On Holding AG's stock plummeted 11.25% in pre-market trading on Tuesday following the release of its fourth quarter and full year 2025 financial results.

The Swiss sportswear company reported strong revenue growth with annual net sales surpassing CHF 3.0 billion for the first time, representing a 30.0% year-over-year increase. The company also achieved record profitability metrics with gross profit margin expanding to 62.8% and adjusted EBITDA margin reaching 18.8%.

However, investors reacted negatively to the decline in net income, which fell 15.9% to CHF 203.7 million for the full year and dropped 22.9% to CHF 69.1 million in the fourth quarter. The net income margin decreased to 6.8% from 10.4% year-over-year, with basic earnings per share declining to CHF 0.62 from CHF 0.75.

Despite providing confident guidance for 2026 with expected net sales growth of at least 23% on a constant currency basis, the market focused on the profitability challenges as the company continues to reinvest in brand building, innovation, and retail expansion.