesale 1,120.3 777.0 44.2 %

Direct-to-Consumer 671.8 445.1 50.9 %
Net sales 1,792.1 1,222.1 46.6 %
Wholesale % of Net sales 62.5 % 63.6 %

Direct-to-Consumer % of Net sales 37.5 % 36.4 %
Net sales % 100.0 % 100.0 %
Net sales for 2023 increased by CHF 569.9 million, or 46.6%, compared to 2022.
Net sales generated by the wholesale sales channel for 2023 increased by CHF 343.2 million, or
44.2%, to CHF 1,120.3 million, compared to CHF 777.0 million in 2022. The increase was attributable to
sustained strong demand from our wholesale partners and our continued selective door expansion,
particularly with global key accounts such as Dick's Sporting Goods, Foot Locker, JD Sports and
Nordstrom. The strong growth was also attributable to the improved inventory position in comparison to
the year ended December 31, 2022, which was impacted by the transitory supply shortage in connection
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with the disruptions to global supply chains in early 2022. As a result of the ongoing strategic ambition
for our DTC sales channel to outgrow our wholesale sales channel, net sales generated by the wholesale
sales channel as a percentage of net sales slightly decreased to 62.5% for the year ended December 31,
2023, from 63.6% for the year ended December 31, 2022.
Net sales generated by the DTC sales channel for 2023 increased by CHF 226.7 million, or
50.9%, to CHF 671.8 million, compared to CHF 445.1 million in 2022. 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. The number of visits to
our e-commerce platform increased 63.0% from 142.5 million visits during 2022 to 232.3 million visits
during 2023. Additionally, our expanding global retail footprint across all regions further contributed to
the growth. By December 31, 2023, we operated 10 own retail stores outside of China and 22 in China.
Net sales generated from the DTC channel as a percentage of net sales increased to 37.5% for fiscal
year 2023 compared to 36.4% for fiscal year 2022.
Net sales by geography

The following table presents net sales by geographic region (based on the location of the
counterparty):

Europe, Middle East and Africa 488.7 378.1 29.2 %

Americas 1,162.2 763.8 52.2 %
Asia-Pacific 141.1 80.2 75.9 %
Net Sales 1,792.1 1,222.1 46.6%
Europe, Middle East and Africa % of Net sales 27.2 % 30.9 %

Americas % of Net sales 64.9 % 62.5 %
Asia-Pacific % of Net sales 7.9 % 6.6 %
Net sales % 100.0 % 100.0 %
As announced through Current Report on Form 6-K filed with the U.S. Securities and Exchange
Commission on May 2, 2023, effective from the first quarter of 2023, the “Rest of World” geographic
location, which represented Middle East, Africa and Latin America is no longer being reported. Instead,
our Middle East and Africa business has been combined with Europe to form Europe, Middle East and
Africa (“EMEA”) and our Latin America business has been combined with North America to form
Americas. As such, net sales by geography for the three-month period and 12-month period ended
December 31, 2022 has been adjusted from previously reported amounts to reflect the new net sales by
geography structure.
Net sales increased across all geographic regions in 2023 with Asia-Pacific showing particularly
strong growth. Net sales growth of 52.2% 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
successful expansion of our collaboration with key account partners. Net sales growth of 29.2% in
EMEA was driven by positive growth across both the wholesale and direct-to-consumer channels, with
particularly strong growth in the United Kingdom and the successful retail store on Regent Street in
London. Net sales growth of 75.9% in Asia-Pacific was primarily driven by strong sales growth in Japan
and China.
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Net sales by product

The following table presents net sales by product group:
Shoes 1,711.4 1,167.5 46.6 %

Apparel 68.9 47.3 45.5 %
Accessories 11.8 7.4 60.7 %
Net Sales 1,792.1 1,222.1 46.6 %
Shoes % of Net sales 95.5 % 95.5 %

Apparel % of Net sales 3.8 % 3.9 %
Accessories % of Net sales 0.7 % 0.6 %
Net sales % 100.0 % 100.0 %
The 46.6% increase in net sales for shoes in 2023 compared to 2022 was driven by a
combination of new product launches, updates to existing models, and the continuity of successful
products carrying over from previous seasons. Growth was primarily driven by our Performance Running
and Performance All Day verticals. The Roger franchise, benefiting continuously from the increased
brand presence at Grand Slam events, further contributed meaningfully to our growth in net sales.
The 45.5% increase in net sales in 2023 for apparel was primarily driven by the strength of products in
the Performance All Day and Performance Outdoor verticals. The existing and new collections within the
apparel range have continued to show positive momentum at our own retail stores in particular.
Additionally, the collections continue to garner positive feedback from our wholesale partners,
particularly when showcased in shop-in-shop-environments, where we observe a higher share of
apparel sales.
Gross Profit

Gross profit 1,067.2 684.9 55.8 %

Cost of sales for 2023 increased by CHF 187.6 million, or 34.9%, to CHF 724.8 million,
compared to CHF 537.2 million in 2022. The resulting gross profit was CHF 1,067.2 million in 2023,
representing a gross profit margin of 59.6%, compared with CHF 684.9 million in 2022, representing a
gross profit margin of 56.0%. The increase in gross profit margin is attributable to the ceasing of
exceptional airfreight usage and overall reduced freight rates in 2023, when compared to the
comparable period in 2022. In 2022, we had made a strategic decision to employ airfreight to ensure key
product availability and meet strong demand, considering the factory closures in Vietnam in the latter
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part of 2021. The gross profit margin was further supported by the higher share of net sales through the
DTC channel in 2023, when compared to the comparable period in 2022.

Net sales 1,792.1 1,222.1 46.6 %

Distribution expenses (239.5) (151.0) 58.6 %
Selling expenses (133.3) (85.5) 55.8 %
Marketing expenses (195.8) (130.2) 50.4 %
Share-based compensation (31.8) (33.8) (5.8)%
General and administrative expenses (286.6) (199.3) 43.8 %
SG&A expenses (887.0) (599.8) 47.9 %
Less share-based compensation (31.8) (33.8) (5.8)%
SG&A (excluding share-based compensation) (855.2) (566.0) 51.1 %
Distribution expenses % of Net sales 13.4 % 12.4 %

Selling expenses % of Net sales 7.4 % 7.0 %
Marketing expenses % of Net sales 10.9 % 10.7 %
Share-based compensation % of Net sales 1.8 % 2.8 %
General and administrative expenses % of Net sales 16.0 % 16.3 %
SG&A expenses % of Net sales 49.5 % 49.1 %
SG&A (excluding share-based compensation) % of 47.7 % 46.3 %
Net sales
SG&A expenses for the full year 2023 increased by CHF 287.2 million to CHF 887.0 million,
compared to CHF 599.8 million in 2022. Excluding share-based compensation, SG&A expenses as a
percentage of net sales increased to 47.7% in 2023 from 46.3% in 2022.
The drivers for the fluctuations in SG&A expenses can be summarized as follows:
• Distribution expenses as a percentage of net sales, increased to 13.4% in 2023 compared
to 12.4% in 2022. This was primarily due to the implementation of new warehouse
automation initiatives in the United States and Belgium, incurring investment costs and
allowing for a ramp-up in distribution capacity. Additionally, in the first two quarters of 2023,
we incurred incremental expenses for temporary additional warehouse capacity, required as
a result of the accelerated supply chain normalization.
• Selling expenses as a percentage of net sales, increased to 7.4% in 2023 compared to
7.0% in 2022. The increase was driven by additional expenses incurred as a result of our
expanding retail footprint. Additionally, the increase was a result of a one-off bad debt
provision made as a result of an insolvency case involving a wholesale customer in central
Europe in the third quarter.
• Marketing expenses as a percentage of net sales increased to 10.9% in 2023 compared to
10.7% in 2022. The increase was primarily a reflection of the somewhat reduced marketing
expenses in the second half of 2022, as we held back on some brand building efforts to
digest some of the higher freight costs in early 2022. The year-over-over absolute increase
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in marketing spend reflects our significant investment in brand building initiatives, including
those focused on our athletes, innovation, sportswear, tennis and performance running,
such as the On track nights events in key cities across Europe.
• Share-based compensation expenses decreased by CHF 2.0 million to CHF 31.8 million in
2023 from CHF 33.8 million in 2022. The decrease is a reflection of the expense in 2023
resulting from newly issued grants with extended vesting period and corresponding share-
based compensation expenses that are distributed over multiple periods. In 2022, expenses
had largely resulted from awards with fulfilled vesting requirements and corresponding full
expense during the period.
• General and administrative expenses as a percentage of net sales, decreased to 16.0% in
2023 compared to 16.3% in 2022. This decrease is a reflection of the strategic ambition to
increase efficiencies across various areas of the business and achieve economies of scale
as we become a larger organization.
Depreciation and Amortization

Depreciation and amortization 64.9 46.4 39.8 %

Depreciation and amortization % of Net sales 3.6 % 3.8 %
Depreciation and amortization expenses for 2023 increased by CHF 18.5 million, or 39.8%, to
CHF 64.9 million, compared to CHF 46.4 million in 2022. Thereof, depreciation and amortization
expenses attributable to owned assets increased by CHF 8.6 million as a result of office and retail
expansion, mainly related to leasehold improvements, furniture and fixtures, IT hardware, and a change
in the estimated useful life of production tools during the second half of 2022. In addition, depreciation
and amortization expenses attributable to right of use assets increased by CHF 9.9 million as a result of
a new storage and warehousing facility in Los Angeles, California, as well as the expansion of retail
stores, mainly in the U.S, China and the UK.
Net Financial Result
Financial income 11.5 5.7 100.0 %

Financial expenses (11.3) (6.4) 75.9 %
Foreign exchange result (111.4) (6.5) 1603.9 %
Financial income for 2023 increased by CHF 5.8 million due to short-term investments and
increased interest rates. Financial expenses for 2023 increased by CHF 4.9 million, or 75.9%, to CHF
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11.3 million, compared to CHF 6.4 million in 2022, due to bank charges and interest expenses mainly
due to the commitment fees paid for the CHF 700 million multicurrency credit facility entered into on July
7, 2023. Bank charges and interest expenses as of December 31, 2022 mainly included commitment
fees paid for the three bank overdraft facilities and interest expense associated with leases. Net foreign
exchange results (FX) in 2023 resulted in an increased loss of CHF 104.8 million to CHF 111.4 million,
compared to CHF 6.5 million in 2022. FX losses are primarily due to the negative effect of the translation
of our monetary assets given period end closing exchange rates, in particular the CHF/USD exchange
rate.
Income Tax Expense / (Benefit)

Current income taxes 35.7 38.7 (7.8) %

Deferred income taxes (46.2) (18.6) 148.7 %
Income tax expense / (benefit) (10.5) 20.2 (151.9)%
Income taxes for 2023 decreased by CHF 30.6 million, or 151.9%, resulting in an income tax
benefit of CHF 10.5 million, compared to CHF 20.2 million income tax expense in 2022. Our effective
income tax rate was (15.1%) for 2023, compared to 25.9% 2022. The decrease in the effective income
tax rate is primarily a result of increased efficacy of tax incentives in Switzerland in connection with
patents, which was even more effective in 2023 than 2022, due to higher profitability of our Swiss
entities. Another positive impact on the 2023 effective tax rate is attributable to securing prior year tax
deductions in 2023 in connection with our share-based payment plans. In order to determine these tax
benefits, a detailed analysis of prior financial years and extensive documentation was required but not
available during the original filing.
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Three-month period ended December 31, 2023 compared to the three-month period ended
December 31, 2022 (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,

Net sales 447.1 366.8 21.9 %

Cost of sales (176.9) (152.2) 16.2 %
Gross profit 270.2 214.6 25.9 %
Selling, general and administrative expenses (229.4) (199.9) 14.8 %
Operating result 40.8 14.7 177.8 %
(Loss) before taxes (45.0) (24.4) 83.9 %
Income tax benefit / (expense) 18.2 (2.0) 1025.1 %
Net loss (26.8) (26.4) 1.3 %
Net sales
Net sales by sales channel
The following table presents net sales by sales channel:
Wholesale 240.5 217.3 10.7 %

Direct-to-Consumer 206.6 149.4 38.2 %
Net sales 447.1 366.8 21.9 %
Wholesale % of Net sales 53.8 % 59.3 %

Direct-to-Consumer % of Net sales 46.2 % 40.7 %
Net sales % 100.0 % 100.0 %
Net sales for the three-month period ended December 31, 2023 increased by CHF 80.3 million,
or 21.9%, compared to the three-month period ended December 31, 2022.
Net sales generated by the wholesale sales channel for the three-month period ended December
31, 2023 increased by CHF 23.2 million, or 10.7%, to CHF 240.5 million, compared to CHF 217.3 million
for the three-month period ended December 31, 2022. The increase was attributable to sustained strong
demand from our wholesale partners and our continued selective door expansion, particularly with
global key accounts such as Dick's Sporting Goods, Foot Locker, JD Sports and Nordstrom. The
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wholesale growth rate was somewhat held back by anticipated year-over-year dynamics given that in
the three-month period ending September 30, 2022, operational challenges in the U.S. prevented us
from meeting the full demand for our products, resulting in a shift of volumes to the fourth quarter of
2022 and corresponding elevated comparison period. As a result of these prior year dynamics, as well
as the ongoing strategic ambition for our DTC sales channel to outgrow our wholesale sales channel, net
sales generated by the wholesale sales channel as a percentage of net sales decreased to 53.8% for the
three-month period ended December 31, 2023, from 59.3% for the three-month period ended December
31, 2022.
Net sales generated by the DTC sales channel for the three-month period ended December 31,
2023 increased by CHF 57.1 million, or 38.2%, to CHF 206.6 million, compared to CHF 149.4 million for
the three-month period ended December 31, 2022. 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, our expanding global
retail footprint across all regions further contributed to the growth. Net sales generated from the DTC
channel as a percentage of net sales increased to 46.2% for the three-month period ended December
31, 2023 compared to 40.7% for the three-month period ended December 31, 2022.
Net sales by geography

The following table presents net sales by geographic region (based on the location of the
counterparty):
Europe, Middle East and Africa 112.5 91.5 22.9 %

Americas 300.6 253.7 18.5 %
Asia-Pacific 34.0 21.6 57.7 %
Net Sales 447.1 366.8 21.9%
Europe, Middle East and Africa % of Net sales 25.2 % 24.9 %

Americas % of Net sales 67.2 % 69.2 %
Asia-Pacific % of Net sales 7.6 % 5.9 %
Net sales % 100.0 % 100.0 %
Net sales increased across all geographic regions for the three-month period ended
December 31, 2023, with Asia-Pacific showing particularly strong growth. Americas continues to be a
key growth market where net sales for the three-month period ended December 31, 2023 increased by
18.5% compared to the prior year period and makes up 67.2% of total net sales. The increase 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, and particularly the successful expansion of our collaboration with
key account partners. The Americas growth rate was somewhat held back by anticipated year-over-year
dynamics given that in the three-month period ending September 30, 2022, operational challenges in the
U.S. prevented us from meeting the full demand for our products, resulting in a shift of volumes to the
fourth quarter of 2022 and corresponding elevated comparison period. Net sales in EMEA for the three-
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month period ended December 31, 2023 increased by 22.9% compared to the prior year period. The
increase in EMEA was driven by particularly strong growth in our DTC channel as well as ongoing
strength in the United Kingdom and our retail stores in the region. The overall growth rate in EMEA was
somewhat held back by the upcoming discontinuation of certain non-strategic wholesale partnerships in
the region, which had an initial impact in the three-month period ended December 31, 2023. Net sales in
Asia-Pacific for the three-month period ended December 31, 2023 increased by 57.7% compared to the
prior year period. The increase was driven by strong sales growth across all sub-regions and channels,
including particularly strong momentum in Japan and China.
Net sales by product

The following table presents net sales by product group:

Shoes 425.7 353.4 20.4 %

Apparel 18.4 11.5 60.1 %
Accessories 2.9 1.8 60.1 %
Net Sales 447.1 366.8 21.9 %
Shoes % of Net sales 95.2 % 96.4 %

Apparel % of Net sales 4.1 % 3.1 %
Accessories % of Net sales 0.6 % 0.5 %
Net sales % 100.0 % 100.0 %
The 20.4% increase in net sales for shoes for the three-month period ended December 31,
2023, compared to the three-month period ended December 31, 2022, was driven by a combination of
new product launches, updates to existing models, and the continuity of successful products carrying
over from previous seasons. Growth was primarily driven by our Performance Running and Performance
All Day verticals. The Roger franchise, benefiting continuously from the increased brand presence at
Grand Slam events, further contributed meaningfully to our growth in net sales.
The 60.1% increase in net sales for apparel for the three-month period ended December 31,
2023, compared to the three-month period ended December 31, 2022. The strong increase reflects the
strategic emphasis we are placing on apparel in order to establish On as a true head-to-toe brand.
Growth was primarily driven by the strength of products in the Performance All Day and Performance
Outdoor verticals. The existing and new collections within the apparel range have continued to show
positive momentum at our own retail stores and by way of increased traffic and transactions on our e-
commerce platform. Additionally, the collections continue to garner positive feedback from our
wholesale partners, particularly when showcased in shop-in-shop-environments, where we observe a
higher share of apparel sales.
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Gross Profit

Gross profit 270.2 214.6 25.9 %

Cost of sales during the three-month period ended December 31, 2023 increased by CHF 24.7
million, or 16.2%, to CHF 176.9 million, compared to CHF 152.2 million during the three-month period
ended December 31, 2022. Gross profit was CHF 270.2 million for the three-month period ended
December 31, 2023, representing a gross profit margin of 60.4%, compared with CHF 214.6 million for
the three-month period ended December 31, 2022, representing a gross profit margin of 58.5%. The
increase in gross profit margin is attributable to the limited airfreight usage and overall reduced freight
rates in the three-month period ended December 31, 2023, compared to the three-month period ended
December 31, 2022. The gross profit margin was further supported by the higher DTC share in the year-
over-year comparison as well as our ongoing commitment to maintain a high share of full-price sales.

Net sales 447.1 366.8 21.9 %

Distribution expenses (54.5) (43.9) 24.2 %
Selling expenses (38.0) (29.5) 28.9 %
Marketing expenses (47.9) (33.5) 43.3 %
Share-based compensation (10.8) (34.4) (68.6) %
General and administrative expenses (78.1) (58.6) 33.2 %
SG&A expenses (229.4) (199.9) 14.8 %
Less share-based compensation (10.8) (34.4) (68.6) %
SG&A (excluding share-based compensation) (218.6) (165.5) 32.1 %
Distribution expenses % of Net sales 12.2 % 12.0 %

Selling expenses % of Net sales 8.5 % 8.0 %
Marketing expenses % of Net sales 10.7 % 9.1 %
Share-based compensation % of Net sales 2.4 % 9.4 %
General and administrative expenses % of Net sales 17.5 % 16.0 %
SG&A expenses % of Net sales 51.3 % 54.5 %
SG&A (excluding share-based compensation) % of 48.9 % 45.1 %
Net sales
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SG&A expenses for the three-month period ended December 31, 2023 increased by CHF 29.5
million to CHF 229.4 million, compared to CHF 199.9 million for the three-month period ended
December 31, 2022. Excluding share-based compensation, SG&A expenses as a percentage of net
sales increased to 48.9% in the three month period ended December 31, 2023 compared to 45.1% for
the three-month period ended December 31, 2022.
The drivers for the reduction in SG&A expenses can be summarized as follows:
• Distribution expenses as a percentage of net sales increased to 12.2% during the three-
month period ended December 31, 2023 compared to 12.0% during the three-month period
ended December 31, 2022. This included an increase due to the implementation of new
warehouse automation initiatives in the United States and Belgium, incurring investment
costs and allowing for a ramp-up in distribution capacity. The increase was partially offset
by one-off reclaimed logistics expenses.
• Selling expenses as a percentage of net sales increased to 8.5% during the three-month
period ended December 31, 2023 compared to 8.0% during the three-month period ended
December 31, 2022. The increase was primarily driven by additional expenses incurred as a
result of our expanding retail footprint.
• Marketing expenses as a percentage of net sales increased to 10.7% during the three-
month period ended December 31, 2023 compared to 9.1% during the three-month period
ended December 31, 2022. The increase was primarily a reflection of the somewhat
reduced marketing expenses in the three-month period ended December 31, 2022, as we
held back on some brand building efforts to digest some of the higher freight costs in early
2022. The year-over-over absolute increase in marketing spend reflects our higher
investment in brand building initiatives, including bigger brand campaigns focused on our
evolving apparel offering.
• Share-based compensation expenses decreased by CHF 23.6 million to CHF 10.8 million
during the three-month period ended December 31, 2023 from CHF 34.4 million during the
three-month period ended December 31, 2022. The significant decrease is a reflection of
the expense in the three-month period ended December 31, 2023 resulting from grants
issued earlier in the year with extended vesting period and corresponding share-based
compensation expenses that are distributed over multiple periods. In the three-month
period ended December 31, 2022, expenses had largely resulted from awards that were
granted and immediately vested during the quarter and were correspondingly expensed in
full during the period.
• General and administrative expenses as a percentage of net sales increased to 17.5%
during the three-month period ended December 31 2023 compared to 16.0% during the
three-month period ended December 31, 2022. This increase is largely a reflection of the
somewhat different net sales phasing in 2023 than in 2022, where a higher percentage of
annual net sales had been recorded in the fourth quarter. The year-over-year absolute
increase in general and administrative expenses is mainly driven by the additional full-time
employees ("FTEs") onboarded during the course of the year to support our ongoing growth
path as well as corresponding expenses for additional software licenses and development
projects.
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Depreciation and Amortization

Depreciation and amortization 20.3 12.7 59.7%

Depreciation and amortization % of Net sales 4.5 % 3.5 %
Depreciation and amortization expenses during the three-month period ended December 31,
2023 increased by CHF 7.6 million to CHF 20.3 million, compared to CHF 12.7 million during the three-
month period ended December 31, 2022. Thereof, depreciation and amortization expenses attributable
to owned assets increased by CHF 1.3 million as a result of office and retail expansion, mainly related to
leasehold improvements, furniture and fixtures and IT hardware. In addition, depreciation and
amortization expenses attributable to right of use assets increased by CHF 6.3 million as a result of a
new storage and warehousing facility in Los Angeles, California.
Net Financial Result

Financial income 4.2 2.5 71.2 %

Financial expenses (4.5) (0.9) 389.8 %
Foreign exchange result (85.5) (40.7) 110.1 %
Financial income for the three-month period ended December 31, 2023 increased by CHF 1.8
million, primarily driven by our short-term investments and increased interest rates. Financial expenses
for the three-month period ended December 31, 2023 increased by CHF 3.6 million, or 389.8%, to CHF
4.5 million, compared to CHF 0.9 million for the three-month period ended December 31, 2022 due to
bank charges and interest expenses mainly due to the commitment fees paid for the CHF 700 million
multicurrency credit facility entered into on July 7, 2023. Net foreign exchange expense for the three-
month period ended December 31, 2023 increased by CHF 44.8 million to CHF 85.5 million, compared
to CHF 40.7 million for the three-month period ended December 31, 2022 primarily due to the negative
effect of our monetary assets from the fluctuation in exchange rates, in particular the CHF/USD
exchange rate.
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Income Tax Expense / (Benefit)

Current income taxes (11.4) 13.5 -183.9%

Deferred income taxes (6.8) (11.6) -40.9%
Income tax expense / (benefit) (18.2) 2.0 -1025.1%
Income taxes during the three-month period ended December 31, 2023 resulted in an income
tax benefit of CHF 18.2 million, compared to CHF 2.0 million income tax expense during the three-month
period ended December 31, 2022. The decrease in current taxes in the three-month period ending
December 31, 2023 is mainly attributable to securing prior year tax deductions in 2023 in connection
with our share-based payment plans. In order to determine these tax benefits, a detailed analysis of prior
financial years and extensive documentation was required but not available during the original filing.
The deferred tax benefits in the three-month period ending December 31, 2023 are mainly due
to the tax deferral of expenses in connection with the US capitalization rules (UNICAP). However,
deferred tax income is lower compared to the three-month period ended December 31, 2022 due to
deferred tax expenses in connection with the use of tax loss carryforwards in 2023.
Non-IFRS Measures
Adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted basic EPS, adjusted
diluted EPS and net working capital are financial measures that are not defined under the IFRS
Accounting Standards.
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
accordance with IFRS Accounting Standards, 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 and net working capital should not be considered in isolation or as a substitute for
other financial measures calculated and presented in accordance with IFRS Accounting Standards and
may not be comparable to similarly titled non-IFRS measures used by other companies. The tables
below reconcile each non-IFRS measure to its most directly comparable IFRS Accounting Standards
measure.
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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 comparable period.
Fiscal year ended December 31, Three-month period ended
December 31,
(CHF in millions) 2023 2022 % Change 2023 2022 % Change
Net income / (loss) 79.6 57.7 37.9 % (26.8) (26.4) 1.3 %

Exclude the impact
of:
Income taxes (10.5) 20.2 (151.9)% (18.2) 2.0 (1025.1) %
Financial income (11.5) (5.7) 101.2 % (4.2) (2.5) 71.2 %
Financial expenses 11.3 6.4 75.9 % 4.5 0.9 389.8 %
Foreign exchange 111.4 6.5 1603.9 % 85.5 40.7 110.1 %
result(1)
Depreciation and 64.9 46.4 39.8 % 20.3 12.7 59.7 %
amortization
Share-based 31.8 33.8 (5.8)% 10.8 34.4 (68.6) %
compensation(2)
Adjusted EBITDA 276.9 165.3 67.6 % 71.9 61.8 16.3 %
Adjusted EBITDA 15.5% 13.5% 16.1% 16.8%
margin
(1) Represents the foreign exchange impact within the net financial result.
(2) Represents non-cash share-based compensation expense.
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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 Accounting Standards measures.
Adjusted basic EPS is used in conjunction with other non-IFRS measures and excludes certain
items (as listed below) in order to increase comparability of the metric from period to period, which we
believe makes it useful for management, our audit committee and investors to assess our financial
performance over time.
Diluted EPS is calculated by dividing net income by the weighted average number of ordinary
shares outstanding during the period on a fully diluted basis. 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.
The table below provides a reconciliation between net income / (loss) to adjusted net income,
adjusted basic EPS and adjusted diluted EPS for the periods presented:

(CHF in millions, except per share data) 2023 2023 2022 2022
Class A Class B Class A Class B
Net income 70.9 8.6 51.4 6.3

Exclude the impact of:
Share-based compensation(1) 28.4 3.4 30.1 3.7
Tax effect of adjustments(2) 0.9 0.1 (0.8) (0.1)
Adjusted net income 100.2 12.2 80.7 9.9
Weighted number of outstanding 284,262,802 345,437,500 282,195,495 345,437,500

shares(3)
Weighted number of shares with 3,306,122 11,446,403 2,354,500 6,891,423
dilutive effects(3)(4)
shares (diluted and undiluted)(3)(4)
Adjusted basic EPS (CHF) 0.35 0.04 0.29 0.03

Adjusted diluted EPS (CHF) 0.35 0.03 0.28 0.03
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(CHF in millions, except per share data) 2023 2023 2022 2022
Class A Class B Class A Class B
Net loss (23.9) (2.9) (23.5) (2.9)

Exclude the impact of:
Share-based compensation(1) 9.6 1.2 30.6 3.7
Tax effect of adjustments(2) (0.3) — (0.4) —
Adjusted net income / (loss) (14.5) (1.8) 6.7 0.8

shares(3)
Weighted number of shares with dilutive — — 1,661,451 6,285,538
effects(3)(4)
shares (diluted and undiluted)(3)(4)
Adjusted basic EPS (CHF) (0.05) (0.01) 0.02 0.00

Adjusted diluted EPS (CHF) (0.05) (0.01) 0.02 0.00
(1) Represents non-cash share-based compensation expense.

(2) The tax effect has been calculated by applying the local tax rate on the tax deductible
portion of the respective adjustments.
(3) Weighted number of outstanding shares (diluted and undiluted) are presented herein in order
to calculate adjusted basic EPS as adjusted Net Income for such periods.
(4) For the three-month period ended December 31, 2023, 3,159,251 shares and 11,325,561
shares were excluded from the diluted EPS calculation for Class A ordinary shares and
Class B voting rights shares, respectively, as the impact of the shares are considered anti-
dilutive.
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.
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Accounts receivables 204.8 174.6 17.3 %

Inventories 356.5 395.6 (9.9) %
Trade payables (65.1) (111.0) (41.3) %
Net working capital 496.2 459.2 8.1 %
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 “—Contractual Obligations and Commitments” below.
We finance our liquidity needs using a combination of cash and cash equivalents balances, cash
provided from operating activities and, to a lesser extent, available borrowings under the new credit
facility we entered into in July 2023 as further detailed in “—Indebtedness” below. As of December 31,
2023, we had CHF 494.6 million of cash and cash equivalents and CHF 496.2 million of net working
capital, compared with CHF 371.0 million of cash and cash equivalents, of which CHF 129.5 million was
restricted, and CHF 459.2 million of net working capital as of December 31, 2022. As at December 31,
2023 and 2022, 94.6% and 90.4%, respectively, of our cash and cash equivalents were held at banks
that are deemed systemically important financial institutions, with remaining balances in banks with an
investment grade rating. Movements in cash and net working capital are discussed below in “—Cash
Flows”.
We believe our existing cash and cash equivalent balances, cash flow from operations and bank
overdraft facilities will be sufficient to meet the net working capital and capital expenditure needs for at
least the next 12 months. 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 seek additional equity or debt
financing. The sale of additional equity would result in additional dilution to shareholders. The incurrence
of debt financing would result in debt service obligations, and the instruments governing such debt
could provide for operating and financing covenants that may restrict our operations. There can be no
assurances that we will be able to raise additional capital on terms that are attractive to us or at all. The
inability to raise capital would adversely affect our ability to achieve our business objectives.
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Cash Flows

Cash inflow / (outflow) from operating activities 232.1 (227.0) 202.2 %

Cash (outflow) from investing activities (47.1) (82.9) (43.1) %
Cash inflow / (outflow) from financing activities (21.8) 6.3 (445.1) %
Change in net cash and cash equivalents 163.2 (303.6) 153.7 %
Net cash and cash equivalents at the beginning of 371.0 653.1 (43.2) %
the period
Net impact of foreign exchange rate differences (39.6) 21.5 (283.8) %
Net cash and cash equivalents 494.6 371.0 33.3 %
Operating activities
Cash inflow from operating activities was CHF 232.1 million for the twelve-month period ended
December 31, 2023, compared with a cash outflow from operating activities of CHF 227.0 million during
the same period in 2022. The increase in cash inflow from operating activities was CHF 257.5 million
generated by net income adjusted for non-cash items, CHF 93.4 million as a result of the change in
other current assets/liabilities and CHF 11.0 million in interest received, partially offset by outflows
resulting from an increase in net working capital of CHF 101.2 million and income taxes paid of CHF
28.6 million. Net working capital increased as a result of increases to trade receivables and inventories
of CHF 46.9 million and CHF 10.0 million, respectively, offset by a decrease in trade payables of CHF
44.3 million.
Cash outflow from operating activities in 2022 was a result of increases to net working capital
expenditures of CHF 285.8 million and income taxes paid of CHF 31.0 million, offset by a favorable
increase of CHF 151.8 million generated by net income adjusted for non-cash items and other current
assets/liabilities of CHF 67.6 million. Net working capital increased as a result of the increase in
inventories of CHF 273.0 million, trade receivables of CHF 78.6 million and trade payables of CHF 65.8
million. The increase in inventories was driven by the strong net sales growth and the continued net
sales growth including new product launches during the spring-summer 2023 season which took place
in the first half of 2023. The increase to trade receivables was primarily driven by net sales growth within
the wholesale sales channel, and the increase of accounts payables was primarily driven by the
increased purchase of products in 2022 compared to 2021.
Investing activities
Cash outflow from investing activities was CHF 47.1 million and CHF 82.9 million for the twelve-
month period ended December 31, 2023 and 2022, respectively. In 2023, cash outflow from investing
activities was driven by CHF 42.8 million investments of tangible assets, including leasehold
improvements for various retail stores, as well as expenditures on production tools and furniture and
fixtures. Additionally, CHF 4.4 million was directed towards investments in intangible assets.
In 2022, cash outflow from investing activities of CHF 82.9 million was driven by leasehold
improvements and furniture and fixtures purchased in connection with new corporate offices, most
notably the On Labs in Zurich and the office in Portland, and the expansion of retail stores primarily in
China, Japan, U.S., UK and Switzerland, registration fees for our intellectual property including domain
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names, investments made into production tools in Vietnam, and trade tools made to deliver the On
experience to the customer at the point of sale.
Financing activities
Cash outflow from financing activities was CHF 21.8 million compared to cash inflow from
financing activities of CHF 6.3 million for the twelve-month period ended December 31, 2023 and 2022,
respectively. In 2023, cash outflow from financing activities was primarily due to 25.5 million and CHF
6.5 million, related to lease liabilities payments and interest paid, respectively, partially offset by CHF 6.4
million in proceeds received for the sale of treasury shares to selected employees in connection with
share-based compensation awards.
In 2022, cash inflow from financing activities included CHF 26.4 million in proceeds received for
the sale of treasury shares to selected employees in connection with share-based compensation
awards, offset by CHF 15.4 million and CHF 4.7 million, related to lease liabilities payments and interest
paid, respectively.
Capital Management

As of December 31, 2023: CHF 0.10 nominal value, 30.0 30.0 —%

299,998,125 Class A Ordinary Shares issued of which
284,215,277 were outstanding
As of December 31, 2022: CHF 0.10 nominal value,
299,998,125 Class A Ordinary Shares issued of which
281,976,387 were outstanding
As of December 31, 2023: CHF 0.01 nominal value, 3.5 3.5 —%
345,437,500 Class B voting rights shares issued and
outstanding
Share capital 33.5 33.5 —%
Treasury shares (26.7) (26.1) 2.3 %
Share premium 756.9 756.9 —%
Legal reserves 42.3 33.8 25.1 %
Equity transaction costs (8.7) (8.7) —%
Tax impact on equity transaction costs 1.3 1.3 —%
Share-based compensation 349.1 321.8 8.5 %
Capital reserves 1,140.8 1,105.1 3.2 %
Other reserves (9.8) — 100.0 %
Accumulated losses (63.3) (142.9) (55.7)%
Equity 1,074.5 969.5 10.8 %
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Class A Class B
Shares Shares
Shares issued and outstanding as of January 1, 2023 281,976,387 345,437,500

