In 2025, as the popularity of trail running events continues to rise, HOKA, dubbed the &#34;three treasures of the new middle class,&#34; is forced to face market scrutiny over its slowing growth.
According to the financial report for the period ending September 30, HOKA's net sales grew by 11.1%, reaching $634.1 million.
This means that after a brief return to over 20% growth in the previous quarter, the growth engine has once again shown signs of fatigue.
The market's unmet expectations for HOKA's growth are essentially a result of its own high growth inertia.
From fiscal year 2018 to 2024, HOKA's brand revenue increased from $150 million to $1.81 billion, with a six-year revenue CAGR of 51%, and its share of parent company Deckers Brands' revenue rose from 8% to 42%.
However, this once rapidly rising star brand is showing signs of slowing growth this year.
For the quarter ending March 31, its sales grew only 10% year-on-year, amounting to $586 million. In the three quarters prior, HOKA's net sales growth rates were 29.7%, 34.7%, and 23.7%, respectively.
In fact, the channel and brand dividends in China's outdoor sports market have not dissipated.
The gradual promotion of mass participation has shifted the core of outdoor competition from professional sponsorship at events to benchmark shopping malls in first-tier cities. Places like MixC, Taikoo Li, and Hang Lung have become important choices for sports brands to expand.
The growth logic of the &#34;new nobles,&#34; represented by HOKA, will undergo a shift: the importance of brand accumulation and channel efficiency will significantly increase.
<h2>New Nobles Slow Down</h2>
In comparison to On Holding AG, the pressure faced by HOKA appears more pronounced.
The two brands are closely aligned in terms of founding time, brand background, and entry into the Chinese market, both successfully &#34;breaking out&#34; through differentiated design and trendy aesthetics.
On Holding AG's growth has also slowed, but it maintained a growth rate of 37.2% in the first half of the year, with net sales in the Asia-Pacific region surging 114.8% year-on-year, reaching 240 million Swiss francs.
Changes in the market environment and channel structure are part of the reason for this disparity.
According to independent analyst Tang Xiaotang from No Agency, the uncertainty in the trade environment over the past few quarters, along with brands like Nike strengthening their partnerships with leading retailers, has impacted HOKA's wholesale channel performance. Although the Chinese market has not been affected by this factor, its contribution to global performance is limited, making it difficult to reverse the overall trend.
In contrast, On Holding AG has a more balanced channel structure—its direct sales account for about 40%, which is approximately 10 percentage points higher than HOKA's parent company Deckers.
Tang Xiaotang pointed out: &#34;One characteristic of relying on wholesale channels is that performance can fluctuate due to ordering cycles, which also explains why HOKA achieved 20% growth only in the last quarter.&#34;
Deckers, the parent company of HOKA, believes that consumer attitudes will become more cautious in the second half of the year and predicts that brand sales for the current fiscal year are expected to achieve low double-digit growth of 10%–15%.
The relatively conservative expectations are mainly due to tariff pressures and rising product prices in the U.S. market.
From a longer-term perspective, the slowdown in growth marks a shift in the brand's growth model.
The rapid growth of these &#34;new aristocrat&#34; brands in the past has benefited from differentiated design on one hand and the market vacuum left by strategic adjustments of industry giants on the other.
For example, around 2017, Nike and Adidas shifted to a DTC model and reduced cooperation with wholesale channels, which released development opportunities and shelf space for emerging brands like HOKA.
HOKA is characterized by its functional design with an ultra-thick midsole and is seen as having precisely captured the &#34;ugly shoe&#34; trend that emerged in recent years. Due to its pricing being higher than similar products from mainstream brands, it successfully occupies a blank price range.
UBS analysts point out that expanding the apparel category, increasing the proportion of direct sales channels, and deepening the layout in the Asia-Pacific market are potential future development directions for HOKA.
However, Tang Xiaotang expressed to Xinfeng that a diversified strategy needs to be viewed dialectically, &#34;Overemphasizing category breakthroughs may imply concerns about the sustainability of a single category. In fact, the running shoe category itself is still in a phase of rapid penetration increase.&#34;
As the largest segment in functional sports shoes, the overall market environment for running shoes continues to improve, and the trail running segment that HOKA focuses on remains active.
In 2024, the number of various trail running events held and planned in China has reached 505, compared to just 65 a decade ago.
In this process, HOKA has established a significant first-mover advantage.
As one of the international brands that bet early on the Chinese trail running market, HOKA established the &#34;HOKA ONE ONE China Elite Team&#34; in its second year in the Chinese market, actively laying out professional event resources.
In 2024, among the brands of running shoes worn by runners in all categories of trail running events, the top three in market share are Kailas FUGA, HOKA, and Salomon, with the three collectively accounting for over 80% of the wearing rate share.
However, among the &#34;three treasures of the new middle class&#34;—HOKA, On Holding AG, and Salomon—HOKA is considered to be the slowest in terms of fashion.
On Holding AG has collaborated with LOEWE five times, launching dozens of apparel series, injecting high-end fashion genes into the brand while vigorously expanding the clothing category; Salomon has also collaborated with seasoned players in trendy operations, continuously strengthening its market presence.
In a recent earnings call, Deckers Brands President and CEO Stefano Caroti revealed HOKA's future product direction: the brand will focus on five major scenarios: running, trail running, hiking, fitness, and lifestyle, and accelerate the development of the apparel category to build new growth momentum
The Chinese market will undoubtedly be at the core of growth strategies.
<h2>From the Arena to the Marketplace</h2>
The key to breaking through the ceiling and maintaining high growth for segmented brands lies in continuous &#34;breaking the circle,&#34; expanding into broader scenarios, categories, and channels.