Sale of treasury shares related to share-based compensation 2,273,239 —
Purchase of treasury shares (34,349) —
Shares issued and outstanding as of December 31, 2023(1) 284,215,277 345,437,500
Awards granted under various incentive plans not yet exercised or

distributed at December 31, 2023(2) 896,632 —
Awards granted under various incentive plans with dilutive effects
at December 31, 2023(3) 3,056,789 11,325,561
(1) As of December 31, 2023 there were 15,782,848 treasury shares held by On (December 31,
2022: 18,021,738).
(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, 2023.
(3) These awards are included in the basic EPS calculation for the twelve-month period ended
December 31, 2023 for Class A ordinary shares and Class B voting rights shares,
respectively, as the impact of the shares are considered dilutive to for the twelve-month
period ending December 31, 2023. However, these awards are excluded from the diluted
EPS calculation for the three-month period ended December 31, 2023 for Class A ordinary
shares and Class B voting rights shares, respectively as the impact of the underlying shares
is considered anti-dilutive for the three-month period ending December 31, 2023.
Share-based compensation
As a public company, we grant share-based compensation awards to our extended founder
team, other members of senior management and to certain other employees to incentivize individuals
based on their impact and contribution to On. As of December 31, 2023, On has recognized an increase
in shareholders' equity in the balance sheet of CHF 27.3 million for share-based compensation incurred
during the twelve-month period ending December 31, 2023.
For the twelve-month period ended December 31, 2023 we have recognized a share-based
compensation charge of CHF 31.8 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 Participation Plan 2018

• 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.
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Indebtedness
On July 7, 2023, we entered into a CHF 700 million multicurrency credit facility agreement 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. As of the date hereof, we have not drawn cash under
this credit facility and we do not currently expect to draw cash from the facility agreement in the near
term. We entered into the facility agreement 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 this new facility agreement 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 new facility agreement has an initial term of
three years and may be extended twice for a period of one year each.
The new multicurrency 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 year ended
December 31, 2023, we were in compliance with all covenants under the new credit facility. As of and
during the year ended December 31, 2022 we were in compliance with all covenants under the previous
bank overdraft facilities.
The following assets have been pledged in relation to the new multicurrency credit facility:
Trade receivables 145.8 43.4 235.8 %

Inventory 285.2 234.9 21.4 %
Assets pledged 431.0 278.3 54.9 %
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Contractual Obligations and Commitments
The following summarizes the significant contractual obligations and commitments as of

December 31, 2023:
Fiscal year ended December 31, 2023
Total Less than 1 1 to 5 More than 5

(CHF in millions) year Years years
Purchase obligations(1) 65.1 65.1 0.0 0.0

(2)
Lease liabilities 263.3 46.9 135.1 81.3
Other financial liabilities 14.8 14.8 0.0 0.0
(3)
Lease commitments 385.7 15.8 145.4 224.5
Total contractual obligations 728.9 142.5 280.5 305.8
(1) Purchase obligations refer to an agreement to purchase goods or services that is

enforceable and legally binding on the registrant that specifies all significant terms. The
figures presented comprise of trade payables as of December 31, 2023.
(2) Lease liabilities are related to storage space, various offices, retail stores, showrooms and
cars.
(3) We have committed ourselves to several new lease contracts, which have not yet
commenced as of December 31, 2023, and are therefore not required to be recognized on
our balance sheet. The majority of the future lease commitments relate to contracts entered
into for new highly-automated warehouses in the United States (Atlanta) and Belgium
(Beringen), respectively. The new warehouse in the United States will partially operate
starting in 2024 and is expected to be fully operational by 2025, and amounts to CHF 245.8
million (December 31, 2022: CHF 254.9 million) lease commitment. The new warehouse in
Belgium will partially operate starting in 2024 and is expected to be fully operational by
2026, and amounts to CHF 122.5 million (December 31, 2022: CHF — million) lease
commitment. The remaining lease commitments relate to new stores in the United States.
Off-Balance Sheet Arrangements
As of December 31, 2023, we provided guarantees and letters of credit in the amount of CHF
155.6 million (December 31, 2022: CHF 126.1 million) in favor of third parties. Thereof, CHF 155.3 million
has been rolled into our new CHF 700 million multicurrency credit facility as discussed in "Indebtedness"
above. Other than those items disclosed here and elsewhere in this document, we do not have any
material off-balance sheet arrangements or commitments as of December 31, 2023.
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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 is fluctuations in foreign currency exchange rates.
The functional currency of our foreign subsidiaries is generally the applicable local currency. Our
consolidated financial statements are presented in CHF. Therefore, the net sales, expenses, assets, and
liabilities of our foreign 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 foreign subsidiaries’ balance sheets into CHF are recorded
as a foreign currency translation adjustment in accumulated other comprehensive income or loss within
shareholders’ equity. The overall translation risk exposure is not deemed material.
We are also exposed to fluctuation in foreign exchange on various transactions. The majority of
our transactional foreign exchange risk arises from products sourced in USD, SG&A in currencies of the
countries in which they are incurred, and sales denominated in the currencies of the respective
destination markets. In 2023, we generated 97% of our net sales in currencies other than CHF and in
2022, we generated 96% of our net sales in currencies other than CHF.
Based on foreign currency sensitivity analysis of the consolidated balance sheets, the financial
result and net income would be impacted as follows by a 10% fluctuation in On's main currencies
(excluding the impact of derivative financial instruments):
December December December
(CHF in millions) 31, 2023 31, 2022 31, 2021
Change in USD/CHF +10% 71.2 32.1 61.1

Change in USD/CHF -10% (71.2) (32.1) (61.1)
Change in EUR/CHF +10% 7.3 1.1 0.4
Change in EUR/CHF -10% (7.3) (1.1) (0.4)
C. Research and Development, Patents and Licenses
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. Our in-house research and development team includes a talented team of sports scientists,
engineers, material experts and designers who work on the innovation, engineering, design, and testing
of our products. We also partner with leading universities and innovative suppliers to co-develop new
technologies and introduce them to market. Product design is supported by a team of well-experienced
people that are primarily based in Zürich, Switzerland, comprised of dedicated athletes and users of our
products who embody our design philosophy and dedication to premium quality. 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. We
incurred research, design, and development expenses of CHF 8.9 million, CHF 8.2 million and CHF 5.3
million for the years ended December 31, 2023, 2022 and 2021, respectively, which are expensed as
incurred and reported in selling, general and administrative expenses in the consolidated statements of
income (loss). Additionally, we capitalize some costs associated with software and intellectual property
customized for internal use within property, plant and equipment and intangible assets on the
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consolidated balance sheets, notably intellectual property intangible assets and in-house developed
software were capitalized of CHF 1.2 million and CHF 0.9 million for the year ended December 31, 2023.
CHF 1.0 million and CHF 3.3 million, and CHF 0.4 million and CHF 1.4 million for the years ended
December 31, 2022 and December 31, 2021, 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 and distribution
networks. Our international expansion has resulted in, and will continue to result in, increased costs and
is subject to a variety of risks, including low initial brand awareness, local competition, inventory risks,
website translation, 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 of the investment to grow net sales is
reflected in our SG&A expenses. SG&A expenses, after removing share based compensation expense,
as a percentage of net sales were 47.7% for 2023 and 46.3% for 2022.
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 10.9% for 2023 and 10.7% for 2022. 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. To support our growth, we also intend to continue investing in our distribution network
as well as into product inventory. For example, during 2023, distribution expenses increased to CHF
239.5 million, compared to CHF 151.0 million in 2022. Additionally, in both 2023 and 2022 we entered
into third party logistics and warehouse services agreements for new, highly-automated fulfillment
centers in and Belgium (Beringen) and Atlanta (USA), respectively, in order to facilitate our future
omnichannel growth in both Europe and North America, and lower our handling cost over time through
automation. 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. Our corporate infrastructure 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. We plan to continue to invest in our corporate back and front-end infrastructure.
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
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maintaining a premium positioning. Historically, inaccurate inventory levels have resulted in missed sales
opportunities, increased distribution expenses due to a higher share of airfreighted products, increased
distribution expenses, and higher discounts towards wholesale partners, as well as in higher or lower
levels of working capital. Significant volatility in global supply chains over the past year have led to
changes in the normal composition and amount of inventory held by On. Our inventory of CHF 356.5
million for the year ended December 31, 2023 was lower than the inventory of CHF 395.6 million for the
year ended December 31, 2022 because of the translation into the reporting currency of foreign
subsidiaries experiencing unfavorable changes in foreign exchange rates. Our current inventory balance
reflects the purchasing of inventory for our 2024 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 and apparel products manufactured in Vietnam, China and most other countries. Although 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 apparel from
China into the United States and the implementation of the Vietnam-European Union Free Trade
Agreement and customs impact from Brexit, we do not foresee any significant change to the customs
and duties rates in the near future.
Seasonality
On operates two product seasons, spring-summer from January to June and fall-winter from
July to December. Each season is characterized by new product launches typically in the first quarters,
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 2023, the second half of our fiscal year represented 52% of our annual net sales, consistent
with 2022, with a large impact due to the peak holiday season in the fourth quarter of 2023, which
typically leads to higher sales in the fourth quarter relative to the rest of the year. We expect a higher
share of net sales from our wholesale channel in the first and third quarters compared to the other two
quarters of the year and net sales from our DTC channel to be higher in the second and fourth quarters
of the year, compared to the first and third quarters.
Foreign exchange
We are also exposed to fluctuation in foreign exchange on various transactions. The majority of
our transactional foreign exchange risk arises from products sourced in U.S. dollars, while selling,
general and administrative expenses are realized in currencies of the countries in which they are incurred
and sales are denominated in the currencies of the respective destination markets. In 2023, we
generated 97% of our net sales in currencies other than CHF, an increase from 2022, when we
generated 96% of our net sales in currencies other than CHF. We have a high degree of visibility into our
net currency exposures. This visibility allows us to enter into derivatives to hedge our foreign currency
exposure. As we continue to grow our business in existing and new geographies, we expect our foreign
exchange exposures to increase. We do not apply hedge accounting and derivative instruments are
recorded as financial assets or liabilities at fair value through profit or loss.
Share-based compensation expenses

As a public company, we granted and we will continue to grant share-based compensation
awards to non-executive members of our board of directors, our extended founder team, other members
of senior management and to certain other employees to incentivize individuals based on their impact
and contribution to On. For the twelve-month periods ended December 31, 2023 and 2022, we
recognized share-based compensation charges of CHF 31.8 million and CHF 33.8 million, respectively,
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primarily in connection with outstanding awards under our LTIP 2021 and LTIP 2020 equity incentive
plans, respectively.
Cost Inflation
We and other companies in our industry are and will continue to be affected by rising inflation
rates across geographies caused by a combination of material shortages, transportation bottlenecks and
rising shipping costs. We continue to work to mitigate the price increases on products with our strong
partner relationships and good visibility of suppliers. 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 external factors such as the COVID-19 pandemic and related labor shortages, which
On seeks to continue to proactively mitigate with long-term partner relationships and the diversification
of vendors across our supply chain.
E. Critical Accounting Estimates
On Holding AG prepares its consolidated financial statements in accordance with IFRS

Accounting Standards, as issued by the IASB. For more information about the critical accounting
estimates and judgements, see Note 1.5 Significant accounting judgments, estimates, and assumptions
of our consolidated financial statements for the fiscal year ended December 31, 2023.
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, 2023 included elsewhere in this Annual Report for more
information on recently adopted accounting pronouncements.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
This section presents information about our executive officers and directors at December 31,
2023. The current business addresses for our directors and executive officers is Förrlibuckstrasse 190,
8005 Zurich, Switzerland.
Name Position Age
David Allemann Co-Founder and Executive Co-Chairman 54

Caspar Coppetti Co-Founder and Executive Co-Chairman 48
Olivier Bernhard Co-Founder and Executive Director 55
Martin Hoffmann Chief Financial Officer and Co-Chief Executive Officer 44
Marc Maurer Co-Chief Executive Officer 42
Alex Perez Director 53
Kenneth A. Fox Director 53
Amy Banse Director 64
Dennis Durkin Director 53
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Biographical information concerning the members of the executive officers and directors
David Allemann is one of our Co-Founders and has served as the Executive Co-Chairman of On
since April 2021. Mr. Allemann was previously leading On as an Executive Co-Founder since January
2010. His special focus has been product creation, setting up production, design, global marketing and
branding as well as the scaling of the DTC business of On. Mr. Allemann brings leadership in
conceptualizing and developing our product, brand and business, and has experience in the marketing
and consulting industries. Prior to joining On, Mr. Allemann served as Chief Marketing Officer for Vitra,
one of the world’s iconic design furniture brands, from 2006 to 2010. Previously, Mr. Allemann served as
the Managing Director of advertising agency Young & Rubicam in Switzerland from 2002 to 2006 and
advised global clients as a strategy consultant at McKinsey & Company in their sports, internet and
media practices from 2000 to 2002. Mr. Allemann holds a Master of Law degree from the University of
Zurich and completed an AMP at INSEAD.
Caspar Coppetti is one of our Co-Founders and has served as the Executive Co-Chairman of
On since April 2021. Mr. Coppetti was previously the Chairman and Global Sales Director of On since
January 2010. Mr. Coppetti brings leadership in conceptualizing and developing our brand and has
business experience as an executive officer in the marketing industry. Prior to joining On, Mr. Coppetti
served as a Managing Partner and Chief Strategy Officer for the brand agency Young & Rubicam from
2004 to 2010. Mr. Coppetti also worked at McKinsey & Company as a Management Consultant from
2001 to 2003. Mr. Coppetti has served on the board of InnHub La Punt AG since 2018. Mr. Coppetti
holds a Dr. Oec. Diploma from the University of St. Gallen.
Olivier Bernhard is one of our Co-Founders and has served as an Executive Board Member of
On since founding the Company in January 2010. Mr. Bernhard brings leadership in conceptualizing and
developing our brand as an athlete as well as his business experience and knowledge of premium
athletic sportswear. Prior to joining On, Mr. Bernhard was a professional Triathlete and Duathlete racing
on world class level. During his professional career from 1993 through 2005 he collected three World
Championship, one European and 15 Swiss Championship titles in various Triathlon and Duathlon
competitions involving different distances.
Martin Hoffmann has served as the Chief Financial Officer and Co-Chief Executive Officer of On
since January 2021. Mr. Hoffmann joined On in July 2013 and has served as the Chief Financial Officer
since joining the Company. Prior to joining On, Mr. Hoffmann served as the Chief Financial Officer of
Valora Retail, a publicly traded European retail company, from November 2009 to June 2013, where he
was responsible for managing the financial operations. Mr. Hoffmann also worked in Business
Management Consulting at CTcon GmbH, from March 2003 to October 2009. Mr. Hoffmann holds a
diploma in Business Management and Computer Science from the University of Kaiserslautern.
Marc Maurer has served as the Co-Chief Executive Officer of On since January 2021. Mr.
Maurer joined On in March 2013 and served as the Chief Operating Officer since joining the Company.
Prior to joining On, Mr. Maurer served as Head of Business Development and Marketing for Valora
Retail, a publicly traded European retail company, from April 2012 to March 2013, where he was
responsible for driving its business development strategy. Mr. Maurer also worked at McKinsey &
Company as an Engagement Manager, from April 2007 to March 2012. Mr. Maurer serves as a Board
Member of the Swiss Entrepreneurs & Startup Association since 2020. Mr. Maurer holds a Master’s in
Business Administration from INSEAD.
Alexandre José da Costa Pérez has served as a member of our board of directors since
December 2016 and member of the audit committee since February 2017. Mr. Pérez has business
experience in the financial industry and with capital management. Mr. Pérez is the founder and
Managing Partner of Point Break Capital Management LLC, which he founded in 2012. Mr. Pérez is also
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a limited partner in Point Break Capital LP and a member and director of Point Break Capital GP Ltd.
Prior to forming Point Break Capital Management, Mr. Pérez was a founding partner of 3G Capital from
2002 to 2011. Prior to forming 3G Capital, Mr. Pérez was the Chief Financial Officer of São Carlos
Empreendimentos, an investment and commercial property management company, from 1999 to 2002.
Before working at São Carlos Empreendimentos, Mr. Pérez was a Private Equity Analyst for GP
Investments, an alternative investment firm, from 1993 to 1999. Mr. Pérez graduated from the University
of Rio de Janeiro, with a B.S. in Economics, and from the Fundação Getúlio Vargas with a Master’s in
Business Administration.
Kenneth A. Fox has served as a member of our board of directors since March 2018. Mr. Fox
brings experience as an investor in the consumer sector. Mr. Fox is the founder of Stripes, LLC, a
growth equity firm that invests in branded consumer and SAAS companies that it believes have amazing
products. Mr. Fox oversees the firm and is also actively involved with many current Stripes’ portfolio
companies. Mr. Fox previously served on the board or was actively involved in many of Stripes realized
portfolio companies including: including Monday.com, Ltd., On Holding AG, Udemy, Inc. Grubhub Inc.
(NASDAQ:GRUB), Blue Apron Holdings, Inc. (NASDAQ:APRN) and Flatiron Health, Inc. (acquired by
Roche). Prior to forming Stripes, Mr. Fox was a Managing Director and one of the founders of Internet
Capital Group, Inc. He was also the founder and Chairman of ICG Asia Ltd., a Hong Kong-listed joint
venture with Hutchison-Whampoa Ltd. that Hutchison later acquired. Mr. Fox holds a B.S. in Economics
from the Pennsylvania State University.
Amy Banse became a member of our board of directors in September 2021, upon the listing of
our Class A ordinary shares on the NYSE. Ms. Banse brings leadership and experience in starting,
investing in and building businesses and has held several executive leadership roles in doing so. Ms.
Banse served as senior adviser to the executive committee of Comcast Corporation, a global media and
technology company (including Comcast Ventures, LLC, its venture capital arm), from September 2020
to December 2021. She previously was an Executive Vice President at Comcast Corporation, and
Managing Director and head of funds at Comcast Ventures LLC from January 2011 to September 2020.
From 2005 to 2011, Ms. Banse was Senior Vice President at Comcast Corporation and President at
Comcast Interactive Media, a division of Comcast responsible for developing online strategy and
operating its digital properties. Ms. Banse joined Comcast in 1991 and early on held various positions,
including content development, programming investments and overseeing the development and
acquisition of Comcast’s cable network portfolio. Ms. Banse also serves as a director of Adobe Inc, The
Clorox Company and Lennar Corporation. She holds a B.A. from Harvard University and a doctor of law
degree from Temple University Law School.
Dennis Durkin became a member of our board of directors and chairman of the audit
committee in May 2022, and previously served as a board observer from September 2021 through May
2022. Prior to that, he had served as the Chief Financial Officer of Activision Blizzard Inc (ATVI) before
retiring in May 2021. He originally joined ATVI as CFO in March 2012 and held that position until May
2017. He served as Chief Corporate Officer from May 2017 until January 2019. From January 2019 until
his retirement, he served as Chief Financial Officer and President of Emerging Businesses. Prior to
joining ATVI, from 1999 until February 2012, Mr. Durkin held a number of positions of increasing
responsibility at Microsoft Corporation, most recently serving as the Corporate Vice President, and Chief
Operating and Financial Officer, of Microsoft’s Interactive Entertainment Business, which included the
Xbox, Xbox Live and games business. Prior to joining Microsoft’s Interactive Entertainment Business in
2006, Mr. Durkin worked on Microsoft’s corporate development and strategy team, including two years
where he was based in London, England driving pan-European activity. Before joining Microsoft, Mr.
Durkin was a financial analyst at Alex. Brown and Company. Mr. Durkin holds a B.A. degree in
government from Dartmouth College and an M.B.A. degree from Harvard University.
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B. Compensation
Principles of the Compensation of the Board of Directors and Executive Management

For the year ended December 31, 2023, the aggregate compensation accrued or paid to the
members of our board of directors for services in all capacities to the Company and its subsidiaries was
CHF 1.1 million.
For the year ended December 31, 2023, the aggregate compensation accrued or paid to our
executive officers for services in all capacities to the Company and its subsidiaries was CHF 18.3 million,
including CHF 13.8 million in share-based compensation and CHF 4.2 million in short-term employee
benefits including base salary, annual cash bonus as well as health care plans, insurance, car
allowances or equivalent contributions.
The amount set aside or accrued by us to provide pension, retirement or similar benefits to our
executive officers amounted to a total of CHF 0.3 million in the year ended December 31, 2023.
We incorporate by reference into this Annual Report the information included in the sections
labeled “Board of Directors Compensation” and “Executive Board Compensation” of Exhibit 99.2 to our
report on Form 6-K filed with the SEC on March 12, 2024, which includes disclosure of compensation on
an individual basis as well as information on the applicable equity incentive and cash bonus plans
underlying the compensation accrued or paid to our executive officers.
Pursuant to Swiss law, we are required to submit the aggregate amount of compensation of our
board of directors and the aggregate amount of compensation of our executive officers to a binding say-
on-pay vote by our shareholders.
C. Board Practices
Board of Directors
Our board of directors is composed of seven members. Each director is elected for a term
ending at the next annual general meeting of shareholders. The current term of all of our directors will
end at our next annual general meeting of shareholders in May 2024, at which time reelection will be
possible. There are no family relationships among any of our directors or executive officers.
We are a foreign private issuer under the rules of the SEC and in accordance with the NYSE
listing standards, we rely on home country governance requirements and certain exemptions thereunder
rather than on the stock exchange corporate governance requirements. For an overview of our corporate
governance principles, see “Item 10. Additional Information - Memorandum and Articles of Association.”
Committees
Audit Committee
The audit committee currently consists of Dennis Durkin (chairman of the audit committee) and
Alex Perez. The primary functions of the audit committee include overseeing our accounting and
financial reporting processes, system of internal controls over financial reporting, risk management
processes and the audits of our financial statements. In addition, the audit committee is also directly
responsible for the selection and nomination of our independent registered public accounting firm for
election by the general meeting of shareholders, as well as the supervision and compensation and
oversight of the work of our external auditors, including evaluation regarding external auditors' fulfillment
of the necessary qualifications and independence. The audit committee is also responsible for reviewing,
approving or ratifying any related party transactions. The board of directors has determined that each of
Dennis Durkin and Alex Perez is considered an “audit committee financial expert,” as such term is
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defined in the rules of the SEC. Our board of directors has also determined that each of Alex Perez and
Dennis Durkin satisfies the "independence" requirements set forth in Rule 10A-3 of the Exchange Act
and NYSE listing standards.
Nomination and Compensation Committee

The nomination and compensation committee, which consists of Amy Banse, Kenneth Fox and
Alex Perez, supports our board of directors by preparing and periodically reviewing our compensation
policies and principles and the performance criteria related to compensation, as well as periodically
reviewing their implementation. The nomination and compensation committee also submits proposals
and recommendations to our board of directors regarding the individual compensation of members of
our board of directors and our executive officers, and prepares proposals to the annual general meeting
of shareholders regarding the aggregate compensation of the members of the board of directors and our
executive officers. The nomination and compensation committee may submit proposals to the board of
directors on other compensation-related matters as well. Swiss law requires that we have a
compensation committee, so in accordance with the NYSE listing standards, we follow home country
requirements with respect to the compensation committee. As a result, our practice varies from the
NYSE listing standards, which set forth certain requirements as to the responsibilities, composition and
independence of compensation committees for domestic issuers. Swiss law requires that our board of
directors submit the aggregate amount of compensation of all members of our board of directors and of
all executive officers to a binding shareholder vote every year. The members of the nomination and
compensation committee were elected at our last AGM held on May 25, 2023 for a term until the next
annual general meeting of shareholders, and the members of the nomination and compensation
committee will be elected annually by our annual general meeting of shareholders. The board of
directors appoints the chair of the nomination and compensation committee and fills any vacancies until
the following annual general meeting of shareholders.
D. Employees
Our strongest asset is our team. We have been able to attract, retain and motivate individuals
with a diverse background and skills that together build high performing teams. Our exceptional human
capital is carefully assessed through a robust interview process and developed throughout their journey
at On. We endeavor to incentivize individuals based on their impact and contribution to On through
equity compensation and other incentives.
Our core spirits call on each of our employees to care for each other and our customers. We
believe that creative solutions are best achieved by diverse teams working together. Diversity of
thoughts, backgrounds, perceptions and ideas helps us create the technologies and innovations and
helps our business thrive.
We partner with suppliers who share our commitment to ethical business conduct, fair labor
practices, proven environmental, health, and safety practices and environmental sustainability. We also
specifically condemn human trafficking and abuse of child labor. We recognize the importance of
eliminating forced labor within the supply chain and its increasing significance. Our supplier code of
conduct prohibits the use of forced labor, and we will not knowingly conduct business with vendors or
factories that use forced labor. We expect all of our vendors and suppliers to conduct sufficient due
diligence in their supply chains to ensure compliance with our vendor code of conduct, and we continue
to expand our due diligence activities and vendor engagement and training on this important issue.
Moreover, we seek to work with third-party suppliers and factories that are committed to providing fair
and safe working conditions, and that demonstrate strong business ethics and transparency in their
manufacturing practices. We are subject to, and comply with, local labor law requirements in all
countries in which we operate. We consider our employee relations to be good and we have not
experienced any work stoppages.
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The number of employees by geographic location as of the end of the period for our fiscal years
ended December 31, 2023, 2022 and 2021 was as follows:
Year ended December 31,
(1)
in FTE 2023 2022(2) 2021(2)
On studio and lab (Headquarters) 856 669 474

Europe, Middle East and Africa 511 318 202
Americas 483 380 279
Asia-Pacific 503 334 202
Total employees (full-time equivalents) 2,353 1,701 1,158
thereof females 50.6 % 48.8 % 47.8 %
thereof males 48.9 % 50.7 % 51.7 %
thereof others 0.5 % 0.5 % 0.5
Number of nationalities 94 79 65
Average age 33 34 33
(1)
Total number of FTEs, including retail employees.
(2)
As announced on Form 6-K filed with the U.S. Securities and Exchange Commission on May 2, 2023,
effective in the first quarter of 2023, the Company updated its reporting of geographic regions,
Specifically, “Rest of World”, which represented Middle East, Africa and Latin America, is no longer
being reported as a geographic location. Instead, Middle East and Africa is now combined with Europe
and called Europe, Middle East & Africa (“EMEA”), and Latin America is now part of the new geographic
location called Americas (replacing North America as a geographic location).
The new reporting of FTE's by geography has no impact on previously reported FTE's. The new
reporting of FTE's by geography includes a reallocation of 14 and 12 FTE's from Rest of World to
Americas, for the year ended December 31, 2022 and December 31, 2021, respectively.
E. Share Ownership
The information set forth under "Item 6. Directors, Senior Management and Employees -
Compensation” and "Item 7. Major Shareholders and Related Party Transactions” is incorporated by
reference.
F. Disclosure of a Registrant's Action to Recover Erroneously Awarded Compensation
Not applicable.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A. Major Shareholders
Security Ownership
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The following table presents information relating to the beneficial ownership of our Class A
ordinary shares and Class B voting rights shares as of December 31, 2023:
• each person, or group of affiliated persons, known by us to own beneficially 5% or more of

our outstanding Class A ordinary shares or Class B voting rights shares;
• each of our executive officers and directors; and
• all executive officers and directors as a group.
Beneficial ownership is determined in accordance with SEC rules. The information is not
necessarily indicative of beneficial ownership for any other purpose. In general, under these rules a
beneficial owner of a security includes any person who, directly or indirectly, through any contract,
arrangement, understanding, relationship or otherwise has or shares voting power or investment power
with respect to such security. A person is also deemed to be a beneficial owner of a security if that
person has the right to acquire beneficial ownership of such security within 60 days. Except as otherwise
indicated, and subject to applicable community property laws, the persons named in the table have sole
voting and investment power with respect to all shares held by that person.
The percentage of outstanding Class A ordinary shares and Class B voting rights shares
beneficially owned is computed based on 284,215,277 Class A ordinary shares and 345,437,500 Class B
voting rights shares outstanding as of December 31, 2023. Class A ordinary shares or Class B voting
rights shares that a person has the right to acquire within 60 days of December 31, 2023 are deemed
outstanding for purposes of computing the percentage ownership of the person holding such rights, but
are not deemed outstanding for purposes of computing the percentage ownership of any other person,
except with respect to the percentage ownership of all executive officers and directors as a group.
Consequently, the denominator used for calculating such percentage may be different for each
beneficial owner. The numbers and percentages below will not foot due to the unique calculus required
by Rule 13d-3 of the Securities Exchange Act of 1934, as amended. Unless otherwise indicated below,
the business address for each beneficial owner is On Holding AG, Förrlibuckstrasse 190, 8005 Zurich,
Switzerland.
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Class B
Class A Voting % of Total % of Total
Ordinary Rights Voting Economic
Shareholders Shares % Shares % Power Ownership
Executives:
Olivier Bernhard 6,958,762 2.4 % 113,725,000 32.6 % 19.1 % 5.7 %
Caspar Coppetti 5,216,912 1.8 % 107,475,000 30.8 % 17.8 % 5.0 %
David Allemann 4,950,089 1.7 % 101,225,000 29.0 % 16.8 % 4.7 %
Martin Hoffmann 2,549,195 0.9 % 19,412,500 5.6 % 3.5 % 1.4 %
Marc Maurer 2,337,502 0.8 % 19,412,500 5.6 % 3.4 % 1.3 %
5% or Greater
Shareholders:
FMR LLC(1) 28,358,626 10.0 % — —% 4.5 % 8.9 %
Carlos Alberto da
Veiga Sicupira(2) 19,833,971 7.0 % — —% 3.1 % 6.2 %
Marc Lemann(3) 18,002,457 6.3 % — —% 2.9 % 5.6 %
Morgan Stanley(4) 16,089,024 5.7 % — —% 2.6 % 5.0 %

Other Directors:
Alex Pérez(5) 11,382,016 4.0 % — —% 1.8 % 3.6 %
Kenneth A. Fox(6) 3,712,149 1.3 % — —% 0.6 % 1.2 %
Dennis Durkin 82,483 —% — —% —% —%
Amy Banse 58,575 —% — —% —% —%
All directors and 37,247,683 13.0 % 361,250,000 100.0 % 61.6 % 22.8 %
executive officers as
a group (nine
persons)
(1) As of December 31, 2023, FMR LLC had sole voting and dispositive power over 28,358,626
Class A ordinary shares. Abigail P. Johnson is a Director, the Chairman and the Chief
Executive Officer of FMR LLC. Members of the Johnson family, including Abigail P. Johnson,
control, directly or through trusts, approximately 49% of the voting power of FMR LLC. The
address of FMR LLC is 245 Summer Street, Boston, Massachusetts 02210. This information
is based on a Schedule 13G/A filed with the SEC on February 9, 2024.
(2) Consists of (i) 19,712,048 Class A ordinary shares held by CHL Investment Fund Ltd.
("CHL") and (ii) 121,923 Class A ordinary shares beneficially owned by Mr. Sicupira's
spouse, of which Mr. Sicupira may be deemed to share beneficial ownership. CHL is an
investment fund, whose majority shares are beneficially owned by Mr. Sicupira. The address
for Carlos Alberto da Veiga Sicupira is Rua Dr. Renato Paes de Barros, 1017, 15th floor, Sao
Paulo, Brazil. The address for CHL is Goodman's Bay Corporate Centre, 2nd Floor, 309
West Bay Street, PO Box SP61567, Nassau, Bahamas. This information is based on a
Schedule 13G filed with the SEC on January 13, 2022.
(3) Consists of 18,002,457 Class A ordinary shares held by MAAI Ltd. ("MAAI"). MAAI is a
company controlled by Marc Lemann. The address for Marc Lemann is Rua Dr. Renato Paes
de Barros, 1017, 15th floor, Sao Paulo, Brazil. The address for MAAI is C/
O BVC Services Ltd., Bahamas Financial Centre, 2nd Floor, Shirley & Charlotte Streets,
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PO Box N-1175, Nassau, Bahamas. This information is based on a Schedule 13G filed with
the SEC on December 30, 2021.
(4) As of December 31, 2023, (i) Morgan Stanley had shared voting power over 15,250,008
Class A ordinary shares and shared dispositive power over 16,089,024 Class A ordinary
shares and (ii) Morgan Stanley Investment Management Inc. had shared voting power over
15,205,312 Class A ordinary shares and shared dispositive power over 16,044,328 Class A
ordinary shares. The securities reported on by Morgan Stanley as a parent holding company
are owned, or may be deemed to be beneficially owned, by Morgan Stanley Investment
Management Inc., a wholly-owned subsidiary of Morgan Stanley. The address of Morgan
Stanley and Morgan Stanley Investment Management Inc. is 1585 Broadway, New York,
New York 10036. This information is based on a Schedule 13G filed with the SEC on
February 9, 2024.
(5) Consists of (i) 11,338,036 Class A ordinary shares held by Mr. Pérez in his individual
capacity and (ii) 43,980 Class A ordinary shares held by Point Break Capital GP Ltd ("PBC
GP Ltd"). Mr. Pérez is a member and director of PBC GP Ltd, holding joint discretion over
the assets of that entity. None of PBC GP Ltd’s directors (including Mr. Pérez) have authority
to act singly to represent PBC GP Ltd or to manage its investment in On. The address for
Mr. Pérez and PBC GP Ltd is c/o Point Break Capital Management LLC, 3550 Biscayne
Blvd., Suite 600, Miami, FL 33137.
(6) Consists of (i) 3,113,828 Class A ordinary shares held by Mr. Fox in his individual capacity,
(ii) 344,266 Class A ordinary shares held by Stripes GP III, LLC (Stripes GP III) and (iii)
254,055 Class A ordinary shares held by Stripes GP IV, LLC (“Stripes GP IV”). Mr. Fox is the
managing member of Stripes Holdings, LLC (“Stripes Holdings”), which controls Stripes GP
III and Stripes GP IV, and may be deemed to have sole voting and dispositive control over
certain of the shares held by Stripes GP III and Stripes GP IV. The address of Mr. Fox,
Stripes GP III and Stripes GP IV is c/o Stripes, LLC, 40 10th Avenue, New York, NY 10014.
This information is based on a Schedule 13G/A filed with the SEC on February 12, 2024.
Significant Changes in Ownership

According to a Schedule 13G/A filed with the SEC on February 12, 2024, Stripes III, LP, Stripes
IV, LP and Stripes Secondary Holdings I, LP no longer beneficially own more than 5% of our Class A
ordinary shares.
According to a Schedule 13G/A filed with the SEC on February 14, 2023, HHLR Advisors Ltd.
and Hillhouse Investment Management Ltd. no longer beneficially own more than 5% of our Class A
ordinary shares. To our knowledge, and based on Section 13 filings with the SEC, other than as
disclosed in the table above, our other filings with the SEC and this Annual Report, there have been no
other significant changes in the percentage ownership held by any major shareholder during the past
three years.
Holders
As of December 31, 2023, we had 10 shareholders of record. We estimate that as of
December 31, 2023, approximately 93% of our outstanding Class A ordinary shares are held by 4 U.S.
record holders. This estimation takes into account that any Class A ordinary shares held by the
executive officers shown in the table above are not held by a U.S. holder. Since some of the shares are
held by nominees, the number of shareholders may further not be representative of the number of
beneficial owners.
B. Related Party Transactions
The following is a description of certain related party transactions we have entered into since
January 1, 2021 with any of our executive officers, directors or their affiliates and holders of more than
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5% of any class of our voting securities in the aggregate, which we refer to as related parties, other than
compensation arrangements which are described under "Item 6. Directors and Senior Management.”
Related Person Transaction Policy

Our related person transaction policy states that any related person transaction must be
reviewed and approved or ratified by our audit committee or board of directors. In determining whether
to approve or ratify a transaction with a related person, our audit committee or board of directors will
consider all relevant facts and circumstances, including, without limitation, the commercial
reasonableness of the terms of the transaction, the benefit and perceived benefit, or lack thereof, to us,
the opportunity costs of an alternative transaction, the materiality and character of the related person’s
direct or indirect interest and the actual or apparent conflict of interest of the related person. Our audit
committee or board of directors will not approve or ratify a related person transaction unless it has
determined that, upon consideration of all relevant information, such transaction is in, or not inconsistent
with, our best interests and the best interests of our shareholders.
Upon the effective date of the Swiss corporate law reform (see “Item 3 – Key Information – D.
Risk Factors, - VI. Risk associated with securities market and ownership of our Class A ordinary shares –
(iv) Swiss corporate law”), the members of the board of directors and the executive committee will be
required to immediately and fully inform the board of directors about conflicts of interests concerning
them. The board of directors will furthermore be required to take measures in order to protect our
interests.
Employment Agreements
In connection with the completion of our public offering in 2021, we entered into employment
agreements with certain of our executive officers. Each of these agreements provide for a base salary
and annual performance cash bonus opportunity (with target and maximum bonus opportunities), as well
as participation in certain pension and long term equity incentive plans and certain other benefits. These
agreements generally require 12 months advance notice of termination. The employment agreements
also provide for covenants not to compete against us or solicit our employees or customers during
employment and for a period of up to one year following termination of employment. We will be required
to pay our executive officers compensation for their covenant not to compete with us following
termination of employment.
Indemnification Agreements
We have entered into indemnification agreements with our executive officers and directors. The
indemnification agreements and our amended and restated articles of association require us to
indemnify our executive officers and directors to the fullest extent permitted by law.
Shareholders’ Agreement
We have entered into a shareholders’ agreement with our extended founder team in connection
with our IPO in 2021. Pursuant to the terms of the shareholders’ agreement, the members of our
extended founder team have agreed to vote together on those matters that will be put for a vote in our
shareholders’ meetings. In particular, if with regard to a specific matter at least 50% or more of the
extended founder team and the simple majority of the voting rights of the extended founder team
represented at the meeting of the extended founder team resolve to vote in a specific manner, each
member of the extended founder team would be required to vote at the shareholders’ meeting on such
matter accordingly. If at the meeting of the extended founder team no such quorum is reached, the
extended founder team would be required to vote (i) for the motions of the board of directors of the
Company at the shareholders’ meeting as set forth in the invitation to such meeting, or (ii) if a motion is
requested by a shareholder, according to the recommendations of the board of directors (except for
elections to the board of directors, as to which the extended founder team may vote individually).
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Moreover, pursuant to the terms of the shareholders’ agreement, the members of the extended
founder team are required to vote for a conversion of all Class B voting rights shares into Class A
ordinary shares no sooner than 13 months and no later than 24 months following the occurrence of any
of the following events, which we refer to as the “general sunset events”:
• the extended founder team ceases to hold at least 65% of the aggregate number of Class B
voting rights shares held by them immediately following our IPO; or
• fewer than two of the initial holders of Class B voting rights shares continue to hold Class B
voting rights shares.
In addition to the general sunset events, the shareholders’ agreement includes additional
restrictions that apply individually to each member of the extended founder team. In particular, the
shareholders’ agreement also provides for “individual sunset events,” which include the following
events:
• an individual member of the extended founder team ceases to hold at least 65% of the number
of Class B voting rights shares held by such individual immediately following our IPO;
• a member of the extended founder team is subject to a final non-appealable conviction for fraud,
theft, misappropriation and/or criminal mismanagement against the Company and/or its
controlled affiliates; and
• a member of the extended founder team dies or is incapacitated in a manner that causes such
member to permanently, but not temporarily, be unable to exercise such member’s function as
an executive or board member.
In each case, such member (or such member’s heirs) would be required to offer his Class B
voting rights shares for sale to the other members of the extended founder team, or request conversion
of the Class B voting rights shares into Class A ordinary shares no sooner than 13 months and no later
than 24 months following the occurrence of such individual sunset event.
The shareholders’ agreement provides that as long as a co-founder continues to hold at least
65% of the number of Class B voting rights shares held immediately following our IPO, such co-founder
shall be entitled to a seat on the board of directors of the Company and that the members of the
extended founder team undertake to vote for such co-founder’s election or re-election (as applicable) to
the board of directors of the Company, subject to limited exceptions, including in the case of certain
criminal convictions.
In addition, the shareholders’ agreement also provides members of our extended founder team
with a right of first refusal to purchase shares of Class B voting rights shares that are intended to be sold
or transferred by other members of our extended founder team, subject to certain exceptions.
Conversion of Class B voting rights shares into Class A ordinary shares requires approval at a
general meeting of shareholders. If such conversion is approved, ten (10) Class B voting rights shares
will be converted into one (1) Class A ordinary shares. The conversion ratio is strictly based on the
different par value of the shares and there will be no separate consideration for the increased voting right
power of the Class B voting rights shares. If the conversion is not approved at the general meeting of
shareholders, the holder of the Class B voting rights shares may sell such shares to any third party
(subject to compliance with applicable law).
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Other Related Party Transactions

For additional information on related party transactions, see Note 6.5 Related parties in the
Company’s annual consolidated financial statements contained in this Annual Report on Form 20-F.
C. Interests of Experts and Counsel
Not applicable.
ITEM 8. FINANCIAL INFORMATION
A. Consolidated Statements and Other Financial Information

See "Item 18. Financial Statements".
Legal Proceedings
From time to time, we may be subject to legal proceedings and claims in the ordinary course of
business, The results of litigation and claims cannot be predicted with certainty. As of the date of this
Annual Report, we do not believe that we are party to any claim or litigation, the outcome of which
would, individually or in the aggregate, be reasonably expected to have a material adverse effect on our
business.
Dividends and Dividend Policy

We have never declared or paid cash dividends on our share capital. We currently intend to
retain all available funds and future earnings, if any, to fund the development and expansion of our
business and we do not anticipate paying any cash dividends in the foreseeable future. Any future
proposals at our shareholders’ meeting regarding the declaration and payment of dividends will be at the
discretion of our board of directors and will depend on then-existing conditions, including our financial
condition, results of operation, contractual restrictions, capital requirements, business prospects and
other factors our board of directors may deem relevant. Under Swiss law, any dividend must be
approved by our shareholders.
B. Significant Changes
No significant changes, other than as otherwise described in this Annual Report, have occurred in our
operations since the date of our financial statements included in this Annual Report.
ITEM 9. THE OFFER AND LISTING
A. Offer and Listing Details

On Holding AG’s Class A ordinary shares have been listed on the NYSE under the symbol “ONON” since
September 15, 2021. Prior to that date, there was no public trading market for our Class A ordinary
shares.
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B. Plan of Distribution
Not applicable.
C. Markets
See “—Item 9.A Offer and Listing Details” above.
D. Selling Shareholders
Not applicable.
E. Dilution
Not applicable.
F. Expenses of the Issue

Not applicable.
ITEM 10. ADDITIONAL INFORMATION
A. Share Capital
We have a share capital of CHF 33.5 million, divided in 299,998,125 authorized Class A ordinary shares,
CHF 0.10 par value, of which 284,215,277 are outstanding, and 345,437,500 authorized and outstanding
Class B voting rights shares, CHF 0.01 par value. The Company is registered in the commercial register
of the canton of Zurich.
B. Memorandum and Articles of Association

When we refer to our articles of association in this Form 20-F, we refer to our amended and
restated articles of association dated as of May 25, 2023.
Stated objects or purposes

We are incorporated as a corporation (Aktiengesellschaft) under the laws of Switzerland and our
affairs are governed by the provisions of our articles of association, as amended and restated from time
to time, our organizational regulations and by the provisions of applicable Swiss law.
As provided in our articles of association, subject to Swiss law, we have full capacity to carry on
or undertake any business or activity, do any act or enter into any transaction, and, for such purposes,
have full rights, powers and privileges. Our registered office is Förrlibuckstrasse 190, 8005 Zurich,
Switzerland.
Directors
The members of the board of directors and the co-chairmen are elected annually by the general
meeting of shareholders for a period until the completion of the subsequent annual general meeting of
shareholders and are eligible for re-election. Each member of the board of directors must be elected
individually.
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Powers
The board of directors has the following non-delegable and inalienable powers and duties:
• to ultimately manage the Company and issue the necessary directives;
• to determine the Company's organization;
• to structure the accounting systems, the reporting systems, financial controls as well
as the financial planning of the Company;
• to appoint and remove the persons entrusted with the management and representation
of the Company;
• to exercise the ultimate supervision over the persons entrusted with the management, in
particular with respect to compliance with the law and with the articles of association,
organizational regulations or any directives, policies or guidelines;
• to prepare the annual report (including, to the extent required, the management report,
the consolidated financial statements, the annual statements, and the compensation
report), and receive the report of the statutory auditors as well as of the reports of
the board committees;
• to prepare the general meetings of shareholders, and to implement the general meetings'
resolutions;
• to file a moratorium request and notify the court in case of insolvency or over-indebtedness;
• to pass resolutions regarding the subsequent payment of capital with respect to non-fully
paid-up shares;
• to pass resolutions confirming increases in share capital or changes of the currency of the
share capital and amending the articles of association in that respect;
• to resolve on any other matter which is subject to board resolution pursuant to the articles
of association or mandatory law.
The board of directors may, while retaining such non-delegable and inalienable powers and
duties, delegate some of its powers, in particular the direct management, to a single or to several of its
members, committees or to third parties (such as executive officers) who need be neither members of
the board of directors nor shareholders. Pursuant to Swiss law and our articles of association, details of
the delegation and other procedural rules such as quorum requirements have been set in the
organizational regulations established by the board of directors.
Shareholder rights
Pursuant to Swiss law and our articles of association, one or more shareholders whose
combined shareholdings represent 0.5% of the voting rights or of our share capital may request that an
item be included in the agenda for a general meeting of shareholders. To be timely, the shareholder’s
request must be in writing and must be received by us at least 60 calendar days in advance of the
meeting.
Our annual report, the compensation report and the auditors' report must be made available
electronically for inspection by the shareholders no later than 20 days prior to the general meeting of
shareholders. If such documents are not available electronically, a shareholder may request that a copy
is sent to it.
Dividend Rights
Our board of directors may propose to shareholders that a dividend or other distribution be paid,
but cannot itself authorize distributions. Dividend payments require a resolution passed by an absolute
majority of the voting rights represented at a general meeting of shareholders. In addition, our auditors
must confirm that the dividend proposal of our board of directors conforms to Swiss statutory law and
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our articles of association. Dividends that have not been collected within five years after their payment
date shall inure to the Company.
Voting Rights
Each of our shares entitles a holder to one vote in the general meeting of the shareholders,
irrespective of the par value of such shares. Our shares are not divisible. The right to vote and the other
rights of share ownership may only be exercised by shareholders (including any nominees) or
usufructuaries who are entered in the share register prior to the applicable cut-off date to be determined
by the board of directors. Those entitled to vote in the general meeting of shareholders may be
represented by the independent proxy representative (annually elected by the general meeting of
shareholders), by its legal representative or by a third party, who does not need to be a shareholder, with
due authorization to act as proxy. The chairman of the general meeting of the shareholders has the
power to decide whether to recognize a power of attorney.
Transfer of Shares
Shares in uncertificated form (Wertrechte) may only be transferred by way of written assignment.
Shares or the beneficial interest in shares, as applicable, credited in a securities account may only be
transferred when a credit of the relevant intermediated securities to the acquirer’s securities account is
made in accordance with applicable rules.
Voting rights may be exercised only after a shareholder (including nominee) or usufructuary has
been entered in the share register with its name and address (in the case of legal entities, the registered
office) as a shareholder with voting rights. For a discussion of the restrictions applicable to the control
and exercise of voting rights, see “—Articles of Association—Voting Rights.”
Inspection of Books and Records

Under the Swiss Code of Obligations (the "CO"), a shareholder has a right to inspect the share
register with respect to its own shares and otherwise to the extent necessary to exercise its shareholder
rights. No other person has a right to inspect the share register. Our books and correspondence may be
inspected with the express authorization of the general meeting of shareholders or by resolution of the
board of directors and subject to the safeguarding of our business secrets and other legitimate interests.
Special Investigation
If the shareholders’ inspection rights as outlined above prove to be insufficient in the judgment
of the shareholder, any shareholder who has already exercised its inspection rights may propose to the
general meeting of shareholders that specific facts be examined by a special examiner in a special
investigation. If the general meeting of shareholders approves the proposal, we or any shareholder may,
within 30 calendar days after the general meeting of shareholders, request a court at our registered
office (currently Zurich, Canton of Zurich, Switzerland) to appoint a special examiner. If the general
meeting of shareholders rejects the request, one or more shareholders representing at least 5 % of our
share capital or the voting rights may request that the court appoint a special examiner. The court will
issue such an order if the petitioners can demonstrate that the board of directors, any member of the
board of directors or our executive committee infringed the law or our articles of association and thereby
caused damages to the Company or the shareholders.
The costs of the investigation would generally be allocated to us and only in exceptional cases
to the petitioners.
Shareholders’ Rights to Bring Actions for the Benefit of the Company

According to the CO, an individual shareholder may bring an action, in its own name and for the
benefit of the Company, against the Company’s directors, officers or liquidators for the recovery of any
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losses we have suffered as a result of the intentional or negligent breach by such directors, officers or
liquidators of their duties.
Compulsory Acquisitions; Appraisal Rights

Business combinations and other transactions that are governed by the Swiss Merger Act (i.e.,
mergers, demergers, transformations and certain asset transfers) are binding on all shareholders. A
statutory merger or demerger requires approval of two-thirds of the shares represented at a general
meeting of shareholders and the absolute majority of the par value of the shares represented.
If a transaction under the Swiss Merger Act receives all of the necessary consents, all
shareholders are compelled to participate in such a transaction.
Swiss corporations may be acquired by an acquirer through the direct acquisition of the shares
of the Swiss corporation. The Swiss Merger Act provides for the possibility of a so-called “cash-out” or
“squeeze-out” merger with the approval of holders of 90% of the issued shares. In these limited
circumstances, minority shareholders of the corporation being acquired may be compensated in a form
other than through shares of the acquiring corporation (for instance, through cash or securities of a
parent corporation of the acquiring corporation or of another corporation). For business combinations
effected in the form of a statutory merger or demerger and subject to Swiss law, the Swiss Merger Act
provides that if equity rights have not been adequately preserved or compensation payments in the
transaction are unreasonable, a shareholder may request a competent court to determine a reasonable
amount of compensation.
In addition, under Swiss law, the sale of “all or substantially all of our assets” by us may require
the approval of two-thirds of the voting rights represented at a general meeting of shareholders and the
absolute majority of the par value of the shares represented. Whether a shareholder resolution is
required depends on the particular transaction, including whether the following test is satisfied:
• a core part of our business is sold without which it is economically impracticable or
unreasonable to continue to operate the remaining business;
• our assets, after the divestment, are not invested in accordance with our corporate purpose
as set forth in the articles of association; and
• the proceeds of the divestment are not earmarked for reinvestment in accordance with our
corporate purpose but, instead, are intended for distribution to our shareholders or for
financial investments unrelated to our corporate purpose.
A shareholder of a Swiss corporation participating in certain major corporate transactions may,
under certain circumstances, be entitled to appraisal rights. As a result, such shareholder may, in
addition to the consideration (be it in shares or in cash) receive an additional amount to ensure that the
shareholder receives the fair value of the shares held by the shareholder. Following a statutory merger or
demerger, pursuant to the Swiss Merger Act, shareholders can file an appraisal action against the
surviving company. The action must be filed within two months after the merger or demerger resolution
has been published in the Swiss Official Gazette of Commerce. The filing of the action will not prevent
completion of the merger or demerger. If the consideration is deemed inadequate, the court will
determine an adequate compensation payment.
Changes to shareholder rights
Ordinary Capital Increase, Conditional Share Capital and Capital Band

Under Swiss law, we may increase our share capital (Aktienkapital) with a resolution of the
general meeting of shareholders (ordinary capital increase) that must be carried out by the board of
directors within six months of the respective general meeting in order to become effective. Under our
articles of association and Swiss law, in the case of subscription and increase against payment of
contributions in cash, a resolution passed by an absolute majority of the voting rights represented at the
general meeting of shareholders is required. In the case of subscription and increase against
contributions in kind or by way of set-off with a debt of the Company, when shareholders’ statutory pre-
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emptive subscription rights or advance subscription rights are limited or withdrawn, or where
transformation of freely disposable equity into share capital is involved, a resolution passed by two-
thirds of the voting rights represented at a general meeting of shareholders and the absolute majority of
the par value of the shares represented is required.
Furthermore, under the CO, our shareholders, by a resolution passed by two-thirds of the voting
rights represented at a general meeting of shareholders and the absolute majority of the par value of the
shares represented, may:
• authorize our board of directors to issue shares of a specific aggregate par value up to a
maximum of 50% of the existing share capital registered in the Commercial Register in the
form of conditional share capital (bedingtes Aktienkapital) for the purpose of issuing shares
in connection with, among other things, (i) option and conversion rights granted in
connection with warrants and convertible bonds of the Company or one of our subsidiaries
or (ii) grants of rights to employees, members of our board of directors or consultants or to
our subsidiaries or other persons providing services to the Company or a subsidiary to
subscribe for new shares (conversion or option rights); and/or
• create a capital band (Kapitalband) authorizing our board of directors at any time within 5
(five) years to increase or decrease the share capital of the Company by a maximum
amount of 50% of the existing the share capital registered in the Commercial Register. As
of January 1, 2023 the capital band has replaced the authorized share capital (genehmigtes
Aktienkapital), which has been abolished. Existing authorized share capital may remain in
place until it expires but it may no longer be renewed and no new authorized share capital
may be created.
Pre-Emptive and Advance Subscription Rights

Pursuant to the CO, shareholders have pre-emptive subscription rights (Bezugsrechte) to
subscribe for new issuances of shares. With respect to conditional capital in connection with the
issuance of conversion rights, convertible bonds or similar debt instruments, shareholders have advance
subscription rights (Vorwegzeichnungsrechte) for the subscription of such conversion rights, convertible
bonds or similar debt instruments.
A resolution passed at a general meeting of shareholders by two-thirds of the voting rights
represented and the absolute majority of the par value of the shares represented may authorize our
board of directors to withdraw or limit pre-emptive subscription rights and/or advance subscription
rights in certain circumstances.
If pre-emptive subscription rights are granted, but not exercised, the board of directors may
allocate the unexercised pre-emptive subscription rights at its discretion.
Shareholder meetings
The general meeting of shareholders is our supreme corporate body. Under Swiss law, an
annual general meeting of shareholders must be held annually within six months after the end of a
corporation’s financial year. In our case, this generally means on or before June 30. In addition,
extraordinary general meetings of shareholders may be held.
The following powers are vested exclusively in the general meeting of shareholders:
• adopting and amending the articles of association, including changing the Company’s
purpose or registered seat;
• electing and de-selecting the members of the board of directors, the co-chairmen of the
board of directors, the members of the nomination and compensation committee, the
auditors and the independent proxy;
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• approving the annual and management report, the annual statutory and consolidated
financial statements and determining the allocation of profits shown on the balance sheet,
in particular with regard to dividends;
• determining interim dividends and approving the interim financial statements required
thereof;
• passing resolutions on the repayment of the statutory capital reserve (gesetzliche
Kapitalreserve);
• resolving to delist the Company's equity securities;
• approving the aggregate amount of compensation for the members of the board of
directors and the executive committee;
• discharging the members of the board of directors and the executive committee from
liability with respect to their conduct of business; and
• deciding matters reserved for the general meeting of shareholders by law or the articles of
association or submitted by the board of directors.
An extraordinary general meeting of shareholders may be called by a resolution of the board of

directors or the general meeting of shareholders or, under certain circumstances, by the Company’s
auditors, liquidator or the representatives of bondholders, if any. In addition, the board of directors is
required to convene an extraordinary general meeting of shareholders if shareholders representing at
least 5% of the share capital or of the voting rights of our share capital request such general meeting of
shareholders in writing. Such request must set forth the items to be discussed and the proposals to be
acted upon. In case of capital loss (Kapitalverlust), i.e. if, based on our stand-alone annual statutory
balance sheet, the assets less the liabilities no longer cover half of the sum of our share capital, the
statutory capital reserves (gesetzliche Kapitalreserven) not to be repaid to the shareholders and the
statutory retained earnings (gesetzliche Gewinnreserven), our board of directors shall take measures to
rectify such loss of capital. Where necessary, it shall take further measures to restructure the Company
or shall request the general meeting to approve such measures, if they fall within the competence of the
general meeting.
Voting and Quorum Requirements

Shareholder resolutions and elections (including elections of members of the board of directors)
require the affirmative vote of the absolute majority of voting rights represented at the general meeting of
shareholders, unless otherwise stipulated by law or our articles of association.
Under Swiss law and our articles of association, a resolution of the general meeting of the
shareholders passed by two-thirds of the voting rights represented at the meeting and the absolute
majority of the par value of the shares represented is required for:
• amending the Company’s corporate purpose;
• creating or cancelling of voting right shares;
• a consolidation of shares;
• cancelling or amending the transfer restrictions of shares;
• creating conditional share capital or a capital band;
• increasing share capital out of equity, against contributions in-kind or through contribution
by set-off and granting specific benefits;
• a change of the currency of the share capital;
• a conversion of participation certificates into shares;
• introducing a provision in the articles of association regarding the holding of the
shareholders' meeting abroad;
• an introduction in the articles of association of the casting vote of the chairperson at the
general meeting of the shareholders;
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• limiting or withdrawing shareholders’ pre-emptive subscription rights;

• changing the Company’s registered office;
• dissolving or liquidating the Company;
• delisting of the shares; and
• introduction of an arbitration clause in the articles of association.
The same voting requirements apply to resolutions regarding transactions among corporations
based on Switzerland’s Federal Act on Mergers, Demergers, Transformations and the Transfer of Assets
of October 3, 2003, as amended (the “Swiss Merger Act”). See “—Articles of Association— Compulsory
Acquisitions; Appraisal Rights.”
In accordance with Swiss law and generally accepted business practices, our articles of
association do not provide quorum requirements generally applicable to general meetings of
shareholders.
Hybrid, Multilocal and Virtual Shareholders' Meeting
Since January 1, 2023 a shareholders' meeting may take place at several locations
simultaneously, if the votes of the participants are immediately transmitted in sound and image to all
meeting venues (multilocal shareholders' meeting). Furthermore, if the board of directors designates an
independent proxy representative in the invitation to the general meeting of shareholders and the articles
of association contain the necessary provisions in accordance with Swiss law, a shareholders' meeting
may be held abroad. The board of directors may previse that shareholders, which are not present at the
meeting venue of the shareholders' meeting may exercise their rights electronically (hybrid shareholders'
meeting). A virtual shareholders' meeting without a physical meeting venue but using electronic means
(virtual shareholders' meeting) is possible if the articles of association include the necessary provisions
and the board of directors designates an independent proxy representative in the invitation to the
general meeting of shareholders. The board of directors must regulate the use of electronic means and
ensure that (i) the identity of the participants is established; (ii) the votes cast are immediately
transmitted; (iii) each participant may submit requests and participate in the discussion; and (iv) the
results cannot be forged.
Convocation
General meetings of shareholders must be convened by the board of directors at least 20 days
before the date of the meeting. The general meeting of shareholders is convened by way of an invitation
appearing in our official publication medium, currently the Swiss Official Gazette of Commerce.
Registered shareholders may also be informed by ordinary mail or e-mail. The invitation to a general
meeting of shareholders must state (i) the date, the beginning, the type and the place of the general
meeting, (ii) the items on the agenda, (iii) the motions to be decided by the shareholders together with a
brief statement of the reasons therefor and, in case of elections, the names of the nominated
candidates, and (iv) the name and address of the independent proxy representative. A resolution on a
matter that is not on the agenda may not be passed at a general meeting of shareholders, except for
motions to convene an extraordinary general meeting of shareholders, to initiate a special investigation
or to elect the auditors, regarding which the general meeting of shareholders may vote at any time. No
previous notification is required for motions concerning items included in the agenda or for debates that
do not result in a vote.
All of the owners or representatives of our shares may, if no objection is raised, hold a general
meeting of shareholders without complying with the formal requirements for convening general meetings
of shareholders (a universal meeting). This universal meeting of shareholders may discuss and pass
binding resolutions on all matters within the purview of the general meeting of shareholders, provided
that the owners or representatives of all the shares are present at the meeting. As of January 1, 2023,
shareholders may also pass resolutions in written or electronic form without complying with the formal
requirements for convening general meetings of shareholders provided no shareholder requests the
deliberation at a general meeting of shareholders.
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Limitations
There are no limitations under the CO or our articles of association on the right of non-Swiss
residents or nationals to own or vote shares other than the restrictions applicable to all shareholders.
Disclosure of shareholdings
The disclosure obligations generally applicable to shareholders of Swiss corporations under the
Swiss Federal Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives
Trading, or the Financial Market Infrastructure Act (the “FMIA”), do not apply to us since our shares are
not listed on a Swiss exchange and there is no longer a requirement under Swiss law to disclose
significant shareholders and their shareholdings in the notes to their statutory annual financial
statements.
Differences in the law

The Swiss laws applicable to Swiss corporations and their shareholders differ from laws
applicable to U.S. corporations and their shareholders. The following table summarizes significant
differences in shareholder rights between the provisions of the Swiss Code of Obligations
(Obligationenrecht) and the Swiss Ordinance against excessive compensation in listed stock
corporations applicable to our Company and the Delaware General Corporation Law applicable to
companies incorporated in Delaware and their shareholders. Please note that this is only a general
summary of certain provisions applicable to companies in Delaware. Certain Delaware companies may
be permitted to exclude certain of the provisions summarized below in their charter documents. For a
more complete discussion, please refer to the Delaware General Corporation Law, Swiss law, and our
governing articles of association, organizational regulations, and committee charters.
DELAWARE CORPORATE LAW SWISS CORPORATE LAW

Mergers and similar arrangements
Under the Delaware General Corporation Law, Under Swiss law, with certain exceptions, a
with certain exceptions, a merger, consolidation, merger or a demerger of the corporation or a sale
sale, lease or transfer of all or substantially all of of all or substantially all of the assets of a
the assets of a corporation must be approved by corporation must be approved by two-thirds of
the board of directors and a majority of the the voting rights represented at the respective
outstanding shares entitled to vote thereon. A general meeting of shareholders as well as the
shareholder of a Delaware corporation absolute majority of the par value of shares
participating in certain major corporate represented at such general meeting of
transactions may, under certain circumstances, shareholders. A shareholder of a Swiss
be entitled to appraisal rights pursuant to which corporation participating in a statutory merger or
such shareholder may receive cash in the amount demerger pursuant to the Swiss Merger Act
of the fair value of the shares held by such (Fusionsgesetz) can file a lawsuit against the
shareholder (as determined by a court) in lieu of surviving company. If the consideration is deemed
the consideration such shareholder would “inadequate,” such shareholder may, in addition
otherwise receive in the transaction. The Delaware to the consideration (be it in shares or in cash)
General Corporation Law also provides that a receive an additional amount to ensure that such
parent corporation, by resolution of its board of shareholder receives the fair value of the shares
directors, may merge with any subsidiary, of held by such shareholder. Swiss law also provides
which it owns at least 90.0% of each class of that if the merger agreement provides only for a
capital stock without a vote by the shareholders of compensation payment, at least 90.0% of all
such subsidiary. Upon any such merger, members in the transferring legal entity, who are
dissenting shareholders of the subsidiary would entitled to vote, shall approve the merger
have appraisal rights. agreement.
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Shareholders’ suits
Class actions and derivative actions generally are Class actions and derivative actions as such are
available to shareholders of a Delaware not available under Swiss law. Nevertheless,
corporation for, among other things, breach of certain actions may have a similar effect. A
fiduciary duty, corporate waste and actions not shareholder is entitled to bring suit against
taken in accordance with applicable law. In such directors for breach of their duties and claim the
actions, the court has discretion to permit the payment of the company’s losses or damages to
winning party to recover attorneys’ fees incurred the corporation and, in some cases, to the
in connection with such action. individual shareholder. Likewise, an appraisal
lawsuit won by a shareholder may indirectly
compensate all shareholders. Only to the extent
that U.S. laws and regulations provide a basis for
liability and U.S. courts have jurisdiction, a class
action may be available.
Under Swiss law, the winning party is generally
entitled to recover a limited amount of attorneys’
fees incurred in connection with such action. The
court has discretion to permit the shareholder who
lost the lawsuit to recover attorneys’ fees incurred
to the extent that he or she acted in good faith.
Shareholder vote on board and management compensation

Under the Delaware General Corporation Law, the Pursuant to the Swiss Code of Obligations (into
board of directors has the authority to fix the which the provisions of the former [and no longer
compensation of directors, unless otherwise valid] Swiss Ordinance against excessive
restricted by the certificate of incorporation or compensation in listed stock corporations
bylaws. (Verordnung gegen übermässige Vergütungen bei
börsenkotierten Aktiengesellschaften) have been
transposed with effect as of January 1, 2023), the
general meeting of shareholders has the non-
transferable right, amongst others, to vote
separately and bindingly on the aggregate amount
Annual vote on board renewal

Unless directors are elected by written consent in The general meeting of shareholders elects the
lieu of an annual meeting, directors are elected in members of the board of directors, the
an annual meeting of shareholders on a date and (co-)chairperson(s) of the board of directors and
at a time designated by or in the manner provided the members of the compensation committee
in the bylaws. Re-election is possible. individually and annually for a term of office until
the end of the following general meeting of
shareholders. Re-election is possible.
Classified boards are permitted. Terms of office until the next ordinary general
meeting of shareholders are mandatory under
Swiss law for listed companies. Classified boards
are therefore not permitted.
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Indemnification of directors and executive officers and limitation of liability

The Delaware General Corporation Law provides Under Swiss corporate law, an indemnification by
that a certificate of incorporation may contain a the corporation of a director or member of the
provision eliminating or limiting the personal executive committee in relation to potential
liability of directors or officers of the corporation personal liability is not effective to the extent the
for monetary damages for breach of a fiduciary director or member of the executive committee
duty as a director or director, except no provision intentionally or grossly negligently violated his or
in the certificate of incorporation may eliminate or her corporate duties towards the corporation.
limit the liability of: Furthermore, the general meeting of shareholders
may discharge (release) the directors and
• a director or officer for any breach of a members of the executive committee from liability
director’s of officer’s duty of loyalty to the for their conduct to the extent the respective facts
corporation or its shareholders; are known to shareholders. Such discharge is
effective only with respect to claims of the
• a director of officer for acts or omissions company and of those shareholders who
not in good faith or which involve approved the discharge or who have since
intentional misconduct or a knowing acquired their shares in full knowledge of the
violation of law; discharge. Most violations of corporate law are
regarded as violations of duties towards the
• a director for statutory liability for unlawful corporation rather than towards the shareholders.
payment of dividends or unlawful share In addition, indemnification of other controlling
purchase or redemption; persons is not permitted under Swiss corporate
law, including shareholders of the corporation.
• a director or officer for any transaction
from which the director or officer derived The articles of association of a Swiss corporation
an improper personal benefit; or may also set forth that the corporation shall
indemnify and hold harmless, to the extent
• an officer in any action by or in the right of permitted by the law, the directors and executive
the corporation. managers out of assets of the corporation against
threatened, pending or completed actions. Our
articles of association provide for such
indemnification.
A Delaware corporation may indemnify any person Also, a corporation may enter into and pay for
who was or is a party or is threatened to be made directors’ and officers’ liability insurance, which
a party to any proceeding, other than an action by may cover negligent acts as well.
or on behalf of the corporation, because the
person is or was a director or officer, against
liability incurred in connection with the proceeding
if the director or officer acted in good faith and in
a manner reasonably believed to be in, or not
opposed to, the best interests of the corporation;
and the director or officer, with respect to any
criminal action or proceeding, had no reasonable
cause to believe his or her conduct was unlawful.
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Unless ordered by a court, any foregoing

indemnification is subject to a determination that
the director or officer has met the applicable
standard of conduct:
• by a majority vote of the directors who are

not parties to the proceeding, even
though less than a quorum;
• by a committee of directors designated by

a majority vote of the eligible directors,
even though less than a quorum;
• by independent legal counsel in a written

opinion if there are no eligible directors, or
if the eligible directors so direct; or
• by the shareholders.
Moreover, a Delaware corporation may not

indemnify a director or officer in connection with
any proceeding in which the director or officer has
been adjudged to be liable to the corporation
unless and only to the extent that the court
determines that, despite the adjudication of
liability but in view of all the circumstances of the
case, the director or officer is fairly and
reasonably entitled to indemnity for those
expenses which the court deems proper.
Directors’ fiduciary duties
A director of a Delaware corporation has a The board of directors of a Swiss corporation
fiduciary duty to the corporation and its manages the business of the corporation, unless
shareholders. This duty has two components: responsibility for such management has been duly
delegated to the executive board based on
• the duty of care; and organizational regulations. However, there are
several non-transferable duties of the board of
• the duty of loyalty. directors:
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The duty of care requires that a director act in • the overall management of the
good faith, with the care that an ordinarily prudent corporation and the issuing of all
person would exercise under similar necessary directives;
circumstances. Under this duty, a director must
inform himself or herself of, and disclose to • determination of the corporation’s
shareholders, all material information reasonably organization;
available regarding a significant transaction.
• the organization of the accounting,
The duty of loyalty requires that a director act in a financial control and financial planning
manner he or she reasonably believes to be in the systems as required for management of
best interests of the corporation. He or she must the corporation;
not use his or her corporate position for personal
gain or advantage. This duty prohibits self-dealing • the appointment and dismissal of persons
by a director and mandates that the best interest entrusted with managing and representing
of the corporation and its shareholders take the corporation;
precedence over any interest possessed by a
director, officer or controlling shareholder and not • overall supervision of the persons
shared by the shareholders generally. In general, entrusted with managing the corporation,
actions of a director are presumed to have been in particular with regard to compliance
made on an informed basis, in good faith and in with the law, articles of association,
the honest belief that the action taken was in the operational regulations and directives;
best interests of the corporation. However, this
presumption may be rebutted by evidence of a • compilation of the annual report,
breach of one of the fiduciary duties. preparation for the general meeting of the
shareholders, the compensation report
Should such evidence be presented concerning a and implementation of its resolutions; and
transaction by a director, a director must prove
the procedural fairness of the transaction, and • notification of the court in the event that
that the transaction was of fair value to the the company is over-indebted.
corporation.
The members of the board of directors must
perform their duties with all due diligence and
safeguard the interests of the corporation in good
faith. They must afford the shareholders equal
treatment in equal circumstances.
The duty of care requires that a director act in
good faith, with the care that an ordinarily prudent
director would exercise under like circumstances.
The members of the board of directors and the
executive committee are also required to
immediately and fully inform the board of directors
about conflicts of interests concerning them. The
board of directors is furthermore required to take
measures in order to protect the interests of the
company.
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The duty of loyalty requires that a director

safeguard the interests of the corporation and
requires that directors act in the interest of the
corporation and, if necessary, put aside their own
interests. If there is a risk of a conflict of interest,
the board of directors must take appropriate
measures to ensure that the interests of the
company are duly taken into account.
The burden of proof for a violation of these duties
is with the corporation or with the shareholder
bringing a suit against the director.
The Swiss Federal Supreme Court established a
doctrine that restricts its review of a business
decision if the decision has been taken following
proper preparation, on an informed basis and
without conflicts of interest.
Shareholder action by written consent