Among the many methods of breaking the circle, iconic flagship stores are one of the most visible and directly impactful exposure methods.
In the past year, HOKA has continuously strengthened its strategic layout through direct-operated stores, deeply cultivating four core cities: Shanghai, Beijing, Chengdu, and Shenzhen, while radiating to the East China, North China, Southwest, and South China regional markets.
In May this year, HOKA unveiled the world's largest brand experience center in Shanghai, spanning three floors and approximately 1,600 square meters, becoming its largest store to date; in August, Beijing welcomed the world's first independent pop-up store for the MAFATE series, while the Chengdu concept store was also refreshed simultaneously; in September, the first brand concept store in South China officially opened in Shenzhen.
Currently, HOKA's number of stores in China has surpassed that of any other market globally.
The existing 28 direct-operated stores are all located in five key cities: Beijing, Shanghai, Guangzhou, Shenzhen, and Suzhou, with Beijing and Shanghai accounting for more than half.
HOKA is not an isolated case. &#34;All brands aspiring to grow in China are focusing on DTC,&#34; Tang Xiaotang pointed out to Xinfeng.
According to Du Bin, Secretary-General of the Brand Professional Committee of the Shanghai Shopping Center Association, outdoor sports brands have accelerated their entry into the first floor of shopping malls around 2023, taking over prime locations previously occupied by fast fashion and beauty stores.
Research by the First Pacific Davis Research Department on sample shopping centers in Shanghai shows that by June 2025, the share of sports and outdoor brands in the overall retail format will reach 10%, an increase of 1.1 percentage points compared to the same period last year.
The structure of channels and consumer logic in the Chinese outdoor sports market differs significantly from overseas.
On Holding AG CEO Martin Hoffman has pointed out that in many countries, On has a strong high-end wholesale distribution network, with core retail partners like Foot Locker and JD Sports in the United States. However, this model does not exist in China.
In terms of target demographics and consumption motivations, the Chinese market also exhibits distinct characteristics.
Yangtze Securities analyst Yu Xuhui believes that current mass consumption is diverging into two main directions: &#34;high cost-performance&#34; and &#34;high quality,&#34; with consumers more inclined to choose brands that can represent their &#34;self-label.&#34; Sports products have become an important carrier for the middle class to express their lifestyle and value propositions.
For mid-to-high-end positioned outdoor brands, stores and experience spaces not only serve sales functions but also play a crucial role in supporting the brand's high-end positioning and continuously consolidating and enhancing brand influence in public perception.
Currently, this direction has received a positive response from the channel side.
Du Bin told Xinfeng that when mid-to-high-end malls select outdoor sports brands, the primary consideration is the match between brand pricing and their own positioning, and when multiple brands compete for the same location, brand awareness or traffic becomes the core decision-making basis
&#34;There are currently limited outdoor brands with high market recognition,&#34; said Du Bin. &#34;Shopping malls usually hope to gather them as much as possible, and it would be better to introduce Salomon, On Holding AG, and HOKA at the same time.&#34;
In a broader region, HOKA is also expanding its stores through partnerships with agents and distributors.
For example, HOKA chose to collaborate with the largest sports retail company in China, Tmall Sports, in 2023 to establish cooperative stores in second-tier markets like Qingdao.
However, as all brands are ramping up the establishment of large experience stores, the &#34;experience&#34; content of the space must continuously innovate to attract consumers to visit repeatedly. Otherwise, the substantial initial investment could create new pressures.
On Holding AG, which is also rapidly opening stores and actively marketing in the Chinese market, saw its net profit drop by 87% year-on-year in the first half of the year, with its net profit margin falling from 14% to 1.1%.
In addition to the officially disclosed foreign exchange loss factors, the market also believes that the persistently high store costs and rapidly increasing marketing expenses have begun to drag down On Holding AG's profitability efficiency.
After all, opening stores is just a means; what ultimately supports the long-term healthy operation of stores is sustained foot traffic and repurchase rates.
Nowadays, market trends are shifting from outdoor trail running to urban road running, and running shoe brands centered around the middle class will face direct competition in a broader range of scenarios. The dimensions of competition are continuously expanding, and brand strength, product adaptability, and user loyalty will all be put to the test.
The competition point between HOKA and middle-class running shoes may have already arrived.
Risk Warning and Disclaimer
The market has risks, and investment should be cautious. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial conditions, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Investing based on this is at one's own risk

ONON

HOKA faces a slowdown in market growth in 2025. Although the financial report for the period ending September 30 shows a net sales increase of 11.1%, reaching USD 634.1 million, the growth rate has shown signs of fatigue. Brand revenue increased from USD 150 million in 2018 to USD 1.81 billion in 2024, with a CAGR of 51%. Compared to its competitor On Holding AG, HOKA's growth rate has slowed more significantly, with changes in the market environment and channel structure being the main reasons. Analysts point out that brand consolidation and channel efficiency will become increasingly important

- In 2025, HOKA faces slowing growth despite a net sales increase of 11.1%, reaching $634.1 million, following a brief surge above 20%.  
- The brand's rapid rise from $150 million to $1.81 billion in revenue from 2018 to 2024 is now challenged by market saturation and increased competition, particularly from brands like ANTA.  
- HOKA's future strategy includes expanding its apparel line and enhancing direct-to-consumer channels, with a focus on the Chinese market, where outdoor running events have surged significantly.

The Speed Reduction Metaphor of HOKA: How "Middle-Class Running Shoes" Transitioned from the Track to the Mall