A Delaware corporation may, in its certificate of Shareholders of a Swiss corporation may only
incorporation, eliminate the right of shareholders exercise their voting rights in a general meeting of
to act by written consent. shareholders and may not act by written
consents. The articles of association must allow
for (independent) proxies to be present at a
general meeting of shareholders. The instruction
of such (independent) proxies may occur in writing
or electronically.
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Shareholder proposals
A shareholder of a Delaware corporation has the At any general meeting of shareholders any
right to put any proposal before the annual shareholder may put proposals to the meeting if
meeting of shareholders, provided it complies with the proposal is part of an agenda item. No
the notice provisions in the governing documents. resolution may be taken on proposals relating to
A special meeting may be called by the board of the agenda items that were not duly notified.
directors or any other person authorized to do so Unless the articles of association provide for a
in the governing documents, but shareholders lower threshold or for additional shareholders’
may be precluded from calling special meetings. rights (as is the case in our articles of association,
which already reflect lower thresholds as per the
recent Swiss corporate law reform):
• one or several shareholders together

representing at least 5% of the share
capital may request in writing that a
general meeting of shareholders be called
for specific agenda items and specific
proposals; and
• one or several shareholders together

representing shares with a par value of at
least 0.5% of the share capital, whichever
is lower, may request in writing that an
agenda item including a specific proposal
be put on the agenda for a scheduled
general meeting of shareholders, provided
such request is made with appropriate
lead time.
Any shareholder can propose candidates for
election as directors or make other proposals
within the scope of an agenda item without prior
written notice.
In addition, any shareholder is entitled, at a
general meeting of shareholders and without
advance notice, to (i) request information from the
board of directors on the affairs of the company
(note, however, that the right to obtain such
information is limited), (ii) request information from
the auditors on the methods and results of their
audit, (iii) request that the general meeting of
shareholders resolve to convene an extraordinary
general meeting, or (iv) request that the general
meeting of shareholders resolve to appoint an
examiner to carry out a special examination
(Sonderuntersuchung).
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Cumulative voting
Under the Delaware General Corporation Law, Cumulative voting is not permitted under Swiss
cumulative voting for elections of directors is not corporate law. Pursuant to Swiss law,
permitted unless the corporation’s certificate of shareholders can vote for each proposed
incorporation provides for it. candidate, but they are not allowed to cumulate
their votes for single candidates. An annual
individual election of (i) all members of the board
of directors, (ii) the (co-)chairperson(s) of the
board of directors, (iii) the members of the
compensation committee, (iv) the election of the
independent proxy for a term of office of one year
(i.e., until the following annual general meeting of
shareholders), as well as the vote on the
aggregate amount of compensation of the
members of the board of directors, of the
executive committee and of the members of any
advisory board, is mandatory for listed
companies.
Removal of directors
A Delaware corporation with a classified board A Swiss corporation may remove, with or without
may be removed only for cause with the approval cause, any director at any time with a resolution
of a majority of the outstanding shares entitled to passed by a majority of the voting rights
vote, unless the certificate of incorporation represented at a general meeting of shareholders
provides otherwise. where a proposal for such removal was properly
set on the agenda.
Transactions with interested shareholders

The Delaware General Corporation Law generally No such rule applies to a Swiss corporation.
prohibits a Delaware corporation from engaging in
certain business combinations with an “interested
shareholder” for three years following the date
that such person becomes an interested
shareholder. An interested shareholder generally
is a person or group who or which owns or owned
15.0% or more of the corporation’s outstanding
voting shares within the past three years.
Dissolution; Winding up
Unless the board of directors of a Delaware A dissolution of a Swiss corporation requires the
corporation approves the proposal to dissolve, approval by two-thirds of the voting rights
dissolution must be approved by shareholders represented at the respective general meeting of
holding 100.0% of the total voting power of the shareholders as well as the absolute majority of
corporation. Only if the dissolution is initiated by the par value of shares represented at such
the board of directors may it be approved by a general meeting of shareholders. The articles of
simple majority of the corporation’s outstanding association may increase the voting thresholds
shares. Delaware law allows a Delaware required for such a resolution.
corporation to include in its certificate of
incorporation a supermajority voting requirement
in connection with dissolutions initiated by the
board.
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Dissolution by law or court order is possible if, for

example, a corporation becomes bankrupt.
Under Swiss law, any surplus arising out of a
liquidation (after the settlement of all claims of all
creditors) is distributed to shareholders in
proportion to the paid up par value of shares held.
The articles of association may provide for
different form of distribution.
Variation of rights of shares

A Delaware corporation may vary the rights of a The general meeting of shareholders of a Swiss
class of shares with the approval of a majority of corporation may resolve that preference shares be
the outstanding shares of such class, unless the issued or that existing shares be converted into
certificate of incorporation provides otherwise. preference shares with a resolution passed by a
majority of the shares represented at the general
meeting of shareholders. Where a company has
issued preference shares, further preference
shares conferring preferential rights over the
existing preference shares may be issued only
with the consent of both a special meeting of the
adversely affected holders of the existing
preference shares and of a general meeting of all
shareholders, unless otherwise provided in the
articles of association.
Shares with preferential voting rights (such as our
Class B voting rights shares) are not regarded as
preference shares for these purposes.
Amendment of governing documents

A Delaware corporation’s governing documents The articles of association of a Swiss corporation
may be amended with the approval of a majority may be amended with a resolution passed by a
of the outstanding shares entitled to vote, unless majority of the voting rights represented at a
the certificate of incorporation provides otherwise. general meeting of shareholders, unless otherwise
provided in the articles of association.
There are a number of resolutions, such as an
amendment of the stated purpose of the
corporation, the introduction of conditional capital
and of a capital band and the introduction of
shares with preferential voting rights, that require
the approval by two-thirds of the voting rights and
an absolute majority of the par value of the shares
represented at such general meeting of
shareholders. The articles of association may
increase these voting thresholds.
Subject to certain requirements, shareholders may
submit a proposal to amend the articles of
association to be voted on at a general meeting of
shareholders.
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Inspection of books and records

Shareholders of a Delaware corporation, upon Under Swiss law, a shareholder may request to
written demand under oath stating the purpose inspect a corporation’s minutes of general
thereof, have the right during the usual hours for meetings of shareholders. A corporation’s annual
business to inspect for any proper purpose, and report, compensation report and the auditors’
to obtain copies of list(s) of shareholders and reports must be made available for inspection by
other books and records of the corporation and its shareholders at the corporation’s registered office
subsidiaries, if any, to the extent the books and at least 20 calendar days prior to each annual
records of such subsidiaries are available to the general meeting of shareholders. Shareholders
corporation. registered in the share register of a corporation
must be notified of the availability of these
documents in writing. Any shareholder may
request a copy of these reports in advance of, or
after, the relevant annual general meeting of
shareholders.
Shareholders holding in the aggregate at least 5%
of the nominal share capital or of the voting rights
of a Swiss corporation may only inspect books
and records if the general meeting of shareholders
or the board of directors approved such
inspection. The information may be refused where
providing it would jeopardize the corporation’s
trade secrets or other interests warranting
protection. A shareholder is only entitled to
receive information to the extent required to
exercise his or her rights as a shareholder, subject
to the interests of the corporation. A shareholder’s
right to inspect the share register is limited to the
right to inspect his or her own entry in the share
register.
Furthermore, the board of directors is required to
grant the inspection request within four months
after receipt of such request. Denial of the request
will need to be justified in writing. In case an
inspection or information request is denied by the
board of directors, shareholders may request the
order of an inspection or information right by the
court within thirty days.
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Payment of dividends
The board of directors may approve a dividend Dividend payments are subject to the approval of
without shareholder approval. Subject to any the general meeting of shareholders. The board of
restrictions contained in its certificate of directors may propose to shareholders that a
incorporation, the board may declare and pay dividend shall be paid but cannot itself authorize
dividends upon the shares of its capital stock the distribution.
either:
Payments out of a Swiss corporation’s share
• out of its surplus, or capital (in other words, the aggregate par value of
the corporation’s registered share capital) in the
• in case there is no such surplus, out of its form of dividends are not allowed and may be
net profits for the fiscal year in which the made only by way of a share capital reduction.
dividend is declared and/or the preceding Dividends may be paid only from the profits of the
fiscal year. previous business year or brought forward from
previous business years or if the corporation has
Shareholder approval is required to authorize freely distributable reserves, each as evidenced
capital stock in excess of that provided in the by the corporation’s audited stand-alone statutory
charter. Directors may issue authorized shares balance sheet prepared pursuant to Swiss law,
without shareholder approval. after allocations to reserves required by Swiss law
and the articles of association have been
deducted and the corporation’s statutory auditors
have confirmed that the dividend proposal
complies with Swiss law and the corporation’s
articles of association.
Swiss corporations are permitted to pay interim
dividends out of the current business year’s
profits based on an audited interim account.
Creation and issuance of new shares

All creations of shares require the board of All creations of shares require a shareholders’
directors to adopt a resolution or resolutions, resolution.
pursuant to authority expressly vested in the
board of directors by the provisions of the A capital band (Kapitalband), if resolved by the
company’s certificate of incorporation. general meeting of shareholders, will authorize the
board of directors at any time within 5 (five) years
to increase or decrease the share capital by a
maximum amount of 50% of the current share
capital.
The creation of conditional share capital requires

at least two-thirds of the voting rights represented
at the general meeting of shareholders and an
absolute majority of the par value of shares
represented at such meeting. Shares are created
and issued out of conditional share capital
through the exercise of options or of conversion
rights that the board of directors may grant in
relation to, e.g., debt instruments or employees.
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Changes in capital
The requirements of the articles of association regarding changes in capital are not more
stringent than the requirements of Swiss law.
C. Material Contracts
Neither the Company nor its subsidiaries has been a party, within the two years immediately
preceding this Form 20-F, to a contract that is material to the Company, other than (i) material contracts
entered into in the ordinary course of business and (ii) the CHF 700 million multicurrency credit facility
agreement described under “Item 5. Operating and Financial Review and Prospects—B. Liquidity and
Capital Resources—Indebtedness.”
D. Exchange Controls
There are no Swiss governmental laws, decrees or regulations that affect – in a manner material
to On Holding AG – the export or import of capital, including the availability of cash and cash equivalents
for use by the Company or the remittance of dividends, interest or other payments to non-residents or
non-citizens of Switzerland who hold On Holding AG securities, other than tax withholding requirements
as discussed below (see "Taxation").
E. Taxation
The following summary contains a description of certain Swiss and U.S. federal income tax
consequences of the acquisition, ownership and disposition of Class A ordinary shares, but it does not
purport to be a comprehensive description of all the tax considerations that may be relevant to a
decision to purchase Class A ordinary shares. The summary is based upon the tax laws of and
regulations thereunder and on the tax laws of the United States and regulations thereunder as of the
date hereof, which are subject to change.
Swiss Tax Considerations
Withholding Tax
Under present Swiss tax law, dividends due and similar cash or in-kind distributions made by
the Company to a shareholder of Class A ordinary shares (including liquidation proceeds, bonus shares
and taxable repurchases of Class A ordinary shares as described above) are subject to Swiss federal
withholding tax (“Withholding Tax”), currently at a rate of 35% (applicable to the gross amount of taxable
distribution). The Company is obliged to deduct the Withholding Tax from the gross amount of any
taxable distribution and to pay the tax to the Swiss Federal Tax Administration within 30 days of the due
date of such distribution. The repayment of the par value of the Class A ordinary shares and any
repayment of qualifying additional paid-in capital (capital contribution reserves confirmed by Swiss
Federal Tax Administration, Reserven aus Kapitaleinlagen bestätigt durch die Eidgenössische
Steuerverwaltung), within the limitations accepted by the legislation in force when such dividend
becomes due and the respective administrative practice, are not subject to the Withholding Tax.
Swiss resident individuals who hold their Class A ordinary shares as private assets (“Resident
Private Shareholders”) are in principle eligible for a full refund or credit against income tax of the
Withholding Tax if they duly report the underlying income in their income tax return. In addition, (i)
corporate and individual shareholders who are resident in Switzerland for tax purposes, (ii) corporate and
individual shareholders who are not resident in Switzerland, and who, in each case, hold their Class A
ordinary shares as part of a trade or business carried on in Switzerland through a permanent
establishment with fixed place of business situated in Switzerland for tax purposes and (iii) Swiss
resident private individuals who, for income tax purposes, are classified as “professional securities
dealers” for reasons of, inter alia, frequent dealing, or leveraged investments, in shares and other
securities (collectively, “Domestic Commercial Shareholders”) are in principle eligible for a full refund or
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credit against income tax of the Withholding Tax if they, inter alia, duly report the underlying income in
their income statements or income tax return, as the case may be.
Shareholders who are not resident in Switzerland for tax purposes, and who, during the
respective taxation year, have not engaged in a trade or business carried on through a permanent
establishment with fixed place of business situated in Switzerland for tax purposes, and who are not
subject to corporate or individual income taxation in Switzerland for any other reason (collectively, “Non-
Resident Shareholders”) may be entitled to a total or partial refund of the Withholding Tax if the country
in which such recipient resides for tax purposes maintains a bilateral treaty for the avoidance of double
taxation with Switzerland and further conditions of such treaty are met. Non-Resident Shareholders
should be aware that the procedures for claiming treaty benefits (and the time required for obtaining a
refund) may differ from country to country. Non-Resident Shareholders should consult their own legal,
financial or tax advisors regarding receipt, ownership, purchases, sale or other dispositions of Class A
ordinary shares and the procedures for claiming a refund of the Withholding Tax.
Swiss Federal Stamp Taxes

Any transactions in Class A ordinary shares in the secondary markets are subject to Swiss
securities turnover tax at an aggregate rate of 0.15% of the consideration paid for such Class A ordinary
shares, however, only if a bank or other securities dealer in Switzerland or Liechtenstein, as defined in
the Swiss Federal Stamp Tax Act (Stempelabgabengesetz), is a party or an intermediary to the
transaction and no exemption applies.
Swiss Federal, Cantonal and Communal Individual Income Tax and Corporate Income Tax
Non-Resident Shareholders
Non-Resident Shareholders are not subject to any Swiss federal, cantonal or communal income
tax on dividend payments and similar distributions because of the mere holding of Class A ordinary
shares. The same generally applies for capital gains on the sale of Class A ordinary shares. For
Withholding Tax consequences, see “—Swiss Tax Considerations—Withholding Tax.”
Resident Private Shareholders and Domestic Commercial Shareholders

Resident Private Shareholders who receive dividends and similar cash or in-kind distributions
(including liquidation proceeds as well as bonus shares or taxable repurchases of Class A ordinary
shares as described above), which are not repayments of the par value of Class A ordinary shares or,
within the limitations accepted by the legislation in force and the respective administrative practice,
qualifying additional paid-in capital, are required to report such distributions in their individual income
tax returns. A gain or a loss by Resident Private Shareholders realized upon the sale or other disposition
of Class A ordinary shares to a third party will generally be a tax-free private capital gain or a not tax-
deductible capital loss, as the case may be.
Domestic Commercial Shareholders who receive dividends and similar cash or in-kind
distributions (including liquidation proceeds as well as bonus shares) are required to recognize such
payments in their income statements for the relevant tax period and are subject to Swiss federal,
cantonal and communal individual or corporate income tax, as the case may be, on any net taxable
earnings accumulated (including the dividends) for such period. Domestic Commercial Shareholders
who are corporate taxpayers may qualify for participation relief on dividend distributions
(Beteiligungsabzug), if, inter alia, Class A ordinary shares held have a market value of at least CHF 1
million. For cantonal and communal income tax purposes, the regulations on participation relief are
broadly similar, depending on the canton of residency.
Domestic Commercial Shareholders are required to recognize a gain or loss realized upon the
disposal of Class A ordinary shares in their income statement for the respective taxation period and are
subject to Swiss federal, cantonal and communal individual or corporate income tax, as the case may
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be, on any net taxable earnings (including the gain or loss realized on the sale or other disposition of
ordinary shares) for such taxation period.
Swiss Wealth Tax and Capital Tax
Non-Resident Shareholders
Non-Resident Shareholders holding Class A ordinary shares are not subject to cantonal and
communal wealth or annual capital tax because of the mere holding of Class A ordinary shares.
Resident Private Shareholders

Resident Private Shareholders are required to report the market value of their Class A ordinary
shares at the end of each tax period as part of their private wealth and which is subject to cantonal and
communal wealth tax.
Domestic Commercial Shareholders

Domestic Commercial Shareholders are required to report their ordinary shares as part of their
business wealth or taxable capital, as defined, and which is subject to cantonal and communal wealth or
annual capital tax.
Automatic Exchange of Information in Tax Matters

On November 19, 2014, Switzerland signed the Multilateral Competent Authority Agreement.
The Multilateral Competent Authority Agreement is intended to ensure the uniform implementation of
Automatic Exchange of Information (the “AEOI”). The Swiss Federal Act on the International Automatic
Exchange of Information in Tax Matters (the “AEOI Act”) entered into force on January 1, 2017. The AEOI
Act is the legal basis for the implementation of the AEOI standard in Switzerland.
The AEOI is being introduced in Switzerland through bilateral agreements or multilateral
agreements. The agreements have been, and will be, concluded on the basis of guaranteed reciprocity,
compliance with the principle of specialty (i.e., the information exchanged may only be used to assess
and levy taxes (and for criminal tax proceedings)) and adequate data protection.
Based on such multilateral and bilateral agreements and the implementing laws of Switzerland,
Switzerland collects data in respect of financial assets, which may include Class A ordinary shares of the
Company, held in, and income derived thereon and credited to, accounts or deposits with a paying
agent in Switzerland for the benefit of individuals resident in a EU member state or in a treaty state since
2017, and exchanges it since 2018. Switzerland has signed and is expected to sign AEOI agreements
with other countries. A list of such agreements of Switzerland in effect or signed and becoming effective
can be found on the website of the State Secretariat for International Finance.
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Swiss Facilitation of the Implementation of the U.S. Foreign Account Tax Compliance Act
Switzerland has concluded an intergovernmental agreement with the United States to facilitate
the implementation of U.S. Foreign Account Tax Compliance Act. The agreement ensures that the
accounts held by U.S. persons with Swiss financial institutions are disclosed to the U.S. tax authorities
either with the consent of the account holder or by means of group requests within the scope of
administrative assistance. Information will not be transferred automatically in the absence of consent,
and instead will be exchanged only within the scope of administrative assistance on the basis of the
double taxation agreement between the United States and Switzerland. On October 8, 2014, the Swiss
Federal Council approved a mandate for negotiations with the United States on changing the current
direct-notification-based regime to a regime where the relevant information is sent to the Swiss Federal
Tax Administration, which in turn provides the information to the U.S. tax authorities.
U.S. Tax Considerations

The following section describes the material U.S. federal income tax consequences to U.S.
Holders, as defined below, of owning and disposing of Class A ordinary shares. It does not set forth all
tax considerations that may be relevant to a particular person’s decision to acquire Class A ordinary
shares.
This section applies only to a U.S. Holder that holds Class A ordinary shares as capital assets
for U.S. federal income tax purposes. This section does not include a description of the state, local or
non-U.S. tax consequences that may be relevant to U.S. Holders, nor does it address U.S. federal tax
consequences (such as gift and estate taxes) other than income taxes. In addition, it does not set forth
all of the U.S. federal income tax consequences that may be relevant in light of the U.S. Holder’s
particular circumstances, including alternative minimum tax consequences, rules conforming the timing
of income accruals with respect to the Class A ordinary shares to financial statements under Section
451(b) of the Code, the potential application of the provisions of the Code known as the Medicare
contribution tax and tax consequences applicable to U.S. Holders subject to special rules, such as:
• certain financial institutions;
• dealers or traders in securities who use a mark-to-market method of tax accounting;
• persons holding Class A ordinary shares as part of a hedging transaction, straddle, wash
sale, conversion transaction or other integrated transaction or persons entering into a
constructive sale with respect to the Class A ordinary shares;
• persons whose functional currency for U.S. federal income tax purposes is not the U.S.
dollar;
• entities classified as partnerships or S corporations for U.S. federal income tax purposes;
• persons who acquire our Class A ordinary shares through the exercise of an option or
otherwise as compensation;
• tax-exempt entities, including an “individual retirement account” or “Roth IRA”;
• real estate investment trusts or regulated investment companies;
• former U.S. citizens or long-term residents of the United States;
• persons that own or are deemed to own 10% or more of our shares (by vote or value); or
• persons holding Class A ordinary shares in connection with a trade or business conducted
outside of the United States or in connection with a permanent establishment or other fixed
place of business outside of the United States.
If an entity or arrangement that is classified as a partnership for U.S. federal income tax
purposes holds Class A ordinary shares, the U.S. federal income tax treatment of a partner will generally
depend on the status of the partner and the activities of the partnership. Partnerships holding Class A
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ordinary shares and partners in such partnerships should consult their tax advisers as to the particular
U.S. federal income tax consequences of owning and disposing of the Class A ordinary shares.
This section is based on the Code, administrative pronouncements, judicial decisions, final,
temporary and proposed Treasury regulations, and the income tax treaty between the Switzerland and
the United States, or the “Treaty”, all as of the date hereof, any of which is subject to change or differing
interpretations, possibly with retroactive effect. Any change or different interpretation could alter the tax
consequences to U.S. Holders described in this section. In addition, there can be no assurance that the
Internal Revenue Service, or IRS, will not challenge one or more of the tax consequences described in
this section.
A “U.S. Holder” is a holder who, for U.S. federal income tax purposes, is a beneficial owner
Class A ordinary shares, who is eligible for the benefits of the Treaty and who is:
• a citizen or individual resident of the United States;
• a corporation, or other entity taxable as a corporation, created or organized in or under the
laws of the United States, any state therein or the District of Columbia; or
• an estate or trust the income of which is subject to U.S. federal income taxation regardless
of its source.
U.S. Holders should consult their tax advisers concerning the U.S. federal, state, local and non-
U.S. tax consequences of owning and disposing of Class A ordinary shares in their particular
circumstances.
Taxation of Distributions
We do not currently expect to make distributions on our Class A ordinary shares. In the event
that we do make distributions of cash or other property, subject to the passive foreign investment
company rules described below, distributions paid on Class A ordinary shares, other than certain pro
rata distributions of Class A ordinary shares, will be treated as dividends to the extent paid out of our
current or accumulated earnings and profits (as determined under U.S. federal income tax principles). To
the extent that the amount of the distribution exceeds our current and accumulated earnings and profits
(as determined under U.S. federal income tax principles), such excess amount will be treated first as a
tax-free return of a U.S. Holder’s tax basis in the Class A ordinary shares, and then, to the extent such
excess amount exceeds such holder’s tax basis in the Class A ordinary shares, as capital gain.
However, we currently do not, and we do not intend to calculate our earnings and profits under United
States federal income tax principles. Therefore, a U.S. Holder should expect that any distribution will
generally be reported as a dividend even if that distribution would otherwise be treated as a non-taxable
return of capital or as capital gain under the rules described above.
Subject to certain holding-period requirements and the passive foreign investment company
rules described below, for so long as our Class A ordinary shares are listed on the NYSE or another
established securities market in the United States or we are eligible for benefits under the Treaty,
dividends paid to certain non-corporate U.S. Holders will generally be eligible for taxation as “qualified
dividend income,” which, subject to applicable limitations, is taxable at rates not in excess of the long-
term capital gain rate applicable to such U.S. Holders. U.S. Holders should consult their tax advisers
regarding the availability of the reduced tax rate on dividends in their particular circumstances.
The amount of a dividend will include any amounts withheld by us or an applicable withholding
agent in respect of Swiss income taxes. The amount of the dividend will be treated as foreign-source
dividend income to U.S. Holders and will not be eligible for the dividends-received deduction available to
U.S. corporations under the Code. Dividends will be included in a U.S. Holder’s income on the date of
the U.S. Holder’s receipt of the dividend. The amount of any dividend income paid in Swiss francs will
be the U.S. dollar amount calculated by reference to the exchange rate in effect on the date of actual or
constructive receipt, regardless of whether the payment is in fact converted into U.S. dollars at that time.
A U.S. Holder may have foreign currency gain or loss if the dividend is converted into U.S. dollars after
the date of receipt.
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Subject to applicable limitations, some of which vary depending upon the U.S. Holder’s
particular circumstances, Swiss income taxes withheld from dividends on Class A ordinary shares (at a
rate not exceeding the rate provided by the Treaty, in the case of a U.S. Holder eligible for a reduced
rate under the Treaty) will be creditable against the U.S. Holder’s U.S. federal income tax liability. The
rules governing foreign tax credits are complex and U.S. Holders should consult their tax advisers
regarding the creditability of foreign taxes in their particular circumstances. In lieu of claiming a foreign
tax credit, U.S. Holders may, at their election, deduct foreign taxes, including any Swiss income tax, in
computing their taxable income, subject to generally applicable limitations under U.S. law. An election to
deduct foreign taxes instead of claiming foreign tax credits applies to all foreign taxes paid or accrued in
the taxable year.
Sale or Other Disposition of Class A ordinary shares

Subject to the passive foreign investment company rules described below, gain or loss realized
on the sale or other disposition of Class A ordinary shares will be capital gain or loss, and will be long-
term capital gain or loss if the U.S. Holder held the Class A ordinary shares for more than one year. The
amount of the gain or loss will equal the difference between the U.S. Holder’s tax basis in the Class A
ordinary shares disposed of and the amount realized on the disposition, in each case as determined in
U.S. dollars. This gain or loss will generally be U.S.-source gain or loss for foreign tax credit purposes.
The deductibility of capital losses is subject to various limitations. U.S. Holders should consult their tax
advisers regarding the proper treatment of gain or loss in their particular circumstances, including the
effects of any applicable income tax treaties.
Passive Foreign Investment Company Rules

Under the Code, we will be a PFIC for any taxable year in which, after the application of certain
“look-through” rules with respect to subsidiaries, either (i) 75% or more of our gross income consists of
“passive income,” or (ii) 50% or more of the average quarterly value of our assets consist of assets that
produce, or are held for the production of, “passive income” (including cash). For purposes of the above
calculations, we will be treated as if we hold our proportionate share of the assets of, and receive
directly our proportionate share of the income of, any other corporation in which we directly or indirectly
own at least 25%, by value, of the shares of such corporation. Passive income includes, among other
things, interest, dividends, rents, certain non-active royalties and capital gains.
Based on the market price of our Class A ordinary shares during 2023 and the composition of
our income and assets, including goodwill, we believe that we were not a PFIC for our 2023 taxable year.
Even if we have determined that we are not a PFIC for a taxable year, there can be no assurance that the
IRS will agree with our conclusion or that the IRS would not successfully challenge our position. The
determination of whether we are a PFIC is a fact-intensive determination that must be made on an
annual basis applying principles and methodologies that are in some circumstances unclear, and
whether we were a PFIC in 2023 is uncertain in several respects. Moreover, our PFIC status for any
taxable year will depend on the composition of our income and assets and the value of our assets from
time to time (which may be determined, in part, by reference to the market price of our Class A ordinary
shares, which may fluctuate substantially over time). Accordingly, there can be no assurance that we will
not be a PFIC for any future taxable year. If we are a PFIC for any year during which a U.S. Holder holds
Class A ordinary shares, we would continue to be treated as a PFIC with respect to that U.S. Holder for
all succeeding years during which the U.S. Holder holds Class A ordinary shares, even if we ceased to
meet the threshold requirements for PFIC status, unless the U.S. Holder makes a valid deemed sale or
deemed dividend election under the applicable Treasury regulations with respect to its Class A ordinary
shares. If the deemed sale election is made, the U.S. Holder will be deemed to sell the Class A ordinary
shares it holds at their fair market value on the “qualification date,” which may result in recognition of
gain (but not loss) without the receipt of any corresponding cash. If the deemed dividend election is
made, the U.S. Holder must include in income its pro rata share of our post-1986 earnings and profits
attributable to the Class A ordinary shares held on the “qualification date” without the receipt of any
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corresponding cash. After the deemed sale or deemed dividend election, the U.S. Holder’s Class A
ordinary shares would not be treated as shares of a PFIC unless we subsequently again become a PFIC.
If we are a PFIC for any taxable year during which a U.S. Holder holds Class A ordinary shares
and one of our subsidiaries or other entity in which we held a direct or indirect equity interest is also a
PFIC (i.e., a Lower-tier PFIC), such U.S. Holder would be treated as owning a proportionate amount (by
value) of the shares of the Lower-tier PFIC and would be subject to U.S. federal income tax under the
PFIC excess distribution regime on certain distributions by the Lower-tier PFIC and on gain from the
disposition of shares of the Lower-tier PFIC, even though such U.S. Holder would not receive the
proceeds of those distributions or dispositions. In addition, any mark-to-market election (as described
below) made for Class A ordinary share will not apply to shares of the Lower-tier PFIC. U.S. Holders
should consult their tax advisers regarding the application of the PFIC rules to our non-U.S. subsidiaries.
If we were a PFIC for any taxable year during which a U.S. Holder held Class A ordinary shares
(assuming such U.S. Holder has not made a timely mark-to-market or QEF Election, as described
below), gain recognized by a U.S. Holder on a sale or other disposition (including certain pledges) of the
Class A ordinary shares would be allocated ratably over the U.S. Holder’s holding period for the Class A
ordinary shares. The amounts allocated to the taxable year of the sale or other disposition and to any
year before we became a PFIC would be taxed as ordinary income. The amount allocated to each other
taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as
appropriate, for that taxable year, and an interest charge would be imposed on the amount allocated to
that taxable year. Further, to the extent that any distribution received by a U.S. Holder on its Class A
ordinary shares exceeds 125% of the average of the annual distributions on the Class A ordinary shares
received during the preceding three years or the U.S. Holder’s holding period, whichever is shorter, that
distribution would be subject to taxation in the same manner as gain, described immediately above.
A U.S. Holder can avoid certain of the adverse rules described above by making a mark-to-
market election with respect to its Class A ordinary shares, provided that the Class A ordinary shares are
“marketable.” Our Class A ordinary shares will be marketable if they are “regularly traded” on a “qualified
exchange” or other market within the meaning of applicable Treasury regulations. If a U.S. Holder makes
the mark-to-market election, it will recognize as ordinary income any excess of the fair market value of
the Class A ordinary shares at the end of each taxable year over their adjusted tax basis, and will
recognize an ordinary loss in respect of any excess of the adjusted tax basis of the Class A ordinary
shares over their fair market value at the end of the taxable year (but only to the extent of the net amount
of income previously included as a result of the mark-to-market election). If a U.S. Holder makes the
election, the U.S. Holder’s tax basis in the Class A ordinary shares will be adjusted to reflect the income
or loss amounts recognized. Any gain recognized on the sale or other disposition of Class A ordinary
shares in a year when we are a PFIC will be treated as ordinary income and any loss will be treated as an
ordinary loss (but only to the extent of the net amount of income previously included as a result of the
mark-to-market election).
In addition, in order to avoid the application of the foregoing rules, a United States person that
owns shares in a PFIC for U.S. federal income tax purposes may make a QEF Election with respect to
such PFIC if the PFIC provides the information necessary for such election to be made. If a United
States person makes a QEF Election with respect to a PFIC, the United States person will be currently
taxable on its pro rata share of the PFIC’s ordinary earnings and net capital gain (at ordinary income and
capital gain rates, respectively) for each taxable year that the entity is classified as a PFIC and will not be
required to include such amounts in income when actually distributed by the PFIC. We do not intend to
provide information necessary for U.S. Holders to make QEF Elections.
In addition, if we were a PFIC or, with respect to a particular U.S. Holder, were treated as a PFIC
for the taxable year in which we paid a dividend or for the prior taxable year, the preferential dividend
rates discussed above with respect to dividends paid to certain non-corporate U.S. Holders would not
apply.
If a U.S. Holder owns Class A ordinary shares during any year in which we are a PFIC or in which
we hold a direct or indirect equity interest is a Lower-tier PFIC, the U.S. Holder generally must file annual
reports, containing such information as the U.S. Treasury may require on IRS Form 8621 (or any
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successor form) with respect to us, with the U.S. Holder’s federal income tax return for that year, unless
otherwise specified in the instructions with respect to such form.
U.S. Holders should consult their tax advisers concerning our potential PFIC status and the
potential application of the PFIC rules.
Information Reporting and Backup Withholding

Payments of dividends and sales proceeds that are made within the United States or through
certain U.S.-related financial intermediaries are subject to information reporting, and may be subject to
backup withholding, unless (i) the U.S. Holder is a corporation or other exempt recipient or (ii) in the case
of backup withholding, the U.S. Holder provides a correct taxpayer identification number and certifies
that it is not subject to backup withholding. The amount of any backup withholding from a payment to a
U.S. Holder will be allowed as a credit against the holder’s U.S. federal income tax liability and may
entitle it to a refund, provided that the required information is timely furnished to the IRS.
Reporting with Respect to Foreign Financial Assets

Certain U.S. Holders who are individuals and certain entities may be required to report
information relating to an interest in our Class A ordinary shares by filing a Form 8938 with their U.S.
federal income tax return, subject to certain exceptions (including an exception for Class A ordinary
shares held in accounts maintained by certain U.S. financial institutions). Failure to file a Form 8938
where required can result in monetary penalties and the extension of the relevant statute of limitations
with respect to all or a part of the relevant U.S. tax return. U.S. Holders should consult their tax advisers
regarding this reporting requirement.
F. Dividends and Paying Agents

Not applicable.
G. Statement by Experts
Not applicable.
H. Documents on Display
We are required to file or furnish reports and other information with the SEC under the Exchange
Act and regulations under that act. As a foreign private issuer, we are exempt from the rules under the
Exchange Act prescribing the form and content of proxy statements, and our officers, directors and
principal shareholders are exempt from the reporting and short swing profit recovery provisions
contained in Section 16 of the Exchange Act.
Our website is www.on.com. We make available, free of charge, on our website our Annual
Reports on Form 20-F, Reports on Form 6-K and amendments to those reports as soon as reasonably
practicable after we electronically file such material with, or furnish it to, the SEC. No information
contained on our website is intended to be included as part of, or incorporated by reference into, this
Annual Report on Form 20-F.
In addition, the SEC maintains an internet site at http://www.sec.gov that contains reports and
other information regarding issuers that file electronically with the SEC.
I. Subsidiary Information
Not applicable.
J. Annual Report to Security Holders
Not applicable.
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ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain market risks arising from transactions in the normal course of
business. Such risk is principally associated with foreign currency exchange rates. See further
discussion in "Item 5. Operating and Financial Review and Prospects."
The information set forth under “Item 18. Financial Statements—Note 5. Risk management" is
incorporated by reference.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
A. Debt Securities
Not applicable.
B. Warrants and Rights

Not applicable.
C. Other Securities
Not applicable.
D. American Depositary Shares

Not applicable.
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PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS
On May 25, 2023, at the Annual General Shareholders’ Meeting, we amended and restated our
memorandum and articles of association. A copy of our amended and restated memorandum and
articles of association was filed as Exhibit 99.1 on Form 6-K, filed on May 26, 2023.
Use of Proceeds
On September 17, 2021, we completed an IPO of our Class A ordinary shares. The shares
offered and sold in the IPO were registered under the Securities Act pursuant to our Registration
Statement on Form F-1 (File No. 333-258998), which was declared effective by the SEC on September
14, 2021. The IPO generated proceeds to us of approximately CHF 652.5 million (USD 702.2 million)
before deducting underwriting discounts and commissions, fees and expenses payable.
Since the effective date of the registration statement, we have used the net proceeds from the
offering for general corporate purposes. None of the net proceeds were used to make payments (other
than compensation paid to our executive officers and directors, each as described in this Annual Report),
directly or indirectly, to (i) any of our directors, officers or their associates, (ii) any persons owning 10% or
more of our shares or (iii) any of our affiliates.
ITEM 15. CONTROLS AND PROCEDURES

(a) Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act) designed to ensure that information required to be disclosed in the
Company's reports filed or submitted under the Exchange Act is recorded, processed, authorized,
summarized and reported within the time periods specified in the SEC's rules and forms, and that such
information is accumulated and communicated to our management, including our Co-Chief Executive
Officers and Chief Financial Officer, as appropriate, to allow timely decisions regarding required
disclosures.
Our management, under the supervision and with the participation of our Co-Chief Executive
Officers and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and
procedures as of December 31, 2023. Based on such evaluation the Co-Chief Executive Officers and
Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of
December 31, 2023.
(b) Management's Annual Report on Internal Controls Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over
financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control
over financial reporting is a process designed by, or under the supervision of, our Company’s Co-Chief
Executive Officers and Chief Financial Officer, and effected by our board of directors, management and
other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with IFRS Accounting Standards
as issued by the IASB and includes those policies and procedures that (1) pertain to the maintenance of
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records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with IFRS Accounting Standards, and that
receipts and expenditures of the Company are being made only in accordance with authorizations of
management and directors of the Company; and (3) provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could
have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree of
compliance with the policies and procedures may deteriorate. Our management assessed the
effectiveness of our internal control over financial reporting as of December 31, 2023. This assessment
was performed under the direction and supervision of our Co-Chief Executive Officers and our Chief
Financial Officer, and based on criteria established in “Internal Control - Integrated Framework (2013)”
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on
such assessment, management, including our Co-Chief Executive Officers and our Chief Financial
Officer, has concluded that our internal control over financial reporting was effective as of December 31,
2023.
(c) Attestation Report of the Registered Independent Public Accounting Firm

Refer to the report of PricewaterhouseCoopers AG, Switzerland, an independent registered
public accounting firm, see “Item 18. Financial Statements—Report of independent registered public
accounting firm.”
(d) Changes in Internal Control Over Financial Reporting

Except for the remediation of a material weakness previously disclosed in our December 31,
2022 Form 20-F, and described below, there were no changes in our internal control over financial
reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under Exchange Act) that occurred
during the the fiscal year ended December 31, 2023 covered by this annual report on Form 20-F that
have materially affected, or is reasonably likely to materially affect, our internal control over financial
reporting.
Remediation of Prior Material Weakness

A material weakness is a deficiency, or a combination of deficiencies, in internal control over
financial reporting, such that there is a reasonable possibility that a material misstatement of the
Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
The material weakness previously disclosed in our December 31, 2022 Form 20-F was that we
had an ineffective design of controls to address segregation of certain accounting duties within our
financial reporting function, including the absence of functionality within our legacy ERP systems to
require the review of journal entries, and certain financial statement account reconciliations for which a
formal review process had not been established.
In response to the material weakness management performed remediation measures to
remediate the material weakness, including (i) the implementation of a new ERP system; (ii)
enhancement of our processes and design of controls over segregation of duties and the review of
journal entries and account reconciliations, including the introduction of approval workflows within our
ERP; (iii) acquisition of software applications and tools specific to account reconciliations or the
identification and responding to risks related to segregation of duties and (iv) the engagement of external
advisors to assist in the implementation of processes and controls to better identify and manage
segregation of duties risks.
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As of December 31, 2023, based on an assessment performed by our management on the

performance of the remediation measures (specified above), we concluded that the material weakness
has been remediated.
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

Audit Committee
Our board of directors has determined that Dennis Durkin and Alex Perez are both considered
an “audit committee financial expert” as such term is defined in the rules of the SEC. Our board of
directors has also determined that each of Dennis Durkin and Alex Perez satisfies the “independence”
requirements set forth in Rule 10A-3 of the Exchange Act and NYSE listing standards. We have a fully
independent audit committee.
For information relating to the qualifications and experience of each audit committee member,
see “Item 6. Directors, Senior Management and Employees,” incorporated herein by reference.
ITEM 16B. CODE OF ETHICS

Code of Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics (the “Code of Conduct”) that is
applicable to all of our employees, executive officers and directors. The Code of Conduct is available to
the general public on our website https://investors.on.com under Governance (Governance Documents -
On Code of Conduct). The information on our website is not incorporated into this Annual Report. Our
board of directors is responsible for overseeing the Code of Conduct and is required to approve any
waivers of the Code of Conduct.
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

For the year ended December 31, 2023 and 2022, PricewaterhouseCoopers AG (PwC) was the
Company's auditor for the IFRS Accounting Standards and statutory accounts.
The following table sets forth the amount of fees, by type of service category, charged by PwC
to our Company during fiscal 2023 and fiscal 2022.
Fiscal year ended
December 31,
(CHF in millions) 2023 2022
Audit fees(1) 1.4 1.2

(2)
Tax fees 0.1 0.1
(3)
All other fees 0.1 0.3
Total 1.6 1.6
(1) “Audit fees” means the aggregate fees billed in each of the fiscal years for professional
services rendered by PwC for the audit of our annual financial statements and review of our
interim financial statements.
(2) “Tax fees” means the aggregate fees billed in each of the fiscal years for professional
services rendered by PwC for tax compliance and tax advice.
(3) “All other fees” includes the aggregate fees billed in each of the fiscal years for non-audit
services rendered which were not listed above.
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Audit Committee Pre-Approval Policies and Procedures

In accordance with the requirements of the U.S. Sarbanes-Oxley Act of 2002 and rules issued by
the SEC, our audit committee reviews and pre-approves all audit services and permissible non-audit
services provided to us that are performed by PwC, other than de minimis non-audit services which are
approved by the audit committee prior to the completion of the audit. All of the services related to our
Company provided by PwC listed above have been pre-approved by the audit committee.
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Not applicable.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED

PURCHASERS
During the year ended December 31, 2023, no purchases of our equity securities were made by
or on behalf of On Holding AG or any affiliated purchaser.
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

Not applicable.
ITEM 16G. CORPORATE GOVERNANCE

Corporate Governance Practices
As a “foreign private issuer,” as defined by the SEC, we are permitted to follow home country
corporate governance practices, instead of certain corporate governance standards required by the
NYSE for U.S. companies. Accordingly, we follow Swiss corporate governance rules in lieu of certain of
the corporate governance requirements of the NYSE. The significant differences between our Swiss
corporate governance rules and the corporate governance requirements of the NYSE are set forth
below:
• Exemption from the requirement that a majority of the board of directors be comprised of
independent directors and that there be regularly scheduled meetings with only the
independent directors present. Swiss law does not have such a requirement.
• Exemption from the requirements that the compensation committee and the nomination and
corporate governance committee be comprised of independent directors. Swiss law does
not have such requirements.
• Exemption from quorum requirements applicable to meetings of shareholders. Swiss law
does not require such quorum requirements.
• Exemption from the requirement that independent directors meet at regularly scheduled
executive sessions. Swiss law does not have such a requirement.
• Exemption from the requirement that listed companies adopt and disclose corporate
governance guidelines that cover certain minimum specified subjects related to director
qualifications and responsibilities. Swiss law does not require the adoption or disclosure of
such guidelines.
• Exemption from the requirement to disclose within four business days of any determination
to grant a waiver of the Code of Conduct to directors and executive officers. Although we
will require approval by our board of directors for any such waiver, we may choose not to
disclose the waiver in the manner set forth in the NYSE listing standards.
• Exemption from the requirement to obtain shareholder approval for certain issuances of
securities, including shareholder approval of share option plans. Our amended and restated
articles of association provide that our board of directors is authorized, in certain instances,
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to issue a certain number of Class A ordinary shares without re-approval by our

shareholders, as well as Class B voting rights shares to members of our extended founder
team under employee participation plans.
ITEM 16H. MINE SAFETY DISCLOSURE

Not applicable.
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.
ITEM 16J. INSIDER TRADING POLICIES

Not applicable.
ITEM 16K. CYBERSECURITY
Risk management and strategy

The Company has cybersecurity risk management processes in place to identify, assess, and
manage material risks from cybersecurity threats to protect the confidentiality, integrity, and availability
of our IT systems and information. The Company’s approach to risk assessment and management also
includes an established process of due diligence for third-party suppliers, assessing potential privacy
and security risks occurring both before and after integration. Our cybersecurity risk management
process is part of the Company’s overall enterprise risk management ("ERM") process.
We engaged an independent IT auditor to perform a cybersecurity assessment based on the
National Institute of Standards and Technology cybersecurity framework. We currently engage IT
consultants to perform independent IT security assessments of our key IT assets inclusive of web
application and network infrastructure. The Company also performs continuous bug bounty programs
focused on identifying and rectifying vulnerabilities on our key applications and has a centralized identity
and provisioning management system and employees are assessed and trained on a monthly basis via
the performance of phishing simulations to provide “experiential learning” on how to recognize phishing
attempt. We also manage employee devices through a centralized Mobile Device Management ("MDM"),
allowing us to secure and enforce policies within our network. MDM solutions also allow the Company to
remotely configure settings, deploy apps, enforce security protocols, and monitor device usage.
Employee devices are also protected with Endpoint Detection and Response (EDR), designed to detect
and respond to malicious activities and threats. Additionally, our engineering teams leverage advanced
security tools to identify and address potential security issues during the build and deployment process.
While On maintains cybersecurity insurance, the costs related to cybersecurity threats or
disruptions may not be fully insured. For additional information regarding whether any risks from
cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially
affected or are reasonably likely to materially affect our Company, including our business strategy,
results of operations, or financial condition, please refer to Item 3.D, "Risk Factors, "in this Annual
Report on Form 20-F, including the risk factor entitled “A security breach, including a cybersecurity
incident or other disruption to our IT systems could result in adverse effects on the confidentiality,
integrity, or availability of our IT systems or any information residing therein, including the loss, theft,
misuse, unauthorized disclosure, or unauthorized access of customer, supplier, or sensitive company
information or could disrupt our operations. Such cybersecurity threats could damage our relationships
with customers, suppliers or employees, expose us to litigation or regulatory proceedings, or harm our
reputation, any of which could materially adversely affect our business strategy, financial condition or
results of operations.”
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Governance
Our board of directors is responsible for overseeing our ERM activities in general, including
material risks related to cybersecurity threats. The full Board receives an update [from senior
management] on the Company’s ERM process and the risk trends related to cybersecurity at least
annually. To help ensure effective oversight, beginning in 2024, the board of directors will receive reports
on information security and cybersecurity from the Chief Technology Officer ("CTO") at least four times a
year.
On's CTO is responsible for the assessment and management of material risks from
cybersecurity threats, sits on the Company's management board and reports directly to our Co-CEO,
Martin Hoffmann. The Company's information security function, which reports directly to our CTO,
performs ongoing assessments to identify and mitigate cybersecurity threats. Our information security
function has the required expertise with cybersecurity, as demonstrated by prior work experience,
possession of a cybersecurity certification or degree, or other cybersecurity experience. We also monitor
the prevention, detection, and remediation of cybersecurity incidents and work closely with the
Company's ERM team to ensure a consistent risk management process. This includes periodic reporting
to the management board, board of directors, and to the Company's Group Reporting team when any
cybersecurity incidents identified are deemed material.
PART III
We have elected to provide financial statements and related information pursuant to Item 18.

The consolidated financial statements and the related notes required by Item 18 are in included
in this Annual Report on Form 20-F, beginning on page F-1. The report of PricewaterhouseCoopers AG
(PCAOB ID: 1358), the Company's independent registered accounting firm with respect to the
referenced financial statements is included on page F-2.
ITEM 19. EXHIBITS
Schedule/ File
Exhibit Description Form Number Exhibit File Date
Amended and Restated Articles of May 26,
1.1 Association of On Holding AG* Form 6-K 001-40795 99.1 2023
2.1 Description of Securities**
Shareholders’ Agreement by and among
On Holding AG and the extended founder September
4.1 team of On Holding AG* Form F-1/A 333-258998 10.1 7, 2021
On Holding AG Long Term Incentive Plan August 23,
4.2 2020-2023* Form F-1 333-258998 10.2 2021
Amendment 2021 to the Long Term August 23,
4.3 Incentive Plan 2020-2023* Form F-1 333-258998 10.3 2021
On Holding AG Long Term Incentive Plan August 23,
4.4 2018* Form F-1 333-258998 10.4 2021
Amendment 2019 to On Holding AG Long August 23,
4.5 Term Incentive Plan 2018* Form F-1 333-258998 10.5 2021
Amendment 2021 to On Holding AG Long August 23,
4.6 Term Incentive Plan 2018* Form F-1 333-258998 10.6 2021
Table of Contents
Second Amendment 2021 to the On

Holding AG Long Term Incentive Plan August 23,
4.7 2018* Form F-1 333-258998 10.7 2021
On Holding AG Level Two Participation August 23,
4.8 Plan* Form F-1 333-258998 10.8 2021
Amendment 2021 to Level Two August 23,
4.9 Participation Plan* Form F-1 333-258998 10.9 2021
Second Amendment 2021 to Level Two August 23,
4.10 Participation Plan* Form F-1 333-258998 10.10 2021
On Holding AG On Employee Participation August 23,
4.11 Program 2018* Form F-1 333-258998 10.11 2021
Amendment 2019 to On Employee August 23,
4.12 Participation Program 2018* Form F-1 333-258998 10.12 2021
Amendment 2021 to the On Employee August 23,
4.13 Participation Program 2018* Form F-1 333-258998 10.13 2021
Form of On Holding AG Long Term September
4.14 Incentive Plan 2021* Form F-1/A 333-258998 10.14 7, 2021
August 23,
On Holding AG Founders’ Grants Plan*
4.15 Form F-1 333-258998 10.15 2021
On Holding AG Tax Recognition Grants December
4.16 Plan* Form S-8 333-268853 99.1 16, 2022
August 23,
Form of Indemnification Agreement*
4.17 Form F-1 333-258998 10.16 2021
Amendment 2023 to On Holding AG Long March 21,
4.18 Term Incentive Plan 2021* Form 20-F 001-40795 4.18 2023
Credit Facility Agreement, dated as of July
7, 2023, by and among On Holding AG, as
guarantor, On AG, as borrower and
guarantor, and On Inc., as guarantor, and
UBS Switzerland AG, as lead arranger,
bookrunner, agent, security agent and
lender, and the other lenders party
4.19 thereto**
8.1 List of subsidiaries**
Certification of Marc Maurer, Co-Chief
Executive Officer of On Holding AG,
pursuant to Section 302 of the Sarbanes-
12.1 Oxley Act of 2002**
Certification of Martin Hoffmann, Chief
Financial Officer and Co-Chief Executive
Officer of On Holding AG, pursuant to
Section 302 of the Sarbanes-Oxley Act of
12.2 2002**
Certifications of Co-Chief Executive
Officers and Chief Financial Officer of On
Holding AG Pursuant to Section 18 U.S.C.
Section 1350, as adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of
13.1 2002**
15.1 Consent of PricewaterhouseCoopers AG**
Table of Contents
On Holding AG Financial Statement

97.1 Compensation Recoupment Policy**
101.INS Inline XBRL Instance Document

Inline XBRL Taxonomy Extension Schema
101.SCH Document
Inline XBRL Taxonomy Extension
101.CAL Calculation Linkbase Document
Inline XBRL Taxonomy Extension Label
101.LAB Linkbase Document
101.PRE Presentation Linkbase Document
101.DEF Definition Linkbase Document
Cover Page Interactive Data File
(embedded within the Inline XBRL
104 document)
* Incorporated by reference
** Filed herewith
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has
duly caused and authorized the undersigned to sign this annual report on Form 20-F filed on its behalf.
On Holding AG
Dated: March 12, 2024
By: /s/ Marc Maurer

Name: Marc Maurer
Title: Co-Chief Executive Officer
By: /s/ Martin Hoffmann

Name: Martin Hoffmann
Chief Financial Officer and Co-Chief Executive Officer
Index to financial statements
Audited consolidated financial statements - On Holding AG
Report of the statutory auditor on the consolidated financial statements of On Holding AG for 2023 F-2
Consolidated statements of income / (loss) for the years ended December 31, 2023, 2022 and 2021 F-4
Consolidated statements of comprehensive income / (loss) for the years ended December 31, 2023, 2022 and 2021 F-5
Consolidated balance sheets as of December 31, 2023 and 2022 F-6
Consolidated statements of cash flows for the years ended December 31, 2023, 2022 and 2021 F-7
Consolidated statements of changes in equity for the years ended December 31, 2023, 2022, and 2021 F-8
Notes to the consolidated financial statements F-9
F-1
Report of the statutory auditor
to the General Meeting of On Holding AG
Zurich
Report on the audit of the consolidated financial statements
Opinion
We have audited the consolidated financial statements of On Holding AG and its subsidiaries (the Group), which com-
prise the consolidated statement of income / (loss) and consolidated statement of comprehensive income / (loss) for the
year ended December 31, 2023, the consolidated balance sheet as at December 31, 2023, the consolidated statement
of cash flows and consolidated statement of changes in equity for the year then ended, and notes to the consolidated
financial statements, including material accounting policy information.
In our opinion, the consolidated financial statements (pages F4 to F57) give a true and fair view of the consolidated fi-
nancial position of the Group as at December 31, 2023 and its consolidated financial performance and its consolidated
cash flows for the year then ended in accordance with IFRS Accounting Standards and comply with Swiss law.
Basis for opinion

We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISAs) and Swiss Standards
on Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the 'Auditor's
responsibilities for the audit of the consolidated financial statements' section of our report. We are independent of the
Group in accordance with the provisions of Swiss law and the requirements of the Swiss audit profession, as well as the
International Code of Ethics for Professional Accountants (including International Independence Standards) issued by
the International Ethics Standards Board for Accountants (IESBA Code), and we have fulfilled our other ethical responsi-
bilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our audit approach
Overview Overall Group materiality: CHF 12.5 million
We identified three wholly owned Group entities where we performed a full

scope audit. Our audit scope addressed 80% of the Group's revenue.
Materiality
As key audit matter the following area of focus has been identified:
Accounting for lease contracts
Audit scope
Key audit
matters
PricewaterhouseCoopers AG, Birchstrasse 160, Postfach, 8050 Zurich, Switzerland

Telefon: +41 58 792 44 oo, www.pwc.ch
PricewaterhouseCoopers AG is a member of the global PricewaterhouseCoopers network of firms, each of which is a separate and independent legal entity.
Materiality
The scope of our audit was influenced by our application of materiality. Our audit opinion aims to provide reasonable
assurance that the consolidated financial statements are free from material misstatement. Misstatements may arise due
to fraud or error. They are considered material if, individually or in aggregate, they could reasonably be expected to influ-
ence the economic decisions of users taken an the basis of the consolidated financial statements.
Based an our professional judgement, we determined certain quantitative thresholds for materiality, including the overall
Group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with
qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit
procedures and to evaluate the effect of misstatements, both individually and in aggregate, an the consolidated financial
statements as a whole.
Overall Group materiality CHF 12.5 million
Benchmark applied Total revenue
Rationale for the materiality bench- We chose revenue as the benchmark as, in our view, it is the most appropriate
mark applied measure considering the Group's current year's results and one of the
measures against which the Group's performance is typically measured in the
stage of being established. lt is further a generally accepted benchmark.
We agreed with the Audit Committee that we would report to them misstatements above CHF 0.625 million identified
during our audit as well as any misstatements below that amount which, in our view, warranted reporting for qualitative
reasons.
Audit scope
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion an the consoli-
dated financial statements as a whole, taking into account the structure of the Group, the accounting processes and con-
trols, and the industry in which the Group operates.
The Group consists of 26 legal entities in 12 different countries. We identified three wholly owned Group entities in two
countries for which, in our opinion, a full scope audit was necessary. All those full scope audits were performed by the
group audit team. The group audit team has additionally performed centralised analytical risk procedures over all group
entities due to their limited size and risk characteristics.
Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
consolidated financial statements of the current period. These matters were addressed in the context of our audit of the
consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion an these matters.
Accounting for lease contracts
Key audit matter How our audit addressed the key audit matter
The Group's right-of-use assets and lease liabilities amount Our audit procedures, amongst others, included the follow-
to CHF 214.0 million and CHF 229.0 million respectively as ing:
of December 31, 2023.
• We assessed the appropriateness of the lease manage-
ment system by evaluating management's policies, pro-
Management uses judgement to determine the lease term cesses and controls put in place to identify, capture and ac-
for some lease contracts which include extension or termi- count for lease contracts by obtaining an understanding of
nation options and to determine the incremental borrowing the system through discussion with management.
rate. The assessment of whether the Company is reasona-
bly certain to exercise such options impacts the lease term • We evaluated the completeness of the leases identified by
management by comparing the right-of-use asset popula-
which significantly affects the amount of right-of-use assets
tion within the lease management system to the population
and lease liabilities recognized. A reassessment only hap- in the accounting system and by reviewing the board
pens when a significant event or change in circumstance minutes and significant contracts.
_1116 3 On Holding AG 1 Report of the statutory auditor to the General Meeting

pwc
occurs that is within the control of the Company and affects • We examined on a sample basis the supporting documen-
whether it is reasonably certain to exercise an option. tation of repairs and maintenance accounts to determine
whether they are appropriately expensed or should have
been recognized as lease contracts.
The principal considerations for our determination that the
Group's accounting for lease contracts is a key audit matter • For a sample of newly concluded lease contracts, we:
are (i) the significant judgment applied by management in — inspected the terms and conditions of the underlying con-
assessing the potential outcomes and related accounting tracts and evaluated management's identification of the rele-
impacts associated with lease contracts and (ii) a high de- vant lease terms;
gree of auditor judgment and effort in performing proce- — assessed whether management's judgement about the po-
tential outcomes are appropriate, including the assessment
dures and evaluating management's significant assump- of fixed and variable lease payments and assessed whether
tions related to the determination of the lease terms and an those parameters have appropriately been included in the
appropriate incremental borrowing rate. lease management system;
— assessed whether the interest rate implicit in the lease
Refer to note 3.4 — Right-of-use assets and note 4.3 — contract has been appropriately reflected in the lease man-
agement system;
Financial liabilities in the consolidated financial statements.
— recalculated the lease liabilities, right-of-use assets, fi-
nance costs and depreciation based on the data included in
the lease management system; and
— assessed the appropriate reflection of impacts from lease
modifications and reassessments by discussions with man-
agement and consultation with the PwC IFRS technical of-
fice.
Other information
The Board of Directors is responsible for the other information. The other information comprises the information included
in the annual report, but does not include the financial statements, the consolidated financial statements, the remunera-
tion report and our auditor's reports thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial state-
ments or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Board of Directors' responsibilities for the consolidated financial statements

The Board of Directors is responsible for the preparation of consolidated financial statements that give a true and fair
view in accordance with IFRS Accounting Standards and the provisions of Swiss law, and for such internal control as the
Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group's ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
Swiss law, ISAs and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influ-
ence the economic decisions of users taken on the basis of these consolidated financial statements.
—OL 4 On Holding AG 1 Report of the statutory auditor to the General Meeting

pwc
As part of an audit in accordance with Swiss law, ISAs and SA-CH, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrep-
resentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropri-
ate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal
control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and re-
lated disclosures made.
• Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty ex-
ists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evi-
dence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclo-
sures, and whether the consolidated financial statements represent the underlying transactions and events in a man-
ner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction,
supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
We also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant
ethical requirements regarding independence, and communicate with them regarding all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats
or safeguards applied.
From the matters communicated with the Board of Directors or its relevant committee, we determine those matters that
were of most significance in the audit of the consolidated financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
5 On Holding AG 1 Report of the statutory auditor to the General Meeting

pwc
Report an other legal and regulatory requirements
In accordance with article 728a para. 1 item 3 CO and PS-CH 890, we confirm the existence of an internal control sys-
tem that has been designed, pursuant to the instructions of the Board of Directors, for the preparation of the consoli-
dated financial statements.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Patrick Balkanyi Samuel Haering

Licensed audit expert Licensed audit ex
Auditor in charge
Zurich, March 12, 2024

pwc
Consolidated statements of income / (loss)
(CHF in millions) Notes 2023 2022 2021
Net sales 2.1 1,792.1 1,222.1 724.6

Cost of sales (724.8) (537.2) (294.3)
Gross profit 1,067.2 684.9 430.3
Selling, general and administrative expenses 2.3 (887.0) (599.8) (571.4)
Operating result 180.2 85.1 (141.1)
Financial income 4.4 11.5 5.7 —
Financial expenses 4.4 (11.3) (6.4) (3.6)
Foreign exchange result 4.4 (111.4) (6.5) (14.9)
Income / (loss) before taxes 69.1 77.9 (159.6)
Income tax benefit / (expense) 6.4 10.5 (20.2) (10.6)
Net income / (loss) 79.6 57.7 (170.2)
Earnings per share 4.6
Basic EPS Class A (CHF) 0.25 0.18 (0.59)
Basic EPS Class B (CHF) 0.02 0.02 (0.06)
Diluted EPS Class A (CHF) 0.25 0.18 (0.59)

Diluted EPS Class B (CHF) 0.02 0.02 (0.06)
F-4
Consolidated statements of comprehensive
income / (loss)
Net income / (loss) 79.6 57.7 (170.2)

Net actuarial result from defined benefit plans 6.2 (3.4) 4.4 0.9
Taxes on net actuarial result from defined benefit plans 6.4 0.7 (0.9) (0.2)
Items that will not be reclassified to income statement (2.7) 3.5 0.7
Exchange differences (7.0) (0.1) (1.0)
Items that will be reclassified to income statement (7.0) (0.1) (1.0)
when specific conditions are met
Other comprehensive income / (loss), net of tax (9.7) 3.4 (0.3)
Total comprehensive income / (loss) 69.8 61.1 (170.5)
F-5
Consolidated balance sheets
(CHF in millions) Notes 12/31/2023 12/31/2022
Cash and cash equivalents 4.1 494.6 371.0

Trade receivables 3.1 204.8 174.6
Inventories 3.2 356.5 395.6
Other current financial assets 4.2 34.2 33.2
Other current operating assets 3.6 61.2 77.0
Current assets 1,151.3 1,051.5
Property, plant and equipment 3.3 93.6 77.2
Right-of-use assets 3.4 214.0 151.6
Intangible assets 3.5 64.6 70.3
Deferred tax assets 6.4 69.5 31.7
Non-current assets 441.7 330.9
Assets 1,593.0 1,382.4
Trade payables 65.1 111.0
Other current financial liabilities 4.3 53.4 31.2
Other current operating liabilities 3.6 156.4 81.7
Current provisions 6.3 7.1 5.0
Income tax liabilities 23.5 13.9
Current liabilities 305.6 242.7
Employee benefit obligations 6.2 2.2 6.3
Non-current provisions 6.3 10.0 7.2
Other non-current financial liabilities 4.3 190.3 138.8
Deferred tax liabilities 6.4 10.5 17.9
Non-current liabilities 212.9 170.2
Share capital 4.5 33.5 33.5
Treasury shares 4.5 (26.7) (26.1)
Capital reserves 4.7 1,140.8 1,105.1
Other reserves 4.7 (9.8) —
Accumulated losses (63.3) (142.9)
Equity 1,074.5 969.5
Equity and liabilities 1,593.0 1,382.4
F-6
Consolidated statements of cash flows
Net income / (loss) 79.6 57.7 (170.2)

Share-based compensation 6.1 27.3 38.3 192.4
Employee benefit expenses 6.2 (7.5) 4.8 1.1
Depreciation and amortization 3.3,3.4,3.5 64.9 46.4 31.4
Loss / (gain) on disposal of assets 0.6 0.9 —
Interest income and expenses (4.5) (0.8) 2.8
Net exchange differences 102.9 (8.3) 15.2
Income taxes 6.4 (10.5) 20.2 10.6
Change in provisions 6.3 4.8 (7.4) 4.4
Change in working capital (101.2) (285.8) (74.4)
Trade receivables (46.9) (78.6) (47.0)
Inventories (10.0) (273.0) (31.8)
Trade payables (44.3) 65.8 4.3
Change in other current assets / liabilities 3.6 93.4 (67.6) 8.1
Interest received 11.0 5.6 —
Income taxes paid (28.6) (31.0) (4.4)
Cash inflow / (outflow) from operating activities 232.1 (227.0) 16.9
Purchase of tangible assets 3.3 (42.8) (60.3) (24.6)

Purchase of intangible assets 3.5 (4.4) (22.7) (11.6)
Payment of contingent considerations — — (0.2)
Cash (outflow) from investing activities (47.1) (82.9) (36.4)
Payments of lease liabilities 4.3 (25.5) (15.4) (13.3)

Proceeds from issue of shares 4.5 — — 0.1
Net proceeds from the IPO 4.5 — — 618.2
Equity transaction costs 4.5 — — (6.8)
Proceeds on sale of treasury shares related to share- 4.5 10.1 26.4 0.5
based compensation
Interest paid (6.5) (4.7) (2.8)
Cash inflow / (outflow) from financing activities (21.8) 6.3 595.9
Change in net cash and cash equivalents 4.1 163.2 (303.6) 576.4
Net cash and cash equivalents at January 1 371.0 653.1 90.6
Net impact of foreign exchange rate differences (39.6) 21.5 (13.9)
Net cash and cash equivalents at December 31 494.6 371.0 653.1
F-7
Consolidated statements of changes in equity
Accumulated
Share Treasury Capital Other income / Total
(CHF in millions) capital shares reserves reserves (losses) equity
Balance at January 1, 2021 2.2 — 276.4 (3.1) (30.4) 245.1

Net loss — — — — (170.2) (170.2)
Other comprehensive loss — — — (0.3) — (0.3)
Comprehensive loss 2021 — — — (0.3) (170.2) (170.5)
Capital increase 3.0 — 615.3 — — 618.3
Equity transaction costs — — (6.8) — — (6.8)
Tax impact on equity transaction
costs — — 1.3 — — 1.3
Share-based compensation — — 183.2 — — 183.2
Purchase of treasury shares — (22.8) — — — (22.8)
Sale of treasury shares — 0.2 0.5 — — 0.7
Share capital reorganization 28.3 (2.5) (25.8) — — —
Balance at December 31, 2021 33.5 (25.0) 1,044.0 (3.4) (200.6) 848.4
Net income — — — — 57.7 57.7
Other comprehensive income — — — 3.4 — 3.4
Comprehensive income 2022 — — — 3.4 57.7 61.1
Tax impact on equity transaction
costs — — (5.1) — — (5.1)
Balance at December 31, 2022 33.5 (26.1) 1,105.1 — (142.9) 969.5
Net income — — — — 79.6 79.6
Other comprehensive loss — — — (9.7) — (9.7)
Comprehensive income / (loss) — — — (9.7) 79.6 69.8
Tax impact on transactions with
treasury shares — — (1.9) — — (1.9)
Balance at December 31, 2023 33.5 (26.7) 1,140.8 (9.8) (63.3) 1,074.5
F-8
Notes to the consolidated financial statements
1 Basis for preparation
1.1 Corporate information

On is engaged in developing and distributing innovative premium performance sports products, sold worldwide
through independent retailers and global distributors, an own online presence, and its own high-end stores.
On is a publicly traded company on the New York Stock Exchange, trading under the ticker symbol "NYSE:
ONON".
These consolidated financial statements (“the financials”) have been prepared in accordance with International
Financial Reporting Standards ("IFRS") and interpretations developed by the IFRS Interpretations Committee (IFRIC
Interpretations), or its predecessor body, the Standing Interpretations Committee (SIC Interpretations), together “IFRS
Accounting Standards”, as issued by the International Accounting Standards Board (IASB), and present the financial
position and the results of operations of On Holding AG, as the ultimate parent company, and its subsidiaries. On
Holding AG is a limited company incorporated in accordance with Swiss law under a private statute and is domiciled at
Förrlibuckstrasse 190, Zurich, Switzerland.
These annual consolidated financial statements for the year ended December 31, 2023 were authorized for issue
by the board of directors of the Company on March 12, 2024.
1.2 About the financials

The financials of On
• Have been prepared in accordance with IFRS Accounting Standards, as issued by the IASB.
• Include the values of On Holding AG and its domestic and foreign subsidiaries as at December 31, 2023
over which On Holding AG exercised direct or indirect control.
• The fiscal year corresponds to the calendar year.
• Present note disclosures related to the consolidated balance sheets as at December 31 and consolidated
statements of income / (loss), comprehensive income / (loss), cash flows, and changes in equity for the
respective year.
• Are published in Swiss Francs (CHF), the presentation currency of On Holding AG, rounded to millions
(“m”), unless otherwise stated. Due to rounding, figures in the financials may not add up exactly to the sum
given.
• Use the historical cost convention except for items that are required to be accounted for at fair value.
• Classify assets as current if they are expected to be recovered within twelve months from the reporting
date.
• Classify liabilities as current if they are expected to be settled within twelve months from the reporting date.
• Present the applicable accounting policy within the respective note disclosures.
F-9
1.3 Oniverse
Equity interest
Entity Domicile 12/31/2023 12/31/2022
On Holding AG Zurich, CH
On AG Zurich, CH 100% 100%
On Brazil Ltda. Sao Paulo, BR 100% 100%
On Cloud Service GmbH Berlin, DE 100% 100%
On Clouds GmbH Zurich, CH 100% 100%
On Clouds Inc. Dover, DE, USA 100% 100%
On Europe AG Zurich, CH 100% 100%
On Experience 1 LLC Dover, DE, USA 100% 100%
On Experience 2 LLC Wilmington, DE, USA 100% 100%
On Experience 6 LLC Wilmington, DE, USA 100% —%
On Hong Kong Limited Hong Kong, SAR of CN 100% 100%
On Inc. Portland, OR, USA 100% 100%
On Italy S.r.l. Milan, IT 100% 100%
On Japan K.K. Yokohama, JP 100% 100%
On Korea Ltd. Seoul, Korea 100% —%
On Oceania Pty Ltd. Melbourne, AU 100% 100%
On Running Canada Inc. Vancouver, CA 100% 100%
On Running Sports Products (Shanghai) Company Ltd. Shanghai, CN 100% 100%
On Running UK Ltd. London, UK 100% 100%
On Vietnam Co. Ltd. Ho Chi Minh City, VN 100% 100%
Brunner Mettler GmbH Zurich, CH 100% 100%
Accounting policies “Oniverse” represents the legal group structure of the On Group. Entities are fully
consolidated from the date on which control is transferred to On Holding AG, the parent
company of the group. Control is achieved when On is exposed, or has rights, to variable
returns from its involvement with the investee and has the ability to affect those returns
through its power over the investee.
For the consolidated entities, all assets, liabilities, income, and expenses are included in
the financial statements. All intercompany balances and transactions (including unrealized
profits on inventories) are fully eliminated in the process of consolidation.
F-10
1.4 New and amended standards and interpretations
On has adopted the following amendments for fiscal year 2023. The amendments did not have a material impact
on the consolidated financial statements.
Description Standard Reference IASB Effective Date
Presentation of Financial Statements, Amendments to IAS 1 January 1, 2023

Disclosure of Accounting Policies
Accounting Policies, Changes in Amendment to IAS 8 January 1, 2023
Accounting Estimates and Errors
Deferred Tax related to Assets and Amendments to IAS 12 January 1, 2023
Liabilities arising from a Single
Transaction
Insurance Contracts IFRS 17 January 1, 2023
International Tax Reform—Pillar Two Amendments to IAS 12 May 23, 2023
Model Rules(1)
In October 2021, OECD published key parameters and rules on a minimum tax rate of 15% (Pillar Two) for
multinational enterprises with revenue of more than EUR 750 million, such as our business. Many jurisdictions in which
we are subject to income taxes, global minimum tax rules have been enacted, or substantively enacted, which can
impose detailed reporting obligations and increase compliance and systems-related costs on our businesses. In
Switzerland, where the Group is headquartered, the enacted legislation is currently limited to the introduction of a
Qualified Domestic Top-up Tax effective 1 January 2024.
We have applied the temporary exception issued by the IASB in May 2023 from the accounting requirements for
deferred taxes in IAS 12. Accordingly, we neither recognizes nor discloses information about deferred tax assets and
liabilities related to Pillar Two income taxes.
As an integral part of the rule set, the OECD has published transitional Country-by-Country Report (CbCR) Safe
Harbor rules, with the purpose to remove the obligation of calculating the Pillar Two effective tax rate for operations in
lower-risk jurisdictions during the initial years when the rules take effect. In applying the transitional CBCR Safe Harbor
rules on the fiscal year end 2023 consolidated financial statements, the majority of the jurisdictions are expected to
qualify for the transitional CbCR Safe Harbor rules.
Further, at the date of authorization of these consolidated financial statements, On has not applied the following
new and revised IFRS Accounting Standards that have been issued by the IASB but are not yet effective:
Description Standard Reference IASB Effective Date
Classification of Liabilities as Current Amendments to IAS 1 January 1, 2024

or Non-current
Non-current Liabilities with Covenants Amendments to IAS 1 January 1, 2024
Supplier Finance Arrangements Amendments to IAS 7 and IFRS 7 January 1, 2024
Sale and Leaseback Transactions Amendment to IFRS 16 January 1, 2024
Lack of Exchangeability Amendments to IAS 21 January 1, 2025
On does not expect that the adoption of the standards listed above will have a material impact on the financials of On in
the current or future reporting periods.
1.5 Significant accounting judgments, estimates, and assumptions
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The preparation of financials in conformity with IFRS Accounting Standards requires management to make
judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and
related disclosures. This includes judgments, estimates, and assumptions in the ordinary course of business as well as
non-operating events. Uncertainty about these judgments, assumptions, and estimates could result in outcomes that
require a material adjustment to the carrying amount of assets or liabilities affected in future periods. The judgments,
estimates, and assumptions are continuously evaluated and are based on experience and other factors, including
expectations of future events that are believed to be reasonable. Actual results may differ from these judgments,
estimates, and assumptions. The main judgments, estimates, and assumptions with a significant risk of resulting in a
material adjustment are described in the following notes:
• 3.4 Right-of-use assets
• 3.5 Intangible assets
• 6.1 Share-based compensation
• 6.2 Employee benefit obligations
• 6.3 Provisions
• 6.4 Income taxes
2 Operational performance
2.1 Net sales

Net sales by sales channels:
Wholesale 1,120.3 777.0 448.8

Direct-to-Consumer 671.8 445.1 275.8
Net sales 1,792.1 1,222.1 724.6
Net sales by product groups:

Shoes 1,711.4 1,167.5 683.3

Apparel 68.9 47.3 36.3
Accessories 11.8 7.4 5.0
Net sales 1,792.1 1,222.1 724.6
On generates net sales primarily from the sale of premium performance shoes, apparel, and accessories. On has
two sales channels being Wholesale (WHS) and Direct-to-Consumer (DTC). The WHS sales channel involves larger
volumetric sales to wholesale customers (e.g. large retailers or retail associations) and international distributors (in
markets where On does not have local sales teams) and which have the intention of re-selling the goods. The DTC sales
channel includes sales to end customers directly through On’s e-commerce platform as well as through own retail
stores.
Net sales by geographic regions (based on location of customers):
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Europe, Middle East and Africa 488.7 378.1 264.3

thereof Switzerland 46.0 51.5 55.1
Americas 1,162.2 763.8 417.6
thereof the United States 1,082.1 718.5 396.3
Asia-Pacific 141.1 80.2 42.7
Net sales 1,792.1 1,222.1 724.6
Due to its fragmented customer base, there is no single customer who accounts for more than 10% of total net
sales. For details on assets and liabilities related to contracts with customers refer to 3.1 Trade receivables and 3.6
Other current operating assets and liabilities, respectively. Trade receivables as shown in the balance sheet relate to the
sale of products and other revenue.
As announced on Form 6-k filed with the U.S. Securities and Exchange Commission on May 2, 2023, effective in
the first quarter of 2023, the Company updated its reporting of Net Sales by geography. Specifically, “Rest of World”,
which represented Middle East, Africa and Latin America, is no longer being reported as a geographic location. Instead,
Middle East and Africa is now combined with Europe and called Europe, Middle East & Africa (“EMEA”), and Latin
America is now part of the new geographic location called Americas (replacing North America as a geographic location).
The new reporting of net sales by geography has no impact on previously reported consolidated historical total
net sales or financial results. The new reporting of net sales by geography includes a reallocation of CHF 49.1 million
and CHF 12.0 million from Rest of World, for the year ended December 31, 2022 and December 31 2021, respectively,
to EMEA in the amount of CHF 23.8 million and CHF 3.9 million, and to Americas in the amount of CHF 25.3 million and
CHF 8.1 million, for the year ended December 31, 2022, and December 31, 2021, respectively. The below table includes
Net Sales by geography previously reported for the year ended December 31, 2022 and December 2021.
Net sales by geographic regions as previously reported:

Europe 354.3 260.4

thereof Switzerland 51.5 55.1
North America 738.5 409.5
Asia-Pacific 80.2 42.7
Rest of world 49.1 12.0
Net Sales 1,222.1 724.6
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Accounting policies Revenue is measured based on the consideration to which On expects to be entitled in a
contract with a customer and excludes amounts collected on behalf of third parties. On
recognizes revenue when it transfers control of a product to a customer.
Consideration promised in On’s contracts with customers is variable due to anticipated

reductions from sales returns, discounts and volume rebates. Significant estimate is not
required when recognizing revenue on contracts containing discounts and volume rebates
as the reduction in revenue is largely known by year end.
On sells innovative premium performance sports products through its Wholesales (WHS)
and Direct-to-Consumer (DTC) sales channels.
Sales within the WHS sales channel

For sales of goods to the wholesale market, revenue is recognized at a point in time when
control of the goods has transferred, being when the goods have been shipped or
delivered to the customer, in accordance with the incoterms. Following delivery, the
customer has full discretion over the manner of distribution and price to sell the goods, has
the primary responsibility when onselling the goods and bears the risks of obsolescence
and loss in relation to the goods. A receivable is recognized by On when the goods are
delivered to the customer as this represents the point in time at which the right to
consideration becomes unconditional, as only the passage of time is required before
payment is due. Payment terms for wholesale transactions depend on the country of sale
or agreement with the customer and payment is generally required within 30 to 90 days or
less of shipment to or receipt by the wholesale customer.
On has several consignment arrangements with wholesale customers whereby control of

the goods is retained by On. For such arrangements, revenue will only be recognized when
the goods have been sold by the wholesale customer to the final consumer. Certain
wholesale customers are part of wider associations which comprise of various independent
retailing groups. These associations have a dedicated entity to provide an administrative
service to the respective retailing groups within the association. The corresponding fee for
this administrative service is passed to On and is expensed to selling expenses.
Sales within the DTC sales channel

For sales of goods to end consumers and retail customers, revenue is recognized when
control of the goods has transferred, being upon shipment 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 at the point the customer purchases the goods.
Under On’s standard contract terms, retail customers have a right of return within 30 days.
At the point when the control of goods has transferred, a refund liability (other current
financial liabilities) and a corresponding adjustment to revenue is recognized for those
products expected to be returned. At the same time, On has a right to recover the product
when customers exercise their right of return so consequently recognizes a right to
returned goods asset (other current operating assets) and a corresponding adjustment to
cost of sales.
Relevant judgments Estimation is required to determine the expected amount On will be entitled to receive in
and accounting connection with contracts containing a right of return. Estimates of sales returns are based
estimates on (1) accumulated historical experience within the respective geographical markets, and
(2) specific identification of estimated sales returns not yet finalized with customers.
Actual returns in any future period are inherently uncertain and thus may differ from
estimates recorded. If actual or expected future returns were significantly greater or lower
than the refund liability established, a reduction or increase to net revenues would be
recorded in the period in which such determination was made.
On reviews and refines these estimates on an annual basis.
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2.2 Segment information
Operating segments are defined as components of an entity for which discrete financial information is available
and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource
allocation and performance assessment.
On’s CODM is the On Executive Team which consists of the three Co-Founders and the two Co-CEOs. The
CODM does not regularly review financial information for any individual component, such as sales channels, geographic
regions or product groups that would allow decisions to be made about allocation of resources or performance.
On operates as single-brand consumer products business and therefore has a single reportable segment. This is
primarily due to On’s business activities which focus on driving sales growth by increasing overall brand awareness and
market share. The key operating expenditures related to cost of sales, distribution, selling, marketing and general and
administrative expenses, are either not differentiated across individual components, or are managed to benefit the entire
On brand irrespective of the impact on the potential profitability of a particular component.
As discussed above in 2.1 Net sales, during the first quarter of 2023, the Company updated its reporting of
geographic areas. As such, the non-current assets by geography as at December 31, 2023 and December 31, 2022
reflects this new reporting structure. The new reporting of geography areas has no impact on previously reported
consolidated historical non-current assets. The new reporting of non-current assets by geographic area includes a
reallocation of CHF 1.3 million from Rest of World to Americas, for the twelve-month period ended December 31, 2022.
The following table reports the carrying amount of On’s non-current assets by geographic area:
(CHF in millions) 12/31/2023 12/31/2022
Europe, Middle East and Africa 270.4 246.8

thereof Switzerland 242.6 222.0
Americas 144.3 59.9
thereof the United States 142.2 58.5
Asia-Pacific 27.1 24.1
Non-current assets 441.7 330.9
2.3 Selling, general and administrative expenses

Distribution expenses (239.5) (151.0) (96.4)

Selling expenses (133.3) (85.5) (52.6)
Marketing expenses (195.8) (130.2) (100.5)
Share-based compensation (31.8) (33.8) (198.5)
General and administrative expenses (286.6) (199.3) (123.3)
Selling, general and administrative expenses (887.0) (599.8) (571.4)
In 2023, selling, general and administrative expenses include depreciation and amortization of non-current
assets in the amount of CHF 57.1 million (2022: CHF 40.0 million, 2021: CHF 28.7 million). In addition, depreciation
charges for production tools in the amount of CHF 7.7 million (2022: CHF 6.4 million, 2021: CHF 2.7 million) are reported
in cost of sales.
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Total personnel expenses, excluding any costs related to share-based compensation, amount to CHF
206.6 million in 2023, CHF 142.1 million in 2022 and CHF 87.3 million in 2021, respectively.
3 Operating assets and liabilities
3.1 Trade receivables

Trade receivables are generally due within a payment period of between 30 to 90 days. Due to the short-term
nature, their carrying amount is considered to be the same as their fair value.
(CHF in millions) 12/31/2023 12/31/2022
Not yet due 158.8 112.3

Past due 1 - 90 days 42.2 47.3
Past due 91 - 180 days 8.0 14.8
Past due 181 - 360 days 6.7 7.3
Past due > 361 days 2.4 2.0
Gross Carrying Amount 218.1 183.7
Individual loss allowance (12.6) (8.2)
Expected credit loss (0.7) (0.9)
Loss allowance (13.3) (9.1)
Trade receivables 204.8 174.6
Certain trade receivables have been pledged as collateral in relation to debt financing, refer to 5.4 Liquidity risk.
The recorded loss allowance for trade receivables reconciles as follows:
Individual loss allowance at January 1 8.2 2.0

Addition 6.1 6.3
Usage (1.1) —
Release (0.2) 0.0
Exchange differences (0.4) (0.1)
Individual loss allowance at December 31 12.6 8.2
Expected credit loss at January 1 0.9 0.6

Income statement (release) / addition for the year (0.2) 0.3
Expected credit loss at December 31 0.7 0.9
Refer to 5.3 Credit risk for additional information.
F-16
Accounting policies Trade receivables represent On’s right to an amount of consideration that is unconditional
and only a passage of time is required before payment of the consideration is due.
Trade receivables are initially recorded at original invoice amount and subsequently
measured at amortized cost less loss allowance calculated based on the expected credit
loss (ECL) model. On applies the simplified approach to measure credit losses, which uses
a lifetime expected loss allowance for trade receivables. This approach considers historical
credit loss experience as well as future expectations.
Trade receivables are written off when there is no reasonable expectation of recovery. The
charges to the income statement are included in selling, general and administrative
expenses.
Relevant judgments and Expected credit losses (ECL’s) on trade receivables are calculated based on historical loss
accounting estimates rates per region and adjusted by forward-looking quantitative and qualitative adjusted by
forward-looking quantitative and qualitative information such as the global economy
outlook (real GDP growth). In addition, appraisals and data used by the internal planning
department are taken into consideration.
Individual allowances and write-offs (partially or fully) on trade receivables are applied if
there are objective indications for missing collectability such as legal procedures,
insolvency or bankruptcy.
3.2 Inventories
(CHF in millions) 12/31/2023 12/31/2022
Shoes 321.4 344.7

Apparel 34.5 43.5
Accessories 8.0 8.3
Other — 0.2
Allowances (7.4) (1.1)
Inventories 356.5 395.6
In 2023, inventories of CHF 549.6 million (2022: CHF 384.8 million) and valuation allowances of CHF 6.3 million
(2022: CHF 0.6 million) were recognized in cost of sales. At reporting date, inventories held on consignment amounted
to CHF 4.0 million (2022: CHF 12.6 million).
Certain inventories have been pledged as collateral in relation to debt financing, refer to 5.4 Liquidity risk.
Accounting policies Inventories only include finished goods purchased from third parties. Cost of inventories
include expenditures incurred in acquiring the products and bringing them to their current
location and condition.
Subsequent measurement of the inventory items is made at the lower of cost or net
realizable value. Net realizable value is the estimated selling price of each specific item in
the ordinary course of business less freight and selling expenses. If the net realizable value
is below the cost, an allowance is recognized for the remaining items on stock.
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3.3 Property, plant and equipment
Furniture
Leasehold Production and
(CHF in millions) improvements Trade tools tools fixtures Other Total
Cost at January 1, 2022 20.9 7.3 11.9 3.2 4.5 47.9

Accumulated Depreciation at
January 1, 2022 (1.9) (3.5) (5.6) (0.6) (1.9) (13.5)
Net book amount at January
1, 2022 19.0 3.8 6.3 2.6 2.6 34.4
Twelve month period ended

December 31, 2022
Opening net book amounts 19.0 3.8 6.3 2.6 2.6 34.4
Additions 30.8 4.1 7.9 10.7 6.8 60.3
Disposals (0.4) (0.1) (1.3) — — (1.8)
Depreciation (3.7) (2.4) (5.3) (0.9) (1.8) (14.1)
Currency translation (1.0) (0.1) 0.0 (0.3) (0.1) (1.5)
Net book value at December
31, 2022 44.7 5.3 7.5 12.1 7.6 77.2
Cost at December 31, 2022 49.7 10.7 12.9 13.5 11.0 97.8
December 31, 2022 (5.0) (5.4) (5.3) (1.4) (3.4) (20.6)
Net book amount at
December 31, 2022 44.7 5.3 7.5 12.1 7.6 77.2

December 31, 2023
Opening net book amounts 44.7 5.3 7.5 12.1 7.6 77.2
Additions 15.1 3.8 8.8 7.4 7.7 42.8
Disposals (0.3) — — (0.1) (0.1) (0.5)
Depreciation (7.4) (2.5) (7.0) (2.1) (2.9) (21.9)
Currency translation (2.5) (0.4) — (0.8) (0.3) (4.0)
Net book value at December
31, 2023 49.6 6.1 9.4 16.5 11.9 93.6
Cost at December 31, 2023 61.2 13.6 21.7 19.9 18.1 134.5
December 31, 2023 (11.6) (7.5) (12.3) (3.4) (6.2) (41.0)
Net book amount at
December 31, 2023 49.6 6.1 9.4 16.5 11.9 93.6
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Other comprises mainly IT hardware costs. As at December 31, 2023, assets related to global retail and
corporate office expansions in the amount of CHF 2.4 million (December 31, 2022: CHF 6.4 million) are not yet in use
and not ready for use.
Accounting policies Property, plant and equipment (PPE) is valued at purchase cost less accumulated
depreciation and any impairment in value. Leasehold improvements include costs incurred
to enhance and expand offices, own retail stores and showrooms within the feasibility of
the respective lease agreement.
Depreciation is calculated on a straight-line basis over the expected useful life of the
individual assets or asset categories:
• Leasehold improvements: 5 to 8 years
• Trade tools (e.g. point-of-sale and exhibition installations): 3 years
• Production tools (e.g. molds at the factory sites): 2 years
• Furniture and fixtures: 5 to 8 years
• Other: 3 to 8 years
At each reporting date, the residual values, useful lives and method of depreciation are
reviewed and adjusted prospectively, if applicable. Furthermore, On assesses whether
there is any indication, that an asset may be impaired. If any such indication exists, the
recoverable amount (being the higher of fair value less cost of disposal or value in use) of
the individual asset is determined. If the recoverable amount is lower than carrying amount,
an impairment loss is recognized.
PPE is derecognized upon disposal or when no future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition is included in the income
statement.
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3.4 Right-of-use assets
Stores &
(CHF in millions) Storage showrooms Offices Cars Total
Cost at January 1, 2022 77.9 14.8 102.9 4.5 200.2

Accumulated Depreciation at January
1, 2022 (5.0) (3.0) (11.0) (3.3) (22.3)
Net book amount at January 1, 2022 72.9 11.9 91.9 1.2 177.9

December 31, 2022
Opening net book amounts 72.9 11.9 91.9 1.2 177.9
Lease modification (52.4) 1.7 5.1 — (45.5)
Additions — 31.7 8.2 3.6 43.4
Disposals — (0.1) (1.3) (0.2) (1.6)
Depreciation (7.1) (5.2) (9.0) (1.7) (23.0)
Currency Translation 3.4 (2.0) (0.8) (0.1) 0.4
Net book value at December 31,
2022 16.8 37.9 94.2 2.8 151.6
Cost at December 31, 2022 28.7 45.6 111.0 7.4 192.7

December 31, 2022 (11.9) (7.7) (16.8) (4.6) (41.1)
Net book amount at December 31,
2022 16.8 37.9 94.2 2.8 151.6

December 31, 2023
Opening net book amounts 16.8 37.9 94.2 2.8 151.6
Lease modification (2.1) 3.3 0.7 — 2.0
Additions 66.0 27.1 8.0 2.3 103.4
Disposals (0.1) — — (0.3) (0.4)
Depreciation (11.8) (9.2) (10.0) (1.9) (32.9)
Currency Translation (3.3) (4.1) (2.1) (0.2) (9.8)
Net book value at December 31,
2023 65.3 55.1 90.8 2.8 214.0
Cost at December 31, 2023 87.5 70.5 116.9 8.1 283.1

December 31, 2023 (22.1) (15.4) (26.1) (5.4) (69.1)
Net book amount at December 31,
2023 65.3 55.1 90.8 2.8 214.0
During 2023, our right-of-use assets additions increased from CHF 43.4 million in 2022 to CHF 103.4 million in
2023. Thereof, CHF 66.0 million relates to a new warehousing and distribution facility in Los Angeles, USA and CHF 35.1
million relates to multiple long-term leases in various retail locations in USA, China, Europe and UK, expansion of our
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regional office space in USA and Vietnam, as well as an increase of our showroom presences in France, Italy, Denmark
and Germany.
For the year ended December 31, 2023 we had a lease modification of CHF 2.1 million related to an existing
warehouse lease in Luxembourg as a result of a future lease commitment entered into for a new, highly-automated
warehouse in Belgium. For the year ended December 31, 2022 we had a lease modification of CHF 52.4 million related
to an existing warehouse lease in Atlanta, USA as a result of a future lease commitment entered into for a new, highly-
automated warehouse in Atlanta, USA.
Additionally, for the year ended December 31, 2023 we recognized CHF 0.8 million (December 31, 2022: CHF
0.3 million) income from subleasing space in our Zurich Headquarters.
The corresponding lease liabilities are reported in other current financial liabilities and other non-current financial
liabilities, respectively. Refer to 4.3 Financial liabilities for additional information.
Accounting policies On leases storage space, various offices, retail stores (including pop-ups), showrooms and
cars. Lease contracts typically run for up to 10 years, some include extension options.
At inception of a contract, On assesses whether it is a lease or contains a lease

component. A right-of-use asset and a lease liability is recognized at the lease
commencement date considering any relevant contractual condition. Short-term leases
with a lease term of 12 months or less and low-value leases are recognized as an expense
in the income statement on a straight-line basis over the lease term.
The right-of-use asset is initially measured at cost and, subsequently, at cost less
accumulated depreciation and impairment losses as well as certain lease liability
remeasurements. These costs comprise discounted and unpaid lease payments adjusted
by initial direct cost, prepaid expenses, dismantling cost, and lease incentives received.
Depreciation is calculated on a straight-line basis over the shorter of the assets or asset
categories’ useful life and the respective lease term:
• Storage: 2 to 12 years
• Offices: 2 to 15 years
• Stores and showrooms: 3 to 10 years
• Cars: 1 to 3 years
•
The lease liability is initially measured at the present value of any lease payments that are
not paid at the commencement date and are discounted using the interest rate implicit in
the lease, if that rate can be readily determined, otherwise On’s incremental borrowing
rate. The lease liability is subsequently increased by the interest cost on the lease liability
and decreased by the lease payments made. It is remeasured when there is a change in an
input parameter or in the underlying estimates and assessments.
On only acts as lessee, not as lessor. For future lease obligations refer to 4.3 Financial
liabilities
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Significant judgments On uses judgement to determine the lease term for some lease contracts which include
and accounting extension and or termination options. The assessment of whether On is reasonably certain
estimates to exercise such options impacts the lease term which significantly affects the amount of
right-of-use assets and lease liabilities recognized. A reassessment only happens when a
significant event or change in circumstance occurs that is within the control of On and
affects whether it is reasonably certain to exercise an option.
Furthermore, lease payments are discounted using the interest rate implicit in the lease, if
that rate can be readily determined. If the rate implicit in the leases is not readily
determinable, On uses the company's incremental borrowing rate, adjusted to reflect the
contract currency-specific risk, and the lease term.
3.5 Intangible assets
Patents,
licenses and
(CHF in millions) other rights Software Goodwill Total
Cost at January 1, 2022 52.8 21.4 1.8 76.0

Accumulated Amortization at January 1, 2022 (10.9) (7.6) — (18.5)
Net book amount at January 1, 2022 41.9 13.8 1.8 57.5
Twelve month period ended December 31, 2022

Opening net book amounts 41.9 13.8 1.8 57.5
Additions 16.4 6.3 — 22.7
Disposals — (0.5) — (0.5)
Amortization (4.1) (5.2) — (9.3)
Net book value at December 31, 2022 54.2 14.4 1.8 70.3
Cost at December 31, 2022 69.2 25.9 1.8 96.9

Accumulated Amortization at December 31, 2022 (15.0) (11.6) — (26.6)
Net book amount at December 31, 2022 54.2 14.4 1.8 70.3
Twelve month period ended December 31, 2023

Opening net book amounts 54.2 14.4 1.8 70.3
Additions 1.2 3.1 — 4.4
Amortization (4.5) (5.5) — (10.1)
Currency Translation — (0.1) — (0.1)
Net book value at December 31, 2023 50.9 11.9 1.8 64.6
Cost at December 31, 2023 70.4 29.0 1.8 101.2

Accumulated Amortization at December 31, 2023 (19.6) (17.1) — (36.6)
Net book amount at December 31, 2023 50.9 11.9 1.8 64.6
As at December 31, 2023, patents, licenses and other rights include patents, domain names, and license rights
for trademarks.
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As at December 31, 2023, software includes capitalized IT development costs not yet in use in the amount of
CHF 0.3 million (December 31, 2022: CHF 0.3 million). In 2023, costs recognized in general and administrative expenses
within the income statement for research, design and development amount to CHF 8.9 million (2022: CHF 8.2 million).
Goodwill is allocated and monitored at the segment level. Based on the annual impairment assessments
performed, there was no need to recognize any impairment of goodwill in 2023 nor 2022. None of the goodwill is
expected to be deductible for tax purposes.
Accounting policies Intangible assets acquired are valued at purchase cost less accumulated amortization and
any impairment in value. On only capitalizes certain IT development costs if the identifiable
asset is cumulatively commercially and technically feasible, can and will be completed, its
costs can be measured reliably, and will generate probable future economic benefits. All
other research and development costs are expensed as incurred as SG&A.
Goodwill acquired in a business combination is measured at cost less any impairment in

value. Goodwill is not amortized but is assessed for impairment annually or whenever
events or changes in circumstances indicate that its value might be impaired.
Except for goodwill, On has no intangible assets with an indefinite useful life.
Amortization is calculated on a straight-line basis over the expected useful life of the
individual assets or asset categories:
• Patents, licenses and other rights: Determined separately for each asset, varies
from 4 to 20 years
• Software acquired: 4 years
• IT development costs capitalized: 4 years
For capitalized IT development costs, amortization starts when the asset is ready for use.
Capitalized IT development costs not yet in use are tested annually for impairment or
whenever events or changes in circumstances indicate that its value might be impaired.
At each reporting date, the residual values, useful lives and method of amortization are
reviewed and adjusted prospectively, if applicable. Furthermore, On assesses whether
there is any indication, that an asset may be impaired. If any such indication exists, the
recoverable amount (the higher of fair value less cost of disposal or value in use) of the
asset is estimated. If the recoverable amount is lower than carrying amount, an impairment
loss is recognized.
Intangible assets are derecognized upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition is included in
the income statement.
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Significant judgments On uses judgement to determine commercial and technical feasibility when capitalizing
and accounting certain IT development costs. In calculating the respective costs, both planning and actual
estimates data are taken into consideration. The determinants are reviewed on a regular basis.
The intangible asset corresponding to license rights was calculated using the relief from
royalty method, based on royalty data for comparable license agreements and businesses
in the sporting goods and sports apparel sector. To validate the appropriateness of the
royalty rate, the Knoppe formula was applied. When determining the fair value, a discount
rate of 9.3% was used. The entity approach in terms of the weighted average cost of
capital was applied. The saved license expenses (after tax) where calculated based on the
estimated revenue multiplied with the relevant royalty rate.
For the purpose of impairment testing, the recoverable amount of the respective intangible
asset is compared to its carrying amount. The recoverable amounts (the higher of fair value
less cost of disposal or value in use) are measured on the basis of value-in-use calculations
and as such are significantly impacted by the projected cash flows, the discount rates, and
other parameters applied. These projections, estimates and input parameters subject to
management judgment could vary significantly from future actuals.
3.6 Other current operating assets and liabilities
(CHF in millions) 12/31/2023 12/31/2022
Prepaid expenses 20.8 21.0

Indirect taxes (VAT/GST) receivables 26.6 39.7
Social security receivables 0.4 9.3
Other current assets 13.3 7.0
Other current operating assets 61.2 77.0
(CHF in millions) 12/31/2023 12/31/2022
Accrued expenses 81.2 25.0

Accrued personnel expenses 20.0 10.9
Indirect taxes (VAT/GST) payables 24.0 26.9
Social security payables 6.7 2.5
Other payables 16.5 13.2
Other current operating liabilities 8.0 3.3
Other current operating liabilities 156.4 81.7
Accrued expenses mainly comprise accruals for outstanding vendor invoices related to marketing, freight,
customs, selling and distribution. Increase in accrued expenses is mainly attributable to investment in brand building
initiatives in the fourth quarter and timing. Accrued personnel expenses mainly comprise accruals for costs related to
bonus, vacation and participation plans. Anticipated sales returns and the corresponding liabilities are reported in other
current assets and liabilities, respectively.
F-24
4 Capital and financial management
4.1 Net cash and cash equivalents
(CHF in millions) 12/31/2023 12/31/2022
Current bank accounts 210.3 309.7

Digital wallets 11.4 12.5
Fixed deposit 272.9 48.8
Net cash and cash equivalents1 494.6 371.0
1
Net cash and cash equivalents included restricted cash in the amount of CHF 0.2 million as at December 31, 2023 and
CHF 129.5 million as at December 31, 2022. The restricted cash as at December 31, 2022 related to a bank guarantee in
favor of third parties associated with a future lease commitment. This bank guarantee was rolled into the CHF 700
million multicurrency credit facility entered into in on July 7, 2023, no longer requiring the Company to maintain
restricted cash for this bank guarantee (refer to 4.8 Commitments and contingencies).
Digital wallets mainly include deposit account balances at online payment platforms such as PayPal. Current
bank overdrafts are repayable on demand and are reported in other current financial liabilities on the balance sheet.
Accounting policies Cash and cash equivalents include short-term highly liquid assets with a maturity of three
months or less. On measures cash and cash equivalents at amortized costs. On does not
recognize any credit impairment losses on these assets as the related credit risk is
considered to be insignificant due to their short-term maturity and the external
counterparties’ credit ratings.
4.2 Other current financial assets
(CHF in millions) 12/31/2023 12/31/2022
Credit cards 16.4 6.9

Deposits 14.6 22.5
Other current financial assets 3.2 3.8
Other current financial assets at amortized cost 34.2 33.2
Other current financial assets at fair value through profit and loss — —
Total other current financial assets 34.2 33.2
Due to their short-term nature, the carrying amount of other current financial assets at amortized cost
correspond to their fair value. As of December 31, 2023, other current financial assets include contract assets in the
amount of CHF 1.1 million (December 31, 2022: CHF 0.7 million). The related customer refund liabilities have been
disclosed in 4.3 Financial liabilities.
Refer to 5.2 Foreign currency risk for additional information on derivatives.
F-25
Accounting policies On’s financial assets include cash and cash equivalents, trade receivables, and other
current financial assets, which initially are recognized at fair value. Depending on the
business model for managing these assets and the contractual terms of the resulting cash
flows, On classifies financial assets as follows:
Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest, are measured at amortized cost.
Interest income from these financial assets is included in financial result. Any gain or loss
arising on derecognition is recognized directly in the income statement.
Assets that do not meet the criteria above for amortized cost are measured at fair value
through profit and loss. Any gain or loss on these assets is recognized immediately in the
income statement.
4.3 Financial liabilities
(CHF in millions) 12/31/2023 12/31/2022
Current lease liabilities 38.7 21.6

Other financial liabilities 14.8 9.5
Total other current financial liabilities at amortized cost 53.4 31.2
Non-current lease liabilities 190.3 138.8
Total other non-current financial liabilities at amortized cost 190.3 138.8
Total current and non-current financial liabilities 243.7 170.0
Due to their short-term nature, the carrying amount of other current financial liabilities at amortized cost
correspond to their fair value. As of December 31, 2023, other current financial liabilities include customer refund
liabilities in the amount of CHF 12.4 million (December 31, 2022: CHF 9.5 million) which generally reverses in the
subsequent quarter due to the relatively short return and refund period. The related contract assets have been disclosed
in 4.2 Other current financial assets.
Certain assets have been pledged in relation to current bank overdrafts, refer to 5.4 Liquidity risk for additional
information.
Accounting policies On’s financial liabilities include trade payables, current bank overdrafts repayable on
demand, short-term debts incl. bank loans, and other financial liabilities, which initially are
recognized at fair value. Subsequently, financial liabilities are measured at amortized cost
using the effective interest method. Interest expense and foreign exchange gains and
losses are recognized in the income statement. A financial liability is only classified as at
fair value through profit or loss if it is a derivative.
Financial liabilities are derecognized when the contractual obligations are discharged,
cancelled, or expired.
F-26
Reconciliation of liabilities arising from financing activities:
Lease
(CHF in millions) liabilities Other Total
Balance at January 1, 2022 180.9 6.5 187.3

thereof current 13.6 6.5 20.1
thereof non-current 167.2 — 167.2
Payments (15.8) (5.1) (20.9)
Interest expenses paid (4.2) — (4.2)
Additions 43.6 8.2 51.7
Lease modification (45.5) — (45.5)
Accrued interest 4.2 — 4.2
Disposals (3.0) — (3.0)
Exchange differences 0.3 — 0.3
Balance at December 31, 2022 160.5 9.5 170.0
Payments (25.4) (7.7) (33.1)
Interest expenses paid (6.4) — (6.4)
Additions 103.0 13.0 116.0
Lease modification 1.7 — 1.7
Accrued interest 6.4 — 6.4
Disposals (0.3) — (0.3)
Exchange differences (10.6) — (10.6)
Balance at December 31, 2023 228.9 14.8 243.7
F-27
4.4 Financial result

Interest income 11.0 5.6 0.0

Interest income employee benefits 0.5 0.1 —
Financial income 11.5 5.7 0.0
Bank charges and interest expenses (4.3) (2.1) (1.1)
Interest expenses leases (6.5) (4.2) (2.4)
Interest expenses employee benefits (0.5) (0.1) —
Financial expenses (11.3) (6.4) (3.6)
Foreign exchange losses (111.4) (6.5) (16.3)
Change in fair value of foreign exchange derivatives — — 1.4
Foreign exchange result (111.4) (6.5) (14.9)
Financial result (111.1) (7.2) (18.5)
As at December 31, 2023, bank charges and interest expenses mainly included commitment fees paid for the
CHF 700 million multicurrency credit facility entered into on July 7, 2023. Bank charges and interest expenses as at
December 31, 2022 mainly included commitment fees paid for the three bank overdraft facilities. Refer to 5.4 Liquidity
risk for additional information.
The increase in foreign exchange gain/(losses) during the period ended December 31, 2023 was primarily due to
the negative effect to our monetary assets from the fluctuation in the exchange rates, in particular the CHF/USD
exchange rate.
F-28
4.5 Share capital
The share capital amounts to CHF 33.5 million and is divided into 299,998,125 registered shares with a nominal
value of CHF 0.10 each (the "Class A Shares") and 345,437,500 registered shares with a nominal value of CHF 0.01 each
(voting right shares) (the "Class B Shares"). No preference shares and no restrictions with Class A ordinary shares exist.
The share capital is paid in at 100%.
Class A Class A Class A Class B

Authorized
and
Authorized outstanding
registered Shares held by Outstanding registered
shares On in treasury shares shares
Balance at January 1, 2023 299,998,125 (18,021,738) 281,976,387 345,437,500
Sale of treasury shares related to share-based — 2,273,239 2,273,239 —

compensation
Purchase of On shares from employees (sell-to-
cover) at market price and held in treasury — (34,349) (34,349) —
Balance at December 31, 2023 299,998,125 (15,782,848) 284,215,277 345,437,500
In 2023, 2,273,239 Class A shares held in treasury have been issued to employees and members of the Board of
Directors. This transaction resulted in a cash inflow of CHF 10.1 million. To cover the cost for the resulting individual
social security and personal tax obligations, respective employees and members of the Board of Directors were offered
the option to either pay cash or sell-back shares for the same value at market price ("sell-to-cover"). As part of this
transaction, On re-purchased 34,349 Class A shares, held in treasury, in the amount of CHF 0.8 million.
4.6 Earnings per share

Basic earnings per share (EPS) is calculated by dividing On’s net income or loss for the period by the weighted
average number of ordinary shares outstanding during the year.
Diluted EPS is calculated by dividing On’s net income or loss for the period by the weighted average number of
ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued
at conversion of all the dilutive potential ordinary shares into ordinary shares. Dilutive effects arise from equity settled
shares from the Company's share-based plans. These shares are included even if the service conditions are not met, or
respective performance conditions were fulfilled at the end of the reporting period. For the period ended December 31,
2021, the Company excluded 5,278,761 weighted shares from the Class A diluted EPS calculation and 2,099,551
weighted shares from the Class B diluted EPS calculation, as the impact of the shares are considered anti-dilutive.
F-29
2023 2023 2022 2022 2021 2021
Class A Class B Class A Class B Class A Class B
Weighted number of outstanding

shares 284,262,802 345,437,500 282,195,495 345,437,500 264,171,208 241,333,048
Weighted number of shares with
dilutive effects 3,306,122 11,446,403 2,354,500 6,891,423 — —
Weighted number of outstanding 287,568,924 356,883,903 284,549,995 352,328,923 264,171,208 241,333,048
shares (diluted and undiluted)
Net income / (loss) (mCHF) 70.9 8.6 51.4 6.3 (156.0) (14.2)
Basic EPS (CHF) 0.25 0.02 0.18 0.02 (0.59) (0.06)
Diluted EPS (CHF) 0.25 0.02 0.18 0.02 (0.59) (0.06)
4.7 Capital and other reserves
(CHF in millions) 12/31/2023 12/31/2022
Share premium 756.9 756.9

Legal reserves 42.3 33.8
Equity transaction costs (8.7) (8.7)
Tax impact on equity transaction costs 1.3 1.3
Share-based compensation 349.1 321.8
Capital reserves 1,140.8 1,105.1
Actuarial gains and losses (2.1) 1.3
Taxes on actuarial gains and losses 0.4 (0.2)
Other reserves (9.8) —
4.8 Commitments and contingencies

As at December 31, 2023, bank guarantees and letters of credit in the amount of CHF 155.6 million
(December 31, 2022: CHF 126.1 million) were provided in favor of third parties. Thereof, CHF 111.9 million and CHF 27.9
million (December 31, 2022: CHF 126.1 million and CHF — million) related to contracts entered into for highly-automated
warehouses in the United States (Atlanta) and Belgium (Beringen), respectively.
As at December 31, 2023, CHF 155.3 million of bank guarantees and letters of credit have been rolled into the
CHF 700 million multicurrency credit facility entered into on July 7, 2023. Refer to 5.4 Liquidity risk for additional
information.
The Swiss On entities form a VAT group and, hence, every entity participating in the group is jointly and severally
liable for VAT debt of other group participants. Further, On Group entities participating in central cash pooling are jointly
and severally liable for any debit position or outstanding overdraft in connection with them. In that context, gross
balances in the amount of CHF 112.6 million have been offset as at December 31, 2023 (December 31, 2022: CHF 202.4
million).
On has committed itself to several new lease contracts, which have not yet commenced as at December 31,
2023, and are therefore not yet recognized on balance sheet. The total committed future outflow resulting of these lease
contracts amounts to:
F-30
(CHF in millions) 12/31/2023 12/31/2022
Due < 1 year 15.8 6.6

Due 1 - 5 years 145.4 92.1
Due > 5 years 224.5 184.2
Commitments for future lease obligations 385.7 282.9
The majority of the future lease commitments relate to contracts entered into for new highly-automated
warehouses in the United States (Atlanta) and Belgium (Beringen), respectively. The new warehouse in the United States
will partially operate starting in 2024 and is expected to be fully operational by 2025, and amounts to CHF 245.8 million
(December 31, 2022: CHF 254.9 million) lease commitment. The new warehouse in Belgium will partially operate
starting in 2024 and is expected to be fully operational by 2026, and amounts to CHF 122.5 million (December 31, 2022:
CHF — million) lease commitment. The remaining lease commitments relate to new stores in the United States.
5 Risk management
On is exposed to market risk, foreign currency risk, credit risk and liquidity risk. On’s senior management
oversees and monitors these risks supported by the Audit Committee that assures proper identification, measurement
and management of these financial risks by implementing and maintaining a financial governance framework. The Board
of Directors reviews and agrees policies for managing each of these risks at least once a year.
5.1 Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to
changes in market prices. Market risk comprises of three types of risk: interest risk, currency risk and other price risk.
Financial instruments affected by market risk include cash and cash equivalents. On has no significant exposure to
interest rate changes and other price risk.
In order to minimize the risks related to a potential unavailability of products, production capacity, and raw
materials in the time required by production, On adopts a multi-sourcing strategy of diversifying suppliers and purchase
plans with a medium-term time horizon. The price for raw materials and products and the corresponding fixed price
period are generally agreed with business partners prior to the purchase order issuance and remains firm and
unchanged for a six-month period in the absence of significant exchange rate and commodity price fluctuation (resulting
in excess of ±3% of originally confirmed fixed price).
There were no material changes in the Group’s market risk exposures or changes in the way risk is managed
and valued during the period.
5.2 Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of
changes in foreign exchange rates. On’s exposure to the risk of changes in foreign currency rates is a direct result of
multi-currency cash flows within the company. The vast majority of the transactional risk arises from product sourcing in
USD, while sales are typically denominated in the local currency of the respective companies and sales markets. The
currencies in which these transactions are mainly denominated are USD, EUR, CHF, GBP, JPY, CNY, BRL, AUD and
HKD.
F-31
The following table sets forth the foreign exchange rate against the Swiss Franc at the closing dates:
Currency 12/31/2023 12/31/2022
AUD 1 0.57 0.63

BRL 100 17.32 17.68
CAD 1 0.63 0.68
CNY 100 11.85 13.26
EUR 1 0.93 0.99
GBP 1 1.07 1.11
JPY 100 0.60 0.70
HKD 1 0.11 0.12
USD 1 0.84 0.93
The following table sets forth the average annual foreign exchange rate against the Swiss Franc:
Currency 12/31/2023 12/31/2022 12/31/2021
AUD 1 0.61 0.67 0.70

BRL 100 18.16 18.49 17.23
CAD 1 0.68 0.74 0.73
CNY 100 13.03 14.46 14.23
EUR 1 0.99 1.02 1.10
GBP 1 1.13 1.20 1.27
JPY 100 0.66 0.75 0.85
HKD 1 0.12 0.13 0.12
USD 1 0.92 0.96 0.92
F-32
Accounting policies
On’s consolidated financial statements are presented in CHF, which is On’s functional and
presentation currency. For each group entity, On determines its functional currency based
on the primary economic environment in which the entity operates (normally the local
currency). Items included in the financial statements of each group entity are measured
using that functional currency.
Foreign currency transactions are translated into the respective functional currency using
the exchange rate at the transaction date. Monetary assets and liabilities denominated in
foreign currencies are translated into the functional currency using the exchange rate at the
reporting date. The resulting exchange differences are recorded in the local income
statements of the group entity and included in the financial result.
Non-monetary items that are measured based on historical cost in a foreign currency are
translated using the historical exchange rate.
The group entities’ foreign currency financial statements are translated into On’s
presentation currency CHF as follows:
• Assets and liabilities for each balance sheet presented are translated at the closing
exchange rates at the reporting date.
• Income and expenses for each statement of profit or loss and statement of
comprehensive income are translated at average exchange rates.
• All resulting exchange differences are recognized in other comprehensive income
in equity.
• On disposal of a group entity, the related cumulative translation adjustment is
transferred from equity to the income statement.
On regularly assesses its exposure to foreign currency risks and manages these risks by using a combination of
different derivative financial instruments on a rolling basis up to twelve months. These instruments are exclusively used
for managing the exposure to fluctuations in foreign exchange rates connected with future cash flows and not for
speculative positions. No hedge accounting is applied. Derivative instruments are recorded as financial assets or
liabilities at fair value through profit or loss.
On offsets positive and negative fair values of derivative instruments and reports the net amount in either current
financial assets or current financial liabilities. The respective amount as at December 31, 2023 and 2022 was CHF
0.0 million.
Any gains or loses from the fair value of derivative instruments are reported net in financial result in the
consolidated statements of income/(loss). The respective amount recognized in financial result for the periods ended
December 31, 2023 and 2022 was CHF 0.0 million (2021: CHF 1.4 million gain).
Accounting policies On’s derivative financial instruments only include foreign exchange forward contracts.
Derivatives are initially recognized in the balance sheet at fair value and are remeasured as
to their current fair value at the end of each subsequent reporting period. Derivatives are
derecognized upon settlement.
Positive and negative fair values of derivative instruments are offset if they are concluded
with the same counterparty and are regularly settled simultaneously.
F-33
Financial assets and liabilities held in foreign currency as at December 31, 2023 and 2022, expressed in CHF, were as
follows:
(CHF in millions) 12/31/2023 12/31/2022

USD EUR USD EUR
Cash and cash equivalents 248.7 69.8 184.6 9.2

Trade receivables and other financial assets 640.0 102.1 257.9 5.3
Trade payables and other financial liabilities (257.6) (84.5) (42.9) (0.7)
Total assets and liabilities 631.2 87.4 399.6 13.8
Although On's reporting currency is the Swiss Franc, a significant portion of our business is conducted in
currencies other than the Swiss Franc. As a result, On is exposed to foreign currency exchange movements, primarily in
the U.S. Dollar and the Euro. A change in the strength of the Swiss Franc against these two currencies as of December
31, 2023, 2022 and 2021 would have affected the valuation of assets and liabilities denominated in these foreign
currencies. This analysis assumes that all other variables remain constant. The exposure is disclosed net of income tax
and excludes the impact of derivative financial instruments. A 10% increase or decrease in the USD or EUR foreign
currency exchange rates against the Swiss Franc would have impacted On's consolidated profit/(loss) for the period as
presented below.
(CHF in millions) 12/31/2023 12/31/2022 12/31/2021
Change in USD/CHF +10% 71.2 32.1 61.1

Change in USD/CHF -10% (71.2) (32.1) (61.1)
Change in EUR/CHF +10% 7.3 1.1 0.4
Change in EUR/CHF -10% (7.3) (1.1) (0.4)
5.3 Credit risk
Credit risk is the possibility of a loss resulting from a counterparty’s failure to meet its contractual obligation. On
is exposed to credit risks from its operating activities and from certain financing activities. A potential concentration in
credit risk mainly arise from trade receivables and other financial assets such as credit cards and deposits. The
maximum exposure is limited to the respective carrying amounts.
Due to its fragmented customer base (no relevant concentration of credit risk by type of customer or
geography), On’s credit risk exposure is mainly influenced by individual customer characteristics. Core banking
relationships are maintained with investment grade rated financial institutions only.
New customers are assessed for creditworthiness before standard payment and delivery terms and conditions
are offered, and individual tolerance limits are established. Creditworthiness as well as customers receivable limits are
monitored on an ongoing basis. Customers that fail to meet On’s minimum creditworthiness may, in general, order only
on a prepayment basis.
5.4 Liquidity risk
F-34
Liquidity risks arise from not having the necessary resources available to meet maturing liabilities with regard to
timing, volume and currency structure. On’s finance department is centrally managing the net cash and cash equivalent
position to mitigate liquidity risk and to ensure On’s obligations can be settled on time.
Main procedures in place to mitigate liquidity risks comprise:
• Centralized control system to manage the net financial position of On and its subsidiaries;
• Obtaining and maintaining forward-looking credit lines to create an adequate debt structure optimizing the
liquidity provided by the credit system;
• Continuous monitoring of future cash flows based on rolling forecast and budget data.
Contractual maturities of On’s undiscounted financial liabilities:
Due
Due 4 to 12 Due Due
(CHF in millions) < 3 months months 1 to 5 years > 5 years 12/31/2023
Trade payables 65.1 — — — 65.1

Current lease liabilities 11.7 35.2 — — 46.9
Other financial liabilities 14.8 — — — 14.8
Other current financial liabilities 26.5 35.2 — — 61.7
Non-current lease liabilities — — 135.1 81.3 216.4
Other non-current financial
liabilities — — 135.1 81.3 216.4
Due
Due 4 to 12 Due Due
(CHF in millions) < 3 months months 1 to 5 years > 5 years 12/31/2022
Trade payables 111.0 — — — 111.0

Current lease liabilities 5.8 18.5 — — 24.4
Other financial liabilities 9.5 — — — 9.5
Other current financial liabilities 15.4 18.5 — — 33.9
Non-current lease liabilities — — 73.6 79.7 153.3
Other non-current financial
liabilities — — 73.6 79.7 153.3
As at December 31, 2023 and 2022, the Company's accrued expenses included CHF 69.6 million and CHF 25.0
million, respectively, related to outstanding vendor invoices for marketing, freight, customs, selling and distribution
costs, with an expected due date in the next three to four months.
On July 7, 2023, On entered into a CHF 700 million multicurrency credit facility agreement. On has 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. As of the date hereof, we have utilized CHF 155.3 million of this credit
facility to cover our bank guarantees and letters of credit as mentioned in 4.8 Commitments and contingencies. We have
not drawn cash under this credit facility and we do not currently expect to draw cash from the facility agreement in the
near term. We entered into the facility agreement 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
facility agreement may be used towards the financing of working capital requirements and for general corporate
purposes of the Company, including the roll-in of certain existing bank guarantees and the issuance of new bank
guarantees. The facility agreement has an initial term of three years and may be extended twice for a period of one year
each.
F-35
As at July 7, 2023, the bank guarantees mentioned in 4.8 Commitments and contingencies have been rolled into
this new facilities agreement and we no longer have any restricted cash as mentioned in 4.1 Net cash and cash
equivalents.
As at December 31, 2022, we had three bank overdraft facilities with different lenders with credit limits of up to
CHF 100 million, CHF 25 million and USD 35 million, respectively.
The new multicurrency 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 year ended December 31, 2023, we were in
compliance with all covenants under the new credit facility. As of and during the year ended December 31, 2022 we
were in compliance with all covenants under the previous bank overdraft facilities.
The following assets have been pledged in relation to the new multicurrency credit facility agreement:
(CHF in millions) 12/31/2023 12/31/2022
Trade receivables 145.8 43.4

Inventory 285.2 234.9
Assets pledged 431.0 278.3
5.5 Capital risk management

To uphold investor, creditor, and market confidence and to sustain future development of the business, On
focuses on maintaining a strong capital base. On manages its capital structure and makes adjustments in line with
changes in general economic conditions and according to its strategic objectives.
6 Other disclosures
6.1 Share-based compensation

Over the previous years, On has granted share-based awards to selected employees, including executives and
senior management team members. These grants have come out of various equity plans, designed to reward long-term
and valued employees for their individual performance by giving them the opportunity to benefit from the involvement of
On by receiving a bonus in the form of share-based payment awards.
All awards granted under the different share-based compensation plans were classified as equity-settled share-
based payments. If applicable, grants in the form of stock options are valued using a Cox-Rubinstein binomial tree
model. In addition to the share-based compensation plans for selected employees, On granted share-based
compensation in connection with a service, license, and investment agreement. The Long Term Incentive Plan (LTIP)
2021 as well as the plan for Compensation of non-executive members of the Board of Directors of On (BoD) 2019 are
currently the only share-based compensation plans that remain active and will see additional grants in the periods
following the period ended December 31, 2023. These plans foresee grants either in the form of performance stock units
(PSUs) or restricted stock units (RSUs). PSUs are subject to the achievement of certain performance criteria and require
plan participants to provide services during this period, whereas RSUs are only conditional on the provision of services
by the plan participant during the vesting period.
As at December 31, 2023, On has recognized an increase in equity in the balance sheet of CHF 27.3 million
(December 31, 2022: CHF 38.3 million) for share-based compensation. In 2023, the Company recognized share-based
compensation expense in the amount of CHF 31.8 million (2022: CHF 33.8 million), of which CHF 24.4 million related to
the LTIP 2021 plan and CHF 7.4 million to the other plans (2022: CHF 32.7 million related to the LTIP 2020 plan and CHF
1.1 million to the other plans).
F-36
Overview of the different programs:
On Employee Awards under the OEPP 2018 were granted as phantom shares. Any historical grants
Participation Plan that remained outstanding at the time were exchanged for Restricted Stock Units (RSUs)
(OEPP) 2018 in 2021. The RSUs under the OEPP 2018 met their full vesting requirements in
connection with our IPO in September 2021, which constituted an exit event.
The RSUs have been largely settled in Class A ordinary shares. The remaining
outstanding awards are pending approval from certain jurisdictions and will be
distributed once such approval is granted.
Long Term Participation Awards under the LTPP 2018 were granted either as options or as phantom shares. Any
Plan (LTPP) 2018 historical phantom shares that remained outstanding at the time were exchanged for RSUs
in 2021. All grants under the LTPP 2018 were subject to a time-based vesting of three
years following the respective grant date. The final grants met their vesting requirements in
March 2023, at the end of their vesting term.
The remaining outstanding awards under the LTPP 2018 are fully vested and exercisable.
Vested options may be exercised until the tenth anniversary of the contractual granting
date.
Long Term Incentive Awards under the LTIP 2018 were granted as options. All options under the LTIP 2018
Plan (LTIP) 2018 met their vesting requirements either due to the exit valuation achieved during a private
capital round in February 2020, or as a result of achieving the business continuation
thresholds set out at the initiation of the plan.
The remaining outstanding awards under the LTIP 2018 are fully vested and exercisable.
Vested options may be exercised until the fifth anniversary of the contractual granting
date.
Long Term Incentive Awards under the LTIP 2020 were granted as options, with the final grant issued in
Plan (LTIP) 2020 2022. All options granted under the LTIP 2020 met their full vesting requirements in
connection with our IPO in September 2021, which constituted an exit event.
The remaining outstanding awards under the LTIP 2020 are fully vested and exercisable.
Vested options may be exercised until the seventh anniversary of the contractual
granting date.
Founders' Plan In connection with On's IPO in 2021, certain employees of On who were not eligible for
2021 other equity compensation from an existing share-based compensation plan were awarded
with a bonus for their contribution to the listing under the Founders' Plan 2021. Awards
under the Founders' Plan 2021 were granted as RSUs. All RSUs under the Founders' Plan
2021 were not subject to any vesting requirements and were distributed once operationally
feasible post the IPO.
The remaining outstanding awards are pending approval from certain jurisdictions and will
be distributed once such approval is granted.
F-37
Tax Recognition Plan In 2022 and 2023, RSUs were granted to certain employees of On who were subject to
2022 elevated tax obligations in connection with prior grants of equity incentive awards or RSUs
vesting in connection with the Company's IPO.
The RSUs immediately vested upon grant, subject to an administrative period to allow for
the acceptance of awards by participants.
Service, License, and In 2019, a “service, license and investment agreement” was negotiated between On and
Investment Agreement third parties, including the payment of share-based compensation in exchange for the
(SLIA) 2019 services provided by the third parties. Awards under the SLIA 2019 were granted as
options. The milestone-based vesting criteria include the achievement of certain Net Sales
thresholds for the fiscal year ending December 31, 2023 as well as the fiscal year ending
December 31, 2024. If the respective milestones are reached, the formal vesting of the
options occurs upon publication of the annual report for the fiscal year ending December
31, 2023 as well as the fiscal year ending December 31, 2024, respectively.
Vested options may be exercised until the six month anniversary of the vesting date.
Compensation of Awards under the share-based compensation program for non-executive members of the
non-executive Board of Directors are granted as RSUs. These awards are granted to On's non-executive
members of the Board of board members that receive equity compensation for their services as members of On's
Directors of On (BoD) Board of Directors on a quarterly basis.
2019
The RSUs are not subject to vesting requirements and immediately vest upon grant,
subject to an administrative period to allow for the acceptance of awards by participants.
F-38
Long Term Incentive In 2021, the LTIP 2021 was implemented to replace the existing share-based
Plan (LTIP) 2021 compensation plans in place at the time and is the currently active share-based
compensation plan for equity compensation to On's team members. In March 2023, the
LTIP 2021 was amended with the revised vesting parameters described below.
Awards under the LTIP 2021 are granted as RSUs or Performance Stock Units (PSUs) and
are subject to time-based and in the case of PSUs additional performance-based vesting
conditions.
Subject to a participant's continuous employment and unless otherwise agreed in a

participant's award agreement, 34% of RSUs granted vest on the first anniversary of the
granting date; thereafter, 8.25% of the RSUs vest at the end of each quarter following the
first anniversary of the granting date.
Any grant of PSUs is split equally between a two year performance cycle and a three year
performance cycle. Subject to a participant's continuous employment, the achievement of
the performance conditions as well as the resulting vesting factor and unless otherwise
agreed in a participant's award agreement, the PSUs vest in full 24 months following the
grant date (for a two year performance cycle) and 36 months following the granting date
(for a three year performance cycle).
PSU grants to members of On's Executive Board are subject to a market-based award
multiplier, based on the achievement of On's total shareholder return relative to a broad
market index measured over the same two year and three year performance cycle.
Prior to the amendment in March 2023, grants were subject to time-based and in the case
of PSUs additional performance-based vesting conditions. Subject to the participant's
continuous employment and unless otherwise agreed in a participant's award agreement,
33 1/3% of the RSUs granted were scheduled to vest on the grant date and on the first
anniversary of the granting date, respectively, so that the remaining 33 1/3% vest on the
second anniversary of the grant. The PSUs granted were scheduled to vest on the third
anniversary of the grant date, subject to the achievement of the performance conditions,
measured over the performance cycle, and the resulting vesting factor.
In December 2022, to account for local laws in the U.S. that did not allow for grants to U.S.
participants under the LTIP 2020, replacement grants were provided to U.S. participants
that would have qualified for a grant under the LTIP 2020. These replacement grants were
granted as RSUs under the LTIP 2021, and were agreed to vest immediately upon grant, to
allow for the same economic benefit to the U.S. participants, that they would have
otherwise received as a part of their qualification for a grant under the LTIP 2020 (further
details on the LTIP 2020 can be found above).
Upon vesting, the awards are distributed to participants in the form of shares as soon as
operationally feasible.
F-39
A summary of activity under the plans as of December 31, 2023, December 31, 2022, and changes during the
years ending on those dates, is presented below:
Program LTPP 2018 LTIP 2018

Weighted Weighted
average average
Number of exercise Number of exercise
options price US$ options price US$
Awards outstanding at January 1, 2022 2,026,250 0.04 865,000 3.26

Awards granted — n/a — n/a
Awards forfeited (31,250) 0.11 — n/a
Awards exercised (746,250) 0.03 (505,000) 2.32
Awards outstanding at December 31, 2022 1,248,750 0.04 360,000 4.59
weighted average contractual life remaining (years) 0.1 n/a — n/a
with maximum term (years) 0.2 n/a — n/a
thereof exercisable 1,038,750 0.03 360,000 4.59
Awards outstanding at January 1, 2023 1,248,750 0.04 360,000 4.59
Awards exercised (680,118) 0.03 (62,500) 0.11
Awards outstanding at December 31, 2023 561,132 0.05 297,500 5.53
weighted average contractual life remaining (years) — n/a — n/a
with maximum term (years) — n/a — n/a
thereof exercisable 561,132 0.05 297,500 5.53
F-40
Program LTIP 2020 Class A shares LTIP 2020 Class B shares
Weighted Weighted
average average
Number of exercise Number of exercise
options price US$ options price US$
Awards outstanding at January 1, 2022 5,687,811 8.04 10,552,670 0.77

Awards granted 2,694,843 8.28 5,259,830 0.77
Awards exercised (3,440,590) 7.87 — n/a
Awards outstanding at December 31, 2022 4,939,564 8.28 15,812,500 0.77
thereof exercisable 4,939,564 8.28 15,812,500 0.77
Awards outstanding at January 1, 2023 4,939,564 8.28 15,812,500 0.77
Awards forfeited — 7.89 — n/a
Awards exercised (1,395,873) 8.29 — n/a
Awards outstanding at December 31, 2023 3,543,691 8.28 15,812,500 0.77
thereof exercisable 3,543,691 8.28 15,812,500 0.77
SLIA
Program OEPP 2018 BoD 2019 2019
Awards outstanding at January 1, 2022 130,000 16,833 4,700,000

Awards granted — 31,612 —
Awards forfeited — — —
Awards exercised (115,000) (48,445) —
Awards outstanding at December 31, 2022 15,000 — 4,700,000
weighted average contractual life remaining (years) — — 2.1
with maximum term (years) — — 4.0
thereof exercisable 15,000 n/a —
Awards outstanding at January 1, 2023 15,000 — 4,700,000
Awards granted — 44,966 —
Awards forfeited — — —
Awards exercised (8,750) (44,966) —
Awards outstanding at December 31, 2023 6,250 — 4,700,000
weighted average contractual life remaining (years) — — 1.1
with maximum term (years) — — 1.5
thereof exercisable 6,250 n/a —
F-41
Tax
LTIP 2021 LTIP 2021 Founders' Recognition
Program RSUs PSUs Plan 2021 2022
Awards outstanding at January 1, 2022 1,588 — 123,328 —

Awards granted 116,551 37,808 — 127,297
Awards forfeited (507) — — —
Awards exercised (110,467) — (69,997) (127,297)
Awards outstanding at December 31, 2022 7,165 37,808 53,331 —
weighted average contractual life remaining (years) 0.7 2.2 — —
with maximum term (years) 1.2 2.2 — —
thereof exercisable — — 53,331 n/a
Awards outstanding at January 1, 2023 7,165 37,808 53,331 —
Awards granted 896,311 1,034,815 17,998 7,205
Awards forfeited (37,393) (5,408) (20,331) —
Awards exercised (55,829) — (17,998) (7,205)
Awards outstanding at December 31, 2023 810,254 1,067,215 33,000 —
weighted average contractual life remaining (years) 1.0 1.7 — —
with maximum term (years) 2.2 2.2 — —
thereof exercisable 455 — 33,000 n/a
F-42
Parameters taken into account in the valuation:
For the year ended December 31, 2023
LTIP 2021 December 18, 2023 December 18, 2023 September 26, 2023 September 26, 2023
Grant date Class A RSUs Class A PSUs Class A RSUs Class A PSUs
Share price on the

measurement date (CHF) 26.52 26.52 23.81 23.81
LTIP 2021 June 23, 2023 June 23, 2023 April 1, 2023 April 1, 2023
Grant date Class A RSUs Class A PSUs Class A RSUs Class A PSUs
Share price on the

LTIP 2021 March 28, 2023 March 28, 2023 March 9, 2023
Grant date Class A RSUs Class A PSUs Class A RSUs
Share price on the

measurement date (CHF) 27.34 27.34 19.87
BoD 2019 March 27, 2023 June 23, 2023 September 26, 2023 December 18, 2023
Grant date
Class A RSUs Class A RSUs Class A RSUs Class A RSUs
Share price on the

Tax Recognition Plan 2022 January 3, 2023

Grant date
Class A shares
Share price on the measurement date (CHF) 20.84
F-43
Founders' Plan 2021 January 3, 2023
Grant date
Class A RSUs
F-44
For the year ended December 31, 2022
LTIP 2020 December 6, 2022 December 6, 2022

Grant date Class A options Class B options
Share price on the measurement date (CHF) 16.83 1.68

Expected life of the award on the grant date (years) — —
Exercise price (CHF) 7.26 - 10.65 0.73
Expected dividend yield (%) — —
Risk-free interest rate (%) n/a n/a
Expected volatility of the share price (%) n/a n/a
Option value (CHF) 6.18 - 9.57 0.96
LTIP 2021 March 31, 2022 March 31, 2022 June 24, 2022 September 23, 2022
Grant date Class A RSUs Class A PSUs Class A PSUs Class A PSUs
Share price on the

LTIP 2021 December 6, 2022 December 19, 2022

Grant date Class A RSUs Class A PSUs
BoD 2019 February 18, 2022 March 31, 2022 June 24, 2022
Grant date
Class A RSUs Class A RSUs Class A RSUs
Share price on the measurement date (CHF) 23.04 23.22 18.13
BoD 2019 September 23, 2022 December 19, 2022

Grant date Class A RSUs Class A RSUs
F-45
Tax Recognition Plan 2022 December 19, 2022
Grant date Class A shares
Accounting policies Employees and others providing similar services to On receive remuneration in the form of
share-based payments, whereby employees render services as consideration for equity
instruments (equity-settled transactions). All share-based plans of On have been identified
to be equity-settled.
The cost of equity-settled transactions is determined by the fair value at the date when the
grant is made using an appropriate valuation model. That cost is recognized as personnel
expenses, together with a corresponding increase in equity (other capital reserves), over
the period in which the service and, where applicable, the performance conditions are
fulfilled (the vesting period). The cumulative expenses recognized for equity-settled
transactions at each reporting date until the vesting date reflects the extent to which the
vesting period has expired and the On’s best estimate of the number of equity instruments
that will ultimately vest. The expense or credit in the income statement for a period
represents the movement in cumulative expense recognized as at the beginning and end of
that period.
Significant judgments Options granted during the twelve month period ended December 31, 2023 were fully
and accounting vested at the time of grant and were therefore valued on the basis of the difference
estimates between the observable share price on grant date and the respective exercise price. PSUs
and RSUs granted during the twelve month period ended December 31, 2023 were valued
on the basis of the observable share price on grant date.
When determining the expense recognition, the expected fluctuation had been set to 7.5%
per annum for grants prior to the third quarter of 2022, and to 10% per annum for grants
from the fourth quarter of 2022 onwards. These expected fluctuation levels were
determined by On based on historical fluctuation and management estimates.
6.2 Employee benefit obligations

On globally maintains different pension plans based on the respective legislation in each country. Current
pension arrangements for On employees in Switzerland are made through plans governed by the Swiss Federal
Occupational Old Age, Survivors and Disability Pension Act (BVG). These plans are funded by regular employee and
employer contributions and are administered by an independent third party. On's estimated contributions for the next
reporting period is CHF 3.6 million.
Final benefits are contribution-based with certain minimum guarantees. Due to these minimum guarantees, On’s
Swiss plan (other than the 1e pension plan) is treated as a defined benefit plan for the purpose of these financial
statements, although it has many of the characteristics of a defined contribution plan. The plan is invested in a
diversified range of assets in accordance with law, the investment strategy, and the common criteria of an asset and
liability management.
All other plans outside of Switzerland, including the 1e pension plan, are treated as defined contribution plans.
The contributions of those plans are recognized as personnel expenses in the period during which the related services
are rendered by employees. Expenses during the year ended December 31, 2023 amounted to CHF 4.1 million
(December 31, 2022: CHF 1.3 million).
F-46
The result of the Swiss defined benefit plans is summarized in the tables below:
F-47
Employee benefit obligations
(CHF in millions) December 31, 2023 December 31, 2022
Present value of defined benefit obligation (35.3) (23.7)

Fair value of plan assets 33.1 17.4
Employee benefit obligations (2.2) (6.3)
As of December 31, 2023, the defined benefit obligation has a weighted average duration of 14.7 years
(December 31, 2022: 12.9 years). There is no effect from asset ceiling in any reporting period. Employee benefit
obligations reconciles as follows:
Employee benefit obligations at January 1 (6.3) (5.9)

Amounts recognized in income statement (3.8) (3.1)
Amounts recognized in other comprehensive income (3.4) 4.4
Contributions by the employer 11.3 (1.8)
Employee benefit obligations at December 31 (2.2) (6.3)
Amounts recognized in income statement
Current service cost (3.8) (3.4) (2.6)

Past service cost — 0.3 —
Employee benefit expenses (3.8) (3.1) (2.6)
F-48
Remeasurements recognized in equity (other comprehensive income)
Actuarial losses/(gains) from

changes in demographic assumptions — — (1.8)
changes in financial assumptions 3.6 (6.8) (0.6)
changes in experience adjustments (0.2) 1.3 2.3
Return on plan assets excl. interest income — 1.1 (0.8)
Net actuarial result from defined benefit plans 3.4 (4.4) (0.9)
Defined benefit obligation
Present value of defined benefit obligation at January 1 23.7 22.8

Current service cost 3.8 3.4
Contributions by the employees 3.1 2.2
Interest expenses 0.5 0.1
Past service cost — (0.3)
Benefits paid 0.8 0.9
Actuarial losses/(gains) from
changes in financial assumptions 3.6 (6.8)
changes in experience adjustments (0.2) 1.3
Present value of defined benefit obligation at December 31 35.3 23.7
Plan assets
Fair value of plan assets at January 1 17.4 17.0

Contributions by the employer 11.3 (1.8)
Contributions by the employees 3.1 2.2
Interest income 0.5 0.1
Benefits paid 0.8 0.9
Return on plan assets excl. interest income — (1.1)
Fair value of plan assets at December 31 33.1 17.4
F-49
The plan assets consist of (all with quoted market prices):
12/31/2023 12/31/2022
Cash and equivalent 0.6 % 0.9 %

Debt instruments 28.4 % 28.0 %
Equity instruments 31.5 % 30.8 %
Real estate 23.0 % 22.8 %
Alternative assets 16.5 % 17.5 %
Total 100.0 % 100.0 %
Principal actuarial assumptions
12/31/2023 12/31/2022
Discount rate 1.4 % 2.2 %

Expected rate of salary increase 1.5 % 1.5 %
Expected rate of pension increase 0.0 % 0.0 %
Demographic assumptions BVG 2020 BVG 2020
generation generation
table table
Sensitivity analysis: Impact on defined benefit obligation
(CHF in millions) 12/31/2023 12/31/2022
Discount rate
-0.5% 2.8 1.6
+0.5% (2.3) (1.4)
Expected rate of salary increase
-0.5% (0.6) (0.4)
+0.5% 0.7 0.4
Life expectancy
-1 year (0.3) (0.2)
+1 year 0.3 0.2
F-50
Accounting policies Accounting and reporting of the Swiss defined benefit plans are based on annual actuarial
valuations. Defined benefit obligations and service costs are assessed using the projected
unit credit method, with the cost of providing pensions charged to the income statement
so as to spread the regular cost over the service lives of employees participating in these
plans. The pension obligation is measured as the present value of the estimated future
outflows using interest rates of government securities, which have terms to maturity
approximating the terms of the related liability. Service cost from defined benefit plans are
charged to the income statement within the operating result. If the fair value of the plan
assets exceeds the present value of the defined benefit obligation, only a net pension asset
is recorded, taking account of the asset ceiling.
The net interest component is calculated by applying the discount rate to the employee
benefit obligations (net defined benefit asset or liability) and is recognized in the income
statement in the financial result. Actuarial gains and losses, resulting from changes in
actuarial assumptions and differences between assumptions and actual experiences, are
recognized the equity (other comprehensive income) in the period in which they occur.
Significant judgments The carrying amounts of defined benefit pension plans are based on actuarial valuations.
and accounting These valuations are calculated based on statistical data and assumptions about discount
estimates rates, expected rates of return on plan assets, future salary increases, mortality rates and
future pension increases. Due to the long-term nature of these plans, such estimates are
subject to significant uncertainty.
6.3 Provisions
Asset
Social Long-service retirement
(CHF in millions) charges leave obligation Total
Balance at January 1, 2022 14.0 1.7 3.6 19.3

thereof current 14.0 0.7 0.1 14.9
thereof non-current — 0.9 3.5 4.4
Additions 1.4 2.7 0.3 4.4
Release (6.8) (0.5) — (7.3)
Utilization (4.4) — — (4.4)
Unwinding of discount — — 0.1 0.1
Exchange differences 0.1 (0.1) (0.1) (0.1)
Balance at December 31, 2022 4.3 3.8 4.0 12.1
thereof non-current — 3.3 3.8 7.2
Additions 5.7 3.2 0.6 9.5
Release (1.9) (1.0) — (2.9)
Utilization (1.4) — — (1.4)
Unwinding of discount — — 0.1 0.1
Exchange differences — (0.2) (0.1) (0.3)
Balance at December 31, 2023 6.8 5.8 4.5 17.1
thereof non-current 0.5 5.1 4.3 10.0
F-51
Provisions include social charges which considers any costs related to local legal requirements related to share-
based compensation. Provisions also include the long-service leave provision which relates to a jubilee bonus to reward
long-serving employees, and provisions for asset retirement obligations which mainly relates to the dismantling costs for
the headquarter in Zurich and retail stores.
Accounting policies Provisions are recognized when On has a present obligation (legal or constructive) as a
result of a past event, where it is probable that an outflow of resource will be required to
settle the obligation, and where a reliable estimate can be made of the amount of the
obligation. If the effect of the time value of money is material, provisions are determined by
discounting the expected future cash flows.
Significant judgments Provisions are based upon best estimates, taking into consideration past experience
and accounting and currently available information. Given that judgment has to be applied, the actual costs
estimates and results may differ from these estimates.
F-52
6.4 Income taxes
Current income taxes 35.7 38.7 7.1

Deferred income taxes (46.2) (18.6) 3.6
Income tax expense (benefit) (10.5) 20.2 10.6
The income taxes reflected in the financial statements and the amount calculated at the expected tax rate
(starting with On Holding AG's statutory corporate income tax rate in Switzerland) reconcile as follows:
Income / (loss) before

taxes 69.1 77.9 (159.6)
Expected tax rate /
tax expense 19.7 % 13.6 19.7 % 15.3 19.7 % (31.4)
Non-deductible
expenses 10.3 % 7.1 9.2 % 7.2 (25.4) % 40.6
Income not subject to

tax (22.4) % (15.5) (9.5) % (7.4) (0.2) % 0.3
Effects of
(de-)recognition of tax
losses (2.4) % (1.7) 2.9 % 2.2 (0.4) % 0.6
Local actual tax rate
different to On's (1.1) % (0.8) 2.0 % 1.5 (0.6) % 1.0
Prior year adjustments
and other items, net (19.2) % (13.3) 1.6 % 1.3 0.2 % (0.3)
Effective tax rate /
income tax expense
(benefit) (15.1)% (10.5) 25.9 % 20.2 (6.7)% 10.6
In 2023, the effective tax rate was (15.1)%, the effective tax rate in 2022 was 25.9%.
In both years, the effective tax rate was lowered by income not subject to tax that mainly related to tax
incentives in Switzerland granted in connection with patents. The Swiss patent box regime was more effective than in
2022 due to the higher profitability of our Swiss entities. Another positive impact on the 2023 effective tax rate is
attributable to securing prior-year tax deductions in 2023 in connection with our share-based payment plans. In order to
determine these tax benefits, a detailed analysis of prior financial years and extensive documentation was required but
not available during the original filing.
In some jurisdictions where we operate, the deduction of expenses related to share-based payment plans is
restricted. In 2023 and 2022, therefore, non-deductible expenses, mainly related to our share-based payment programs,
impacted the effective tax rate.
F-53
Change of net deferred tax assets and liabilities:
Net amount at January 1 13.9 (3.4)

thereof deferred tax assets 31.7 2.2
thereof deferred tax liabilities (17.9) (5.6)
Taxes charged
to income statement 46.2 18.6
to other comprehensive income 0.7 (0.9)
Net amount at December 31 59.1 13.9
thereof deferred tax assets 69.5 31.7
thereof deferred tax liabilities (10.5) (17.9)
F-54
Deferred tax assets and liabilities relate to the following items:
12/31/23 12/31/22
(CHF in millions) Assets Liabilities Net amount Assets Liabilities Net amount
Trade receivables 0.1 (0.6) (0.5) — (1.0) (1.0)

Inventories 50.1 (8.0) 42.0 23.4 (15.4) 7.9
Other current assets 0.7 (0.4) 0.3 0.7 — 0.7
Property, plant and
equipment 0.1 (0.1) 0.1 — (0.1) (0.1)
Right-of-use assets — (6.2) (6.2) — (6.4) (6.4)
Intangible assets — (3.0) (3.0) — (3.3) (3.3)
Other current financial
liabilities 1.1 (0.1) 1.0 1.1 — 1.1
Other current
operating liabilities 17.2 (2.6) 14.6 7.1 (0.8) 6.3
Current provisions 0.1 — 0.1 0.1 — 0.1
Employee benefit
obligations 0.4 — 0.4 1.2 — 1.2
Non-current
provisions 0.4 — 0.4 0.4 — 0.4
Other non-current
financial liabilities 6.2 — 6.2 5.6 — 5.6
Tax loss
carryforwards 3.6 — 3.6 1.2 — 1.2
Deferred tax assets
(liabilities) 80.0 (21.0) 59.1 40.9 (27.0) 13.9
Offsetting (10.5) 10.5 (9.1) 9.1
Deferred tax assets
(liabilities) on
balance sheet 69.5 (10.5) 59.1 31.7 (17.9) 13.9
Pillar Two income tax disclosure

In December 2021, the OECD published key parameters and model rules on a global minimum tax rate of 15%
(Pillar Two) for multinational enterprises with revenue of more than EUR 750 million, such as our business. Many
jurisdictions in which we are subject to income taxes, global minimum tax rules have been enacted, or substantively
enacted, which can impose detailed reporting obligations and increase compliance and systems-related costs on our
businesses. In Switzerland, where the Group is headquartered, the enacted legislation is currently limited to the
introduction of a Qualified Domestic Minimum Top-up Tax effective 1 January 2024.
We have applied the temporary exception issued by the IASB in May 2023 from the accounting requirements for
deferred taxes in IAS 12. Accordingly, we neither recognises nor discloses information about deferred tax assets and
liabilities related to Pillar Two income taxes.
As an integral part of the rule set, the OECD has published transitional Country-by-Country Report (CbCR) Safe
Harbor rules, with the purpose to remove the obligation of calculating the Pillar Two effective tax rate for operations in
lower-risk jurisdictions during the initial years when the rules take effect. In applying the transitional CBCR Safe Harbor
rules on the fiscal year end 2023 consolidated financial statements, the majority of the jurisdictions in which we operate
are expected to qualify for the transitional CbCR Safe Harbor rules.
We are continuing to assess the impact of the Pillar Two income taxes legislation on our financial performance.
F-55
Accounting policies Income taxes include all current and deferred taxes which are based on income. Taxes
which are not based on income, such as taxes on wealth and capital, are recorded as other
operating expenses.
Where the final tax outcome is different from the amounts that were initially recorded, such
differences will impact the income tax and deferred tax provisions in the period in which
such determination is made. Deferred tax is recorded on the valuation differences
(temporary differences) between the tax bases of assets and liabilities and their carrying
values in the consolidated balance sheet. Deferred tax assets are recognized to the extent
that it is probable that future taxable income will be available against which the temporary
differences and tax losses can be offset.
Deferred income tax liabilities are provided for on taxable temporary differences arising
from investments in subsidiaries, except for deferred income tax liability where the timing
of the reversal of the temporary difference is controlled by On and it is probable that the
temporary difference will not reverse in the foreseeable future.
Current and deferred tax assets and liabilities are offset whenever they relate to the same
taxing authority and taxable entity.
Significant judgments On is subject to income taxes in numerous jurisdictions and significant judgment is
and accounting required in determining the worldwide provision for income taxes. The multitude of
estimates transactions and calculations implies estimates and assumptions. On recognizes liabilities
on the basis of amounts expected to be paid to the tax authorities.
Deferred tax assets relate to deductible differences and, in certain cases, tax loss carry
forwards, provided that their utilization appears probable. The recoverable value is based
on forecasts of the corresponding taxable On entity over a period of several years. The
capitalized tax loss carryforwards are essentially related to companies with transfer price
arrangements in place, which will lead to a profit before tax. Therefore, the assumption is
that the entities can use the tax losses. As actual results may differ from these forecasts,
the deferred tax assets may need to be adjusted accordingly.
6.5 Related parties

A legal or natural person is related to an On entity if the party directly or indirectly controls, is controlled by, or is
under common control with the entity, has an interest in the entity that gives it significant influence over the entity, has
joint control over the entity or is an associate or a joint venture of the entity.
On has identified the following related parties:
• Members of the On Executive Team
• Members of the Board of Directors of On
• Shareholders that have significant influence by delegating a member into the Board of Directors of On
No related party exercises control over On.
In 2023, total share-based compensation of the non-executive members of the Board of Directors of On
amounts to CHF 1.1 million (2022: CHF 0.5 million, 2021: CHF 0.3 million).
There were no further transactions with related parties for the relevant financial years except for the following
transactions with the five members of On’s executive team:
F-56
Short-term employee benefits 4.2 2.1 1.9

Post-employment benefits 0.3 1.8 14.4
Share-based compensation 13.8 15.1 67.3
On Executive Team 18.3 19.0 83.6
6.6 Government grants

On is entitled to two investment grants within a framework of improving the regional economic structure by
providing jobs in the Berlin region from Germany’s national government authorities. The entitlement depends on various
conditions, including the number and types of jobs created and local investments spent within three years until 2021 for
the first grant, and within three years from 2021 until 2024 for the second grant, respectively. As at December 31, 2023
and 2022, the conditions for the first grant were fulfilled, however the conditions for the second grant were not yet
entirely fulfilled. On assumes to meet the second grant’s requirements by the end of the project.
In addition, during the fourth quarter 2022 On received a government grant of CHF 0.5 million from the Chinese
government due to On having its APAC headquarters in Shanghai, China. CHF 0.4 million of the amount received is a
considered a one-off grant for costs related to the regional core management team. The remaining CHF 0.1 million of the
amount received is for costs related to office rental, and is the first of three office rental grants to be received by the
Chinese government for the first three consecutive years. In 2023, On received the second consecutive rental grant
amounting to CHF 0.1 million. Additionally, during 2023, the Chinese government provided further one-off grants
amounting to CHF 0.1 million relating to On's retail footprint and sales growth in Shanghai, China.
On did not benefit from any other form of government assistance.
In 2023, the income accrued from government grants is reported as a deduction from the related expenses and
amounts to CHF 1.5 million (2022: CHF 1.4 million, 2021: CHF 0.6 million).
Accounting policies On only recognizes government grants relating to income if it is reasonably certain that the
conditions attached to the grants will be fulfilled. The grants actually awarded are
recognized at their fair value. When the grant relates to an expense item, it is recognized as
income on a systematic basis over the periods that the related costs, for which it is
intended to compensate, are expensed. When the grant relates to an asset, it is recognized
as income in equal amounts over the expected useful life of the related asset.
6.7 Events after the balance sheet date

There were no material events after the balance sheet date.
F-57
Index to financial statements
Audited consolidated financial statements - On Holding AG
Report of the statutory auditor on the financial statements of On Holding AG for 2023
Financial statements of On Holding AG for 2023

Report of the statutory auditor
to the General Meeting of On Holding AG
Zurich
Report on the audit of the financial statements
Opinion
We have audited the financial statements of On Holding AG (the Company), which comprise the income statement for
the year then ended December 31, 2023, the balance sheet as at December 31, 2023 and notes to the financial state
ments, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements comply with Swiss law and the Company's articles of incorpora
tion.
Basis for opinion

We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH). Our responsibilities
under those provisions and standards are further described in the 'Auditor's responsibilities for the audit of the financial
statements' section of our report. We are independent of the Company in accordance with the provisions of Swiss law
and the requirements of the Swiss audit profession, and we have fulfilled our other ethical responsibilities in accordance
with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our audit approach
Materiality
The scope of our audit was influenced by our application of materiality. Our audit opinion aims to provide reasonable
assurance that the financial statements are free from material misstatement. Misstatements may arise due to fraud or
error. They are considered material if, individually or in aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of the financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall
materiality for the financial statements as a whole as set out in the table below. These, together with qualitative consider
ations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to
evaluate the effect of misstatements, both individually and in aggregate, on the financial statements as a whole.
Overall materiality CHF 5'100'000
Benchmark applied Total assets
Rationale for the materiality bench We chose total assets as the benchmark because, in our view, it is the bench
mark applied mark against which the performance a holding company is most commonly
measured and is a generally accepted benchmark for holding companies.
We agreed with the Audit Committee that we would report to them misstatements above CHF 255'000 identified during
our audit as well as any misstatements below that amount which, in our view, warranted reporting for qualitative reasons.
PricewaterhouseCoopers AG, Birchstrasse 160, Postfach, 8050 Ziirich, Switzerland

Telefon: +41 58 792 44 oo, www.pwc.ch
PricewaterhouseCoopers AG is a member of the global PricewaterhouseCoopers network of firms, each of which is a separate and independent legal entity.
Audit scope
We designed our audit by determining materiality and assessing the risks of material misstatement in the financial state-
ments. In particular, we considered where subjective judgements were made; for example, in respect of significant ac-
counting estimates that involved making assumptions and considering future events that are inherently uncertain. As in
all of our audits, we also addressed the risk of management override of internal controls, including among other matters
consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the financial
statements as a whole, taking into account the structure of the Company, the accounting processes and controls, and
the industry in which the Company operates.
Key audit matters

We have determined that there are no key audit matters to communicate in our report.
Other information
The Board of Directors is responsible for the other information. The other information comprises the information included
in the annual report, but does not include the financial statements, the consolidated financial statements, the remunera-
tion report and our auditor's reports thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assur-
ance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial statements or our knowledge ob-
tained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Board of Directors' responsibilities for the financial statements

The Board of Directors is responsible for the preparation of financial statements in accordance with the provisions of
Swiss law and the Company's articles of incorporation, and for such internal control as the Board of Directors determines
is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the Board of Directors is responsible for assessing the Company's ability to con-
tinue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no
realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from ma-
terial misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law and
SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic de-
cisions of users taken on the basis of these financial statements.
As part of an audit in accordance with Swiss law and SA-CH, we exercise professional judgement and maintain profes-
sional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, de-
sign and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropri-
ate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher

pwc
than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropri-
ate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's in-
ternal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and re-
lated disclosures made.
• Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence ob-
tained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease
to continue as a going concern.
We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
Report on other legal and regulatory requirements
In accordance with article 728a para. 1 item 3 CO and PS-CH 890, we confirm the existence of an internal control sys-
tem that has been designed, pursuant to the instructions of the Board of Directors, for the preparation of the financial
statements.
We further confirm that the proposed appropriation of available earnings complies with Swiss law and the Company's
articles of incorporation. We recommend that the financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Patrick Balkanyi Samuel Häring

Licensed audit expert Licensed audit ex
Auditor in charge
Zurich, March 12, 2024
Enclosures:
• Financial statements (income statement, balance sheet and notes)
• Proposed appropriation of retained earnings
-ER 4 On Holding AG 1 Report of the statutory auditor to the General Meeting

pwc
Income statement
in CHF Notes 2023 2022
Dividend income from shareholdings 13,000,000 7,000,000

Other intercompany sales 3,071,922 3,071,922
Gross profit 16,071,922 10,071,922
Share-based compensation -1,150,476 -1,106,604

General and administrative expenses 2.9 -12,455,273 -12,771,448
Other operating income and expenses -963,466 -45,415
Operating result 1,502,707 -3,851,545
Financial expenses -45,669,093 -280,630

Financial income 2.10 33,658,853 57,529,320
Income before taxes -10,507,533 53,397,145
Income taxes 614,558 -9,624,072

Income /(Loss) for the period -9,892,975 43,773,073
on.com 1
Balance sheet
in CHF Notes 12/31/23 12/31/22
Cash and cash equivalents 247,704,209 194,462,283

Other current operating assets 2.1 83,761,936 459,226,109
Current assets 331,466,144 653,688,392
Intangible assets 2.2 22,917,540 24,939,676

Other non-current financial assets 2.3 544,934,730 195,045,544
Investments 2.4 31,054,625 22,669,956
Non-current assets 598,906,895 242,655,176
Assets 930,373,040 896,343,568
Trade payables 2.5 461,886 733,251

Other current operating liabilities 2.6 47,337,454 38,588,444
Current provisions 81,277 -
Income tax liabilities 642,653 2,110,622
Current liabilities 48,523,270 41,432,317
Other non-current financial liabilities 2.7 37,425,862 -

Non-current liabilities 37,425,862 -
Share capital 33,454,188 33,454,188

Capital reserves 801,469,909 801,469,909
Reserves from capital contribution 790,987,121 790,987,121
Other capital reserves 10,482,788 10,482,788
Treasury Shares 2.8 -26,707,617 -26,113,247
Retained earnings 46'100'402 2'327'329
Income /(Loss) for the period -9,892,975 43,773,073
Equity 844,423,908 854,911,252
Liabilities and Equity 930,373,040 896,343,569
on.com 2
Notes to the financial statements
Notes to the financial statements 2023 in accordance with Article 959c of the Swiss Code of
Obligations (in CHF).
1. Accounting and valuation principles

Foreign currency positions
Transactions in foreign currencies are translated at the exchange rate that applied on the transaction
date. Exchange rate gains and losses resulting from such transactions or from the revaluation of
foreign currency assets and liabilities at the balance sheet date are recognized as financial income or
expenses. The average exchange rate used is the exchange rate published by the ESTV on a monthly
basis.
Currency 31.12.2023 31.12.2022
AUD 1 0.5732 0.6275

BRL 100 17.3241 17.6822
CAD 1 0.6335 0.6829
CNY 100 11.8545 13.2570
DKK 100 12.4597 13.2785
EUR 1 0.9289 0.9875
GBP 1 1.0716 1.1129
HDK 100 10.7747 -
JPY 100 0.5965 0.7012
KRW 100 0.0651 -
NOK 100 8.2738 9.3922
SEK 100 8.3442 -
USD 1 0.8414 0.9252
VND 10000 0.3500 0.3723
2. Other disclosures required by the law

Company information
On Holding AG, Zurich, Switzerland
The number of full-time positions over the year was not above 10 employees.
on.com 3
2.1 Other current operating assets
in CHF 31.12.2023 31.12.2022
From third parties 6'075'617 7'594'167

thereof accruals and prepaid expenses 6'075'617 7'594'167
From intercompany 77'686'319 451'631'942
Other current operating assets 83'761'936 459'226'109
2.2 Intangible assets
At the end of 2019, a “service, license and investment agreement” was negotiated between On and
a third party. The parties entered into an agreement under which On shall be granted the right to use
intangible assets in connection with the development, advertisement, promotion and sale of certain
products as well as promotional services by the third party against options to purchase On shares.
The number of exercisable options depends on the revenues of the fiscal years 2023 and 2024.
The decrease in Intangible assets of CHF 2’008k fully relates to amortization.
2.3 Other non-current financial assets
in CHF 31.12.2023 31.12.2022
From third parties - -

Other non-current financial assets 544'934'730 195'045'544
on.com 4
2.4 Shareholdings
in CHF 2023 2022

Entity Domicile Capital Share Capital Share
On AG Zurich, CH 986'520 100% 986'520 100%

On Brazil Ltda. Sao Paulo, BR 8'239'926 100% 255’818 100%
On Cloud Service GmbH Berlin, DE 29'214 100% 29'214 100%
On Clouds GmbH Zurich, CH 20'000 100% 20'000 100%
On Clouds Inc. Dover, US 18 100% 18 100%
On Europe AG Zurich, CH 100'000 100% 100'000 100%
On Hong Kong Ltd. Hong Kong, CN 117'036 100% 1'190 100%
On Inc. Portland, USA 18 100% 18 100%
On Italy S.r.l. Milan, IT 9'975 100% 9'975 100%
On Japan K.K. Yokohama, JP 1'855'666 100% 881'821 100%
On Oceania Pty Ltd. Docklands, AU 232'633 100% 232'633 100%
On Running Canada Inc. Vancouver, CA 157'583 100% 157'583 100%
On Running Sports Shanghai, CN 5'060'000 100% 5'060'000 100%
Products (Shanghai)
Company Ltd.
On Vietnam CompanyLtd. Ho Chi Minh,VN 248'400 100% 252’891 100%
Brunner Mettler GmbH Zurich, CH 20’000 100% 20’000 100%
On Running UK Ltd. London, UK 1 100% 1 100%
On South Korea South Korea,KR 271'600 100% - -
2.5 Trade payables
in CHF 31.12.2023 31.12.2022
From third parties 440'698 712'062

From intercompany 21'189 21'189
Trade payables 461'887 733'251
2.6 Other current operating liabilities
in CHF 31.12.2023 31.12.2022
From third parties 996'618 3'324'317

Other current operating liabilities 47'337'454 38'588'445
on.com 5
2.7 Other current operating liabilities
in CHF 31.12.2023 31.12.2022
From third parties - -

From intercompany 37'425'862 -
Other current operating liabilities 37'425'862 -
2.8 Treasury shares
in CHF Shares Paid Price Share Value

Price
Beginning Balance, 01.01. 18'021'738 26'113'247

Sale of Treasury Shares (2'271'253) 0.10 0.10 (227'125)
Purchase of Treasury Shares 32'363 25.38 25.38 821'495
Closing Balance, 31.12. 15'782'848 26'707'617
The Sale of Treasury Shares and the Purchase of Treasury Shares were made at the share market
value on the date of each transaction.
See also Note 2.9 on Financial Income.
The reserves from capital contribution are temporarily blocked for treasury shares (created out of KER
for the purpose of employee share-based compensation) in the amount of CHF 26’707’617 until the
shares are allocated.
2.9 General and administrative expenses
in CHF 2023 2022
Depreciation and amortization -2'022'136 -2'008'565

Personnel expenses General & Admin -440,536 -9,422
Other -9'992'602 -10'753'461
General and administrative expenses -12'455'273 -12'771'449
on.com 6
2.10 Financial income
As a public company, On Holding AG grants share-based compensation awards to the extended

founder team, other members of senior management and to certain other employees to incentivize
individuals based on their impact and contribution to On. In 2023 On Holding has realised a gain on
sale of Treasury Shares in the amount of CHF 9'923'590.02 with third parties (2022: CHF
25'929'003.79 with third parties).
The remaining Financial Income is resulting from Interest Income from Intercompany and third parties.
2.11 On Employee Participation Programs
Long Term Incentive Plan (LTIP)
A stock option program for the group executive team and selected employees of the On Group was
established in 2020 (LTIP 2020). Awards under the LTIP 2020 were granted as options. All options
under the LTIP 2020 met their full vesting requirements in connection with our successful IPO in
September 2021, which constituted an exit event.
The remaining outstanding awards under the LTIP 2020 are fully vested and exercisable. Vested
options may be exercised until the seventh anniversary of the contractual granting date.
A new stock option program for the group executive team and selected employees of the On Group
was established in 2021 (LTIP 2021). In March 2023, the LTIP 2021 was amended with the revised
vesting parameters described below.
Awards under the LTIP 2021 are granted as RSUs or Performance Stock Units (PSUs) and are subject
to time-based and in the case of PSUs additional performance-based vesting conditions.
Subject to a participant's continuous employment and unless otherwise agreed in a participant's

award agreement, 34% of RSUs granted vest on the first anniversary of the granting date; thereafter,
8.25% of the RSUs vest at the end of each quarter following the first anniversary of the granting date.
Any grant of PSUs is split equally between a two year performance cycle and a three year performance
cycle. Subject to a participant's continuous employment, the achievement of the performance
conditions as well as the resulting vesting factor and unless otherwise agreed in a participant's award
agreement, the PSUs vest in full 24 months following the grant date (for a two year performance cycle)
and 36 months following the granting date (for a three year performance cycle).
PSU grants to members of On's Executive Board are subject to a market-based award multiplier,
based on the achievement of On's total shareholder return relative to a broad market index measured
over the same two year and three year performance cycle.
Prior to the amendment in March 2023, grants were subject to time-based and in the case of PSUs
additional performance-based vesting conditions. Subject to the participant's continuous
employment and unless otherwise agreed in a participant's award agreement, 33 1/3% of the RSUs
granted were scheduled to vest on the grant date and on the first anniversary of the granting date,
respectively, so that the remaining 33 1/3% vest on the second anniversary of the grant. The PSUs
on.com 7
granted were scheduled to vest on the third anniversary of the grant date, subject to the achievement
of the performance conditions, measured over the performance cycle, and the resulting vesting factor.
Upon vesting, the awards are distributed to participants in the form of shares as soon as operationally
feasible.
Contingent assets and liabilities
Guarantees in the amount of CHF 700’000’000 (2022: CHF 100’000’000) were provided to third
parties. This includes the rolled in guarantee in the amount of CHF 155.3 million (December 31, 2022:
CHF 126.1 million) in favor of other third parties.
Liabilities to pension plan institutions
There are no liabilities towards pension plan institutions.
Events after balance sheet date
None.
on.com 8
Movement on retained earnings
in CHF 2023 2022
Profit carried forward at the beginning of the 46,100,402 2,327,327

year
Appropriations of retained earnings resolved by

general meeting
Dividends - -
Allocation to legal reserves - -
Profit / (Loss) for the period -9,892,975 43,773,075
Profit carried forward at the disposal of the 36,207,427 46,100,402

annual general meeting
Proposal of the board of directors for the appropriation of

retained earnings
in CHF 2023 2022
Profit carried forward at the disposal of the 36,207,427 46,100,402

annual general meeting
Gross dividend - -
Allocation to legal reserves - -
To be carried forward 36,207,427 46,100,402
on.com 9

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Exhibit 99.

Annual Report 2023

• Management report (Form 20-F)

• Consolidated financial statements of On Holding AG for 2023

• Financial statements of On Holding AG for 2023

For the fiscal year ended December 31, 2023

450 Lexington Avenue

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Securities registered or to be registered pursuant to Section 12(g) of the Act.

2023 Memorable Moments

On hosts its first Investor Day as a public company in Zurich, Switzerland.

The On team surpasses 2,000 team members globally.

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 16H. MINE SAFETY DISCLOSURE

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Trademarks and Trade Names

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

• our reliance on complex IT systems;

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 3. KEY INFORMATION

B. Capitalization and Indebtedness

C. Reason for the Offer and Use of Proceeds

Summary of Risk Factors

I. Risks Related to Our Business Industry and Economic Environment

II. Risks Related to Our Operations, Distribution Network and Suppliers

III. Risks Related to Our Intellectual Property and Information Technology

IV. Risks Related to Financial, Accounting and Tax Matters

V. Risks Related to Legal and Regulatory Compliance

I. Risks Related to Our Business, Industry and Economic Environment

(i) Brand resilience

(ii) Business strategy

(v) Economic, political and market conditions

An economic recession, depression, downturn, periods of inflation, or economic uncertainty may

II. Risks Related to Our Operations, Distribution Network and Suppliers

(i) Business operations

(ii) Supply-chain and distribution

(iii) Third-party partners and suppliers

(iv) Human capital

III. Risks Related to our Intellectual Property and Information Technology

(i) Protection of intellectual property and litigation

(ii) Information technology security, laws, and systems

IV. Risks Related to Financial, Accounting and Tax Matters

(i) Additional investments in our business

(ii) Financial reporting and internal controls

(iii) Foreign currency exchange rates

V. Risks Related to Legal and Regulatory Compliance

(i) Trade policies, tariffs and import/export regulations

(ii) Data protection laws

(iii) Legal or regulatory requirements, proceedings and audits

(i) Dual class structure of our shares

(ii) Foreign private issuer status

(iii) Pricing volatility, dividends, and dilution

(iv) Swiss corporate law

ITEM 4. INFORMATION ON THE COMPANY

Net Sales by Region

Americas Asia-Pacific EMEA

Europe, Middle East and Africa 488.7 378.1 264.3

The following table presents net sales by sales channels: