Please, gentlemen, thank you for standing by. Welcome and thank you for joining the On Holding AG Q1 2022 results. Throughout today's call, all participants will be in a listen-only mode. Presentation will be followed by a question-and-answer session. If you would like to ask a question, you may press star followed by one on your touch tone telephone to register for questions. Please press the star key followed by zero for operator assistance. I would now like to turn the conference over to Florian Maag, Head of IR. Please go ahead. Good afternoon, good morning, and thank you for joining On's 2022 Q1 earnings conference call and webcast. With me today on the call are Executive Co-Chairman and Co-Founder, Caspar Coppetti, CFO and Co-CEO, Martin Hoffmann, and Co-CEO, Marc Maurer. For the first part, Caspar and Martin will lead through the prepared statements. Afterwards, we are looking forward to opening the call for a Q&A session. Before we begin, I would like to remind everyone that the remarks during today's call may contain forward-looking statements regarding future events and financial performance within the meaning of the federal securities laws. These forward-looking statements reflect our current expectations and beliefs only, and such statements are subject to certain risks and uncertainties that could cause actual results to differ materially. Please refer to our 20-F file with the Securities and Exchange Commission on 18 March for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Please further note that this call will also contain certain non-IFRS financial measures such as adjusted EBITDA and adjusted EBITDA margin. While the company believes these non-IFRS financial measures will provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS. Please refer to today's release for a reconciliation of non-IFRS financial measures to the most comparable measures prepared in accordance with IFRS. With that, I will turn the call over first to Caspar, followed by Martin for the prepared remarks. A warm welcome from my side as well, and thank you for joining our call today. We are happy to report that On had an excellent start into the year and that we were able to further build on the momentum from last year. With CHF 236 million of net sales, a growth of 68% versus Q1 2021, we have exceeded even our own high expectations. As anticipated, Q1 was still constrained by the supply shortages that have been affecting our industry. Our teams along the supply chain have done a phenomenal job in navigating the challenges, helping us to reach yet another record quarter. Let's have a look at some of the key takeaways from this quarter. On is winning market share at an accelerated pace. The combination of very strong consumer demand for the On brand and better than anticipated supply led to significant market share gains in our key markets. On aims to be the number one brand on runner's feet, and the accelerated pace of market share gains mean that we are making good progress towards this goal. On's new products are resonating with customers. In spring 2022, On has launched a number of key new running styles that are already seeing significant traction with consumers, both online and with our retail partners. In March, we introduced the Cloudmonster, which is On's most cushioned model to date. Sales on our e-commerce platform during launch week were the second-largest in history, only behind the launch of THE ROGER Centre Court. In April, the first consumers were able to buy the long-anticipated Cloudrunner, which at $140 offers mid-level cushioning and support and reaches a very wide audience of runners. The Zero Jacket underlines our ambition to expand our apparel business. As the name suggests, it weighs close to nothing and is, to our knowledge, the lightest running jacket on the market today. With these and other products such as the Cloudgo coming later this year, we expect to continue winning market share in all key markets. This quarter also saw On's biggest launch in history with the Cloud 5, On's flagship product in the performance all-day category. This launch not only led to extremely strong e-commerce revenues, thanks to many repeat customers, but because the Cloud 5 is made of more than 40% recycled content overall, which is an industry best, the environment also benefits. This confirms our belief that more sustainable products need to and can be applied at scale. On sees continued strong growth across all continents and in both wholesale and D2C. One aspect that sets On apart is that we have strong high-growth multi-channel businesses in the major markets of each continent. To illustrate this, I'd like to call out some examples. Our US business grew 87% versus Q1 2021. UK and Germany grew 54% and 49% respectively, while China and Japan were up 178% and 148%. In all of these markets, we are far from maturity nor saturation, as many consumers are either just learning about On or might have purchased their first piece. Those that have already purchased in 2021 are coming back to buy more, both in our own channels and with our trusted retail partners. On is doubling down on performance technology. From the beginning, On has been focused on delivering innovation that will drive performance for the world's best athletes. In that spirit, let us introduce you to On's Lightning Program, something that we have not spoken about publicly before. The Lightning Program consists of around 20 engineers, sports scientists, material specialists, and coaches who focus on one mission only, how to make the fastest products possible and to work extremely closely with some of the most talented runners to unleash their full potential. In the past months, we have seen some very encouraging results coming from the Lightning Program. In Istanbul, at the end of March, 10K world champion and On Athletics Club member Hellen Obiri toed the line for her first-ever half-marathon race. On her feet was a prototype racing shoe that she had only received the day before. When she crossed the finish line, she had won the race in the tenth fastest half-marathon time on record, despite the conditions being far from optimal. Just two weeks later, the same prototypes helped Tadesse Abraham win the Zurich Marató with a new course record and also Swiss record. To put things into perspective, Abraham will turn 40 this summer. This goes to show that the On labs are continuing to innovate at the highest level, and there's more to come. We are excited to announce that On will introduce a new cushioning technology in spring 2023 called CloudTec Phase. This evolution of On's existing technology was generated completely by computers using advanced finite element analysis simulation, a computerized method for predicting how a product reacts to real-world forces, which is pioneered in Formula One racing and by NASA, for example. We have been showing this technology to On's retail partners over the last weeks as part of spring 2023 sell-in, and the feedback is very encouraging. We are reaffirming On's premium positioning through premium prices. In showcasing the spring 2023 collection, On has also announced to our retail partners that we will adjust prices across all product ranges and geographies to reaffirm On's premium positioning. This step builds on the selective price increases that we have made in the US for 2022 Q1, which have not slowed down our strong growth in the States during this period. On has always regarded pricing as a brand positioning tool, and we are using this opportunity to defend On's premium positioning as other brands are also increasing prices. This puts On in a strong position to not only absorb some of the expected higher costs in the face of globally rising inflation, but to also reflect inflation on, in our own 2023 salary rounds as an important retention driver within our teams. On is strengthening our board of directors. As a public company, we aim to constantly strengthen our team and level of professionalism. We are therefore proud that Dennis Durkin, formerly with Activision Blizzard and Microsoft, stands for election for our board of directors at the upcoming annual general meeting. If elected, Dennis will take the chair of the audit committee, and with him, as well as with Alex Perez, On will have fully independent and highly experienced audit committee. If elected, the nomination and compensation committee will be further elevated with Amy Banse. We are currently also looking into opportunities to further strengthen and diversify our board over time. In closing, Q1 was an incredible start to the year for On. Like a four-lap mile race, it is always important to get out of the starting blocks strong and with good momentum, and our teams really did that and more in Q1. We have added new products, brought on incredible team members and capabilities, and achieved new sales records. I'm really proud of the team's work, but we know we can run even faster. We remain fully focused on pursuing excellence and driving innovation in all parts of our business. I'll now pass the baton over to Martin to cover our financial highlights and our increased outlook for the year. Thank you, Caspar. As you mentioned, net sales for the Q1 of CHF 235.7 million and a strong net sales growth of 67.9% were well above our plan. They represent so much more than just financial success or the continued strong demand that we see for the On brand globally. They stand for an exceptional effort by our whole team from operations to sales to happiness delivery to master the impacts from the challenging supply chain and factory closures last year. They stand for our ability to air freight the right products into the right warehouse and to efficiently manage the order book. The numbers stand for the flexibility and understanding we have experienced from our retail partners and direct-to-consumer customers. All together makes us extremely grateful and proud. Even with these great numbers, our supply shortage had still limited our ability to fulfill demand. For some products, the gap between demand and supply even widened during the quarter as a result of the strong feedback from our fans. At the same time, we were able to provide more of our new products to our customers than anticipated. Q1 2022 has been the strongest quarter in the history of On. In March, we generated our highest ever monthly net sales, and for the first time, we shipped more than 1 million pairs of shoes in a single month. Both of our channels, wholesale and D2C, grew at the same strong growth rate of 68%. As discussed in our Q4 earnings call, we have permanently shifted the launch of our spring/summer footwear collection from Q4 into Q1, which drives part of the wholesale growth and the catch-up effect versus what had been a slightly lower wholesale growth in Q4 2021. Combining Q4 and Q1, our wholesale channel grew by 54.5% versus the same time frame of the previous year. Our D2C share in Q1 remained high at 35.4%, despite we had seen continued lockdowns in Q1 2021, especially in Germany, Austria, and Switzerland. In North America and China, D2C continued to outgrow wholesales. We have additionally expanded our own retail store footprint, and we are extremely proud about our first Tokyo flagship store. The 320 sq m store is located on the high street of Cat Street and reflects our most advanced store concept. We have seen a very high level of interest in the store since the grand opening on 8 April. Sales on the first open Saturday reached a level of a very good weekend day in our New York City store, despite the usual logistical challenges on opening days in the new store. In addition, On Tokyo in April reached an apparel share of around 20%, much like what we have seen in our China stores, which is significantly above our overall corporate apparel share and bodes well for the opportunity we have in apparel in the rest of the world with a broader assortment and merchandising. Looking at our net sales split by geography, we have also seen strong growth across all regions. After a softer Q4, Europe returned to growth and net sales grew by 31.3% to CHF 74.9 million. North America continued to outgrow the group and we saw another exceptionally strong quarter with net sales increasing 86.5% to CHF 138.4 million. Asia Pacific net sales grew to CHF 16.4 million, more than doubling year-over-year with a growth rate of 125.9%. Both China and Japan grew very strongly. The latest COVID lockdowns caused repeated store closures in Q1 in China, and we expect more headwind there in Q2, which we will discuss later as part of our full year outlook. Finally, 219.2% growth in rest of world gives us a lot of confidence in the additional runway in countries outside of Europe, North America, and APAC. We are proud to announce that starting with fall/winter 2022, we will expand our presence in Latin America to most countries, including Chile, Argentina, Colombia, Peru, Uruguay, and Bolivia. While we continue to sell our products directly in Brazil, all other markets in the region will be served by new distributors. As Caspar already mentioned, Q1 has seen a fireworks of new key products, including the new Cloud, Cloudmonster, Cloudrunner, and Cloudvista. In addition, we continue to see strong sales growth with most of our running blockbusters like the Cloudflow, Cloudflyer, or the Cloudstratus, but also with our performance all-day franchises like the Cloudnova. Overall net sales from shoes grew 69% to CHF 222.5 million. Net sales for apparel grew 44.9% to CHF 11.4 million. Compared to Q1 2021, we had fewer new product launches and focused most of the brand messages on our new footwear products. Vendor sales continues to grow strongly in key accounts across all regions. With more new products coming in Q2, we expect continued strong growth rates in apparel as we attach better to our loyal shoe customer base. We are also planning a second drop of our super limited collection in partnership with Loewe later in the year, following the large success we saw with the initial drop. Based on more than 120,000 socks and more than 20,000 caps that we sold in Q1, accessories more than doubled year over year with a growth rate of 111.8%. Gross profit in the first quarter 2022 was CHF 122.1 million, compared to CHF 80.8 million in the previous year period. As expected, as a result of the strategic decision to use air freight to ensure key product availabilities and to meet the continued strong demand despite the factory closures in Vietnam last year, our gross profit margin decreased year-over-year from 57.6% to 51.8% in Q1 2022. Without the additional air freight exposure, and in spite of other inflationary pressures that we managed, we would have reached a gross profit margin close to our long-term guidance of 60%. We continue to invest in all parts of the business while still delivering profitability despite significant air freight costs. Excluding share-based compensation, SG&A expenses as a percentage of net sales were 49.1% in Q1 2022 compared to 47.2% in the previous year period. 185 people had their first day at On in Q1 2022, and we continued investing into brand building and sports marketing. A highlight was On's presence as the official sports and footwear partner at the legendary Penn Relays, the world's largest and longest running track meeting. Travel post-COVID increased as our team is back on the road to catch up on building personal relationships with our customers and partners. With China and Brazil, we have taken the last two markets live in our new ERP system, and now every business process globally runs on the same strong IT platform. In the future, this will allow us to further innovate and disrupt the way we're doing business, to build more multichannel capabilities and to connect stronger with our customers by using our intelligent data backbone. Moving on to share-based compensation. The expenses for Q1 2022 fell to CHF 3 million from CHF 25.5 million in the prior year period. This reduction was a result of the fact that the vast majority of our previously granted share-based awards had vested in Q4 of last year, while the majority of the 2022 share-based awards are only expected to be granted in Q4 this year. Despite the investment in air freight as well as the higher but controlled SG&A expense, we maintained a positive adjusted EBITDA of CHF 15.7 million for the first three months, slightly down from CHF 19.9 million in the prior year period. The adjusted EBITDA margin decreased from 14.2% to 6.7%. Net of the transient air freight cost, we would have seen a margin slightly above last year's number. Moving to our balance sheet. Our capital expenditure for the quarter was CHF 16.3 million and 6.9% of net sales, which continues to be driven by investments in our IT infrastructure, retail stores, as well as our office infrastructure, especially our new offices in Portland and Zurich. We ended the quarter with CHF 600.4 million net cash, a slight reduction from CHF 653.1 million at the end of 2021. The main driver of this being, of course, the continued increase in net working capital by CHF 57.5 million to support our high-growth business. Now let's look ahead. We're still super energized from the global meeting that we had last week, where we showed our new products for spring/summer 2023 to our full team. Especially in Europe, this was the first moment since November 2019 when everyone came back together physically. The amount of passion in the whole team was contagious and will be what our retailers will experience in the upcoming selling season. As Caspar mentioned, 2022 is far from being over. We are incredibly excited of what is ahead of us. This includes groundbreaking innovations on sustainability with the first shipments of the Cloudneo to go out to subscribers of our Cyclon program in the coming weeks. It includes many athletes that will compete in On gear on the big stages throughout the upcoming summer months. This includes even more exciting products such as the Cloudgo and new apparel items as an additional expansion of our running range on our quest to be the number one brand on runners' feet and bodies. While our teams around the world are returning to the offices, our colleagues in China, especially in our APAC office in Shanghai, are suffering from the COVID situation in their country. Also, our local business is strongly impacted. Due to the relatively small net sales share of China, we do not expect a significant impact on our top and bottom line. Despite the small impact, we want to provide some additional details. Our warehouse has been closed since 31 March, and we are not able to ship products to our wholesale partners, our own retail stores, and e-com customers. However, as of two days ago, local authorities have whitelisted our warehouse operations, and we expect to resume operations soon. While our four stores in Shanghai and one store in Beijing are closed, all other locations have mostly been open but negatively impacted from missing inventory refills. We also expect delay openings of some of our planned new own retail locations caused by the inability of our team to travel. Important to our business is that until today, we have not experienced any impact on production as all our factories, especially for apparel, are outside of the affected regions. The strong Q1 results are a good start to more than achieve our growth aspirations for 2022. The success of new product launches, the feedback we are receiving from the retail channels, the strength of our supply chain, as well as last but certainly not least, the passion of our team put us in a strong position today. Despite the global economy, macro uncertainties, and the situation in China, we are confident in our ability to execute and are once again increasing our outlook for 2022. We now expect net sales to reach at least CHF 1.04 billion, reflecting a 44% full year growth. This is an increase of CHF 50 million versus our prior outlook. To be in a position to reach this groundbreaking hurdle of CHF 1 billion in sales makes us extremely proud but also hungry to serve even more customers. Our internal ambition remains higher than that, as announced in our previous calls, we will continue using airfreight in Q2 to further balance inventory levels as we try to meet the strong demand we are seeing. We still expect the gross margin impact from these investments in airfreight in half year one 2022 to be in the range of 700 basis points to 800 basis points, meaning we anticipate a more modest margin impact in Q2 compared to Q1. The higher net sales will allow additional growth-focused investments into the brand and the team while increasing our adjusted EBITDA target for the full year to CHF 137 million and also increasing our goal of an adjusted EBITDA margin to 13.2%. If we are able to achieve higher net sales, we expect to drive additional absolute profitability. Both our top and bottom line are benefiting from the stronger momentum we are seeing across the business. As mentioned in the beginning, our team has done a phenomenal work during these challenging times and has delivered results above our own expectations. We would like to say thank you for all the hard work and the daily passion that goes into the pursuit of our joint dream. It is such an inspiration to work with this team, and I can't wait to welcome all in our new On Labs, as we will call our new offices in Zurich in June this year. In summary, Q1 was a great start to the year, and we are excited about the remaining laps in our race ahead of us in 2022. Remain laser-focused on innovation and disruption, on world-class execution and building an incredible team. As we say, dream on. With that, Caspar, Marc, Florian, and I would like to open up the session to your questions. Thank you again for your ongoing support in 2022. Unmute entry. We are ready to begin the Q&A session. Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star followed by two. If you're using speaker equipment today, please lift the handset before making your selections. Anyone who has a question may press star followed by one at this time. One moment for the first question, please. First question is from the line of Jonathan Komp from Baird. Please go ahead. Yeah. Hi, thank you. I wanna start by following up on the point you made about accelerating market share. I'm curious what you think are the main drivers when you look at the business and some of the improvements in brand awareness, the product innovation, the internal execution or any other factors that you think are the biggest drivers of the market share trends you're seeing? Thank you, Jonathan, for your question. I think it's, you know the space, very well. I think it's a combination of factors. First of all, we're just gaining traction in the major geographies. In 2021 most US customers or consumers probably heard of On for the very first time in their lives through the IPO or through a friend that has a pair of On. They're either getting a second pair, they're talking to their friends. This is a very grassroots driven uptake of the brand. At the same time, there are now more options available from On that compete with some of the best-selling styles from other brands. This combination of having a relevant product and then having a brand that you're interested is extremely powerful. This market share gain comes mostly from penetrating our existing channels more and gaining market share there. Great. When you look forward at the initiatives that you have in the pipeline, what gets you most excited about the ability to keep driving the performance you're seeing? I think, you know, when we're looking ahead, first of all, we have new products. We just launched the Cloudmonster and Cloudvista, which we said before, and they're resonating super well. More consumers will discover those products. We're very excited about that. On top of that, we're launching the Cloudgo, and this summer we're relaunching the Cloudflyer. We have additions on the Roger with the mid-top, additions on the Nova. There were lots coming there. Very strong lineup from a product perspective. I feel the topic of sustainability is just so important to us, and it's important to our consumers, and we see that it resonates. We spoke about the Cloudneo, but we also spoke about how all of our products are, you know, are increasing the recycled material share and that resonates with consumers. We have and we're adding channels. We're expanding doors in many geographies. You know, we spoke about how the performance run core, and we were able to elevate that with our lightning initiative and consumers are discovering that more and more. We really feel we have so many aspects coming together from product and brand and distribution perspective, and that's what really excites us for the next six to 12 months. Yeah. Great. Just one last one for Martin. If I could follow up on the gross margin performance. It looks like you offset a fair amount of the freight pressure that you saw in the Q1, maybe 200 basis points or more. I'm curious what drove some of the positive offsets to the freight. When you think about the path back to the long-term target of 60% gross margin, how should we think about the timing to get there, especially given some of the comments Caspar made about pricing and using that as a strategic lever? Thank you. Yeah. Very happy. I think we spent exactly what we were planning to spend on air freight. We were much more efficient and this is really thanks to the team that has done this great job in converting the product that we flew directly into sales and really bringing the right product into the right warehouse at the right time. This has led to a higher net sales number than what we had expected. Therefore, you see that in the end this relative impact from the air freight is lower than what we had to or based on the lower revenue number. For the second quarter, we will still fly, but it will be a less absolute amount, and therefore the impact will be lower. We expect that as of the third quarter we will be able to come down to a normal air freight share that we have also seen in the past. I think it's very important that really the impact that we have seen on gross margin is coming from air freight. If we take this out, we would have been at about 60%, so in line with our long-term goal. Then the price increases that Caspar mentioned, they will put us in the position, then also to react in 2023 on potential increases that we may see on the supply chain, on sourcing, but also in our cost, and also be able to react on the salary side, which of course is super important. This is the situation on the gross margin. Great. Thank you again. Next question is from the line of Cristina Fernández from Telsey. Please go ahead. Hi. Good morning. I wanted to follow up on the upside in the Q1 to say I'll send your comments about, being able to deliver more products. Is it fair to say that perhaps on the wholesale side or maybe on both channels, there was a little bit of a pull forward to the Q1 from the Q2 relative to your prior expectations? There's a very little timing effect in here. The majority of the upside really comes from the ability to work with our retail partners in order to ship the product that we had in the warehouse, and then also to really plan very efficiently what products we are flying. We've also seen, especially on the Cloud where we launched the new Cloud 5, that we were able to continue selling a lot of the Cloud 3, and we kept that at full price also on our website, which added to the Cloud 5 sales and therefore, in total, we're able to convert more of the demand into actual sales. Okay, thank you. As a follow-up, any change in consumer sentiment or anything you can point out, you know, by region as you know look at, you know, sort of demand in Europe versus the US, you know, based on the macro conditions to what you had seen on the last call? No, we don't really observe that. Also, when we're looking into the pre-orders for spring/summer 2023 that we're writing right now. I think we're also playing in a category that is very resilient. You know, it's about movement. That definitely helps us. Again, you know, we are not in the incremental game of plus/minus a few percentages. We really feel that we can continue to gain a lot of market share. We feel the brands that have strongest demand are in the best position over the next two to three years, and that's what we're observing. I think here I also want to point out that, for example, in a market like Japan, where we had a little bit slower growth rates over the last two years, we're seeing that with the store opening that we had with additional investments in the brand, you know, now posting 148% growth, I think shows that this consumer sentiment is global, and it's not bound to one specific market. Thank you. Next question is from the line of Michael Binetti from Credit Suisse. Please go ahead. Hey, guys. Thanks. Congrats on a really nice quarter. I know I even focused on Q1 for a long time since the Vietnam issues, so nice to see it. A couple from us. I guess on the gross margin, I think you said you'd be at 60% right now, excluding the freight headwinds, and that was the long-term goal. I mean, does that imply the underlying margins in the businesses are now parity with where you saw them? It seems longer term, there should still be some, you know, channel mix advantages, et cetera. Or do you think there's an opportunity to kinda relook at that long-term target as you guys work through the freight situation right now? I feel that the 60% is still the right number to look at. I think we all need to learn how inflation will play into this. As mentioned, I think we take this very proactively by adjusting the prices. We'll be in the position to digest higher cost service without a negative margin impact, which I think is super important. I think we need to monitor the freight costs, both shipping and ocean and air freight, and then see where this goes. If there's a slowdown in economy, the rates may become better, otherwise they may stay where they are. We feel there are many uncertainties. The 60% is something that we have proven that this is realistic in a non-challenged environment. But I wouldn't go higher at the moment. Okay. If I could follow that, I guess, on the OpEx or SG&A plan for the year, maybe how that's changed since the last update. I think you said gross margin beat by about eight or about 800 basis points of air freight. You said without the air freight, EBITDA margin would have been up about the same 800. It seems like you. I think in the prepared remarks, you said you reinvested some of the revenue upside in Q1, but commented that the rest of the year maybe you would flow through more of the upside to at a higher rate to EBITDA. If I got that right, can you speak to what you reinvested in in Q1? Why not continue to plow back any upside through the year given, you know, such strong long-term growth opportunities that we're seeing quarter to quarter here? Yeah. I think what you see in the numbers is that we very cautiously manage our cost side in order to digest part of the additional air freight in order to achieve a positive EBITDA, which was super important for us. At the same time, continued investing into the business. We didn't slow down on hiring. We were talking about travel investing in IT, completing our ERP project, also strengthening our distribution network. If you look at the marketing line with 12%, this is certainly where we would see additional investments if we overachieve and be able to achieve higher net sales than where we currently guide. This would be the line where we would clearly invest more into brand building and in upper funnel customer acquisition in strategic fields of the business. While, as I said, especially On hiring the right talent to maintain the growth and to secure the growth in the future has not slowed down and penalized by the air freight. Okay. Very thoughtful. Thanks, guys. Next question is from the line of Jim Duffy from Stifel. Please go ahead. Well, thank you. A great quarter. Demand strength very evident in the numbers. Guys, the inventory is still super tight, however. Can you speak more about plans to scale capacity? Are there any notable bottlenecks to growth through the remainder of 2022? Are you seeing any impact to material or component supply resulting from the China lockdowns? Could you speak about plans to scale capacity into 2023 to both ensure supply but also manage risk? Thank you. Let's start with basically the material situation. What we've done over the last years is basically we are dual sourcing all major materials, and we've localized it. We basically have one material supplier that is in China. You know, a huge one, so we're not seeing a negative impact from that, and we're quite confident on that. On the capacity side, you know, over the last years we've invested a lot in building capacity with our key partners. I was just in Vietnam, where we opened a new factory that has the capability to produce 13 million pairs a year, and it's gonna go live next spring. We're very confident that the capacity situation for apparel and footwear for the next years to come. As you know, we're working with some of the biggest partners like Dean Shoes or Huali. You know, I think the results that you're seeing now in Q1 also is a testament to how much they believe in On and how they're prioritizing On because they feel we can build something very big in the long term. You know, to add to Martin's point on the freight side. What we're definitely seeing is that a lot of capacity has been built and is being built because demand was very, very strong. Now, you know, with kind of some recession potentially looming in the US, we'll see how that impacts the whole industry. I'm not worried with On. We feel that On is a very, very strong brand in that game. Again, we feel that we can gain a lot of market share, and we're very confident that there is enough capacity available. Thank you. Next question is from the line of Jay Sole from UBS. Please go ahead. Great. Thank you so much. I wanna ask about, you know, the 87% growth in North America. Obviously, you know, tremendous growth. Can you maybe just talk to where you're seeing that growth come from? Is it new retail partners? Is it, you know, more doors with your existing partners, more shelf space with your existing retail partners? And maybe talk a little bit about how you're seeing the DTC business develop in North America. That'd be helpful. Thank you so much. Yes. Thank you, Jay. Good news, it's coming from everywhere. Let me give you a few examples. B2C grew very strong over proportionally in the US It was a very strong quarter, and I think what is especially important for us, it was a successful quarter at very high efficiency. We didn't need to spend a lot of money to get that volume which speaks to the brand strength. We basically had our, you know, higher ROAS than we had last year on the B2C side. Then when you look at retail, yes, we're increasing market share in existing channels. Let me give you an example from Fleet Feet. We had 8% market share by the end of last year, and now we're standing at 13%. This is existing door growth. We also added doors. We spoke about Foot Locker. We spoke about JD. You know, basically, we're at 94 JD doors now, and we are at 68 Foot Locker doors. That's additional doors that we're adding. The product is resonating with the consumers. The sell-through is very, very strong. We really, across the board, across all channels, very, very positive momentum. Got it. Thank you so much. Next question is from the line of Kimberly Greenberger from Morgan Stanley. Please go ahead. Great. Hey, everyone. This is Alex Straton for Kimberly Greenberger. Thanks so much for taking the question. I just wanna touch on inventory quickly. How do you guys feel about the current levels and the composition? Do you anticipate normalization still sometime in the back half? Just finally, how are you prioritizing distribution against kind of some of the constraints that you still have? Yeah. A couple of things on the inventory side. I think we feel very confident with it. It's a big question of do you have the right products at the right place, right? Which was a key ingredient for our Q1. We were able to actually foresee the product that is really resonating with the consumer, and we feel very confident about that. We feel we have the right product at the right place. We feel confident, especially in Europe now as well, that we will have more product available for Q2. We have good availability in the US for Q2. As Martin already pointed out, some additional air freight will be needed, but on a very different level than in Q1. What's a little bit an unknown or where everyone still faces some difficulties is really, you know, there's lots of port congestion still happening. There's a lot of inventory on sea that is not in the warehouses, so it's a bit hard to exactly maneuver kind of the inventory to the minute, which makes it then hard to deliver the product exactly on time to the retailer. That's also where sometimes, you know, you see some shifts between months and potentially between quarters as containers are going in and out. Kimberly, to your question of how do we prioritize whom we ship. Of course, we have a very strong DTC business. They're excellent at forecasting because they see, of course, what is selling through. We try to make that available. It's really by the quality of the account, and by that we mean which consumers do they serve. You want the right product to show up in the right channel. That's been a big focus. We've seen less of it, but there was definitely a time when retailers tried to hoard a little bit the inventory. We were very strict about really aligning what they can sell with what we ship them. Great. That's super helpful. Thank you. Next question is from the line of Grace Smalley from JP Morgan. Please go ahead. Hi, thank you. I think you referenced earlier that the category is sort of relatively more resilient in an inflationary environment. Are there any sort of specifics about On's consumer demographics and price points that you think might make On relatively more resilient to some of the other brands in the category? Or how do you think about that? Thank you. Yeah. That's a very, very good question. You know, in the 12 years of On, we've seen a crisis or two in different markets. Generally speaking, the sporting goods category and especially running that is not dependent on a lot of equipment and you know availability of gyms and so on is usually gaining in those crisis as you've probably seen from earlier crisis. Especially we have to also you know even On is a premium brand within the category. We're maybe 10% to 15% over our competitors, so we're not a luxury product. We feel that even if consumer spending or disposable income would go down, we would still be in a good position because people would probably defer a car purchase or a vacation over deferring buying something like a running product. We're not overly concerned, but as Marc said earlier, we also see this as an opportunity because when people have to make more considerate choices which brands do they wanna buy, typically our history has shown that the ones that are most desirable will win most. Grace, maybe adding one point. We were speaking now a lot about the Cloudrunner and the Cloudgo. Two products that we are now bringing to the market or have just launched that are at the lower end of our price point, so $140. They also give the more price sensitive customer a choice to buy an On product, and basically experience the technology of the brand. Probably the right product at the right time there. Yeah. Absolutely. Thank you very much. Next question is from the line of John Zantolis from Berenberg Capital Markets. Please go ahead. Hello. Thanks for taking my question. I was hoping to get a bit of an update on wholesale door expansion in 2022 versus the last call. You know, how are you seeing that track? I know you mentioned JD and Foot Locker expanding. And then a little bit broader than that, you know, as you think kind of longer term, how do you see wholesale door expansion changing by geography? Thanks. Thank you for the question. You know, we're trying to have a very consistent strategy over a long period of time, so the answer is gonna be very similar to three months ago. Again, I think we're opening doors in consumer segments where we feel we can gain additional share. This is the Foot Locker and JD discussion. I can give you some numbers where we approximately feel we wanna be by the end of the year. In Foot Locker, we're talking about roughly 130 doors globally. In JD, we talk about roughly 150 doors globally. I spoke about the 68 and 94, where we are right now. This gives you a bit of feeling for it. As said, we are opening with Dick's this summer and the first test doors. This is kind of, you know, especially the JD and Foot Locker going into new consumer segments. Within our core Run segment that we have been in the past, it's definitely very much also geographical gain. Lots of countries like France, like UK, like Italy, we spoke about LATAM, where On is still at a very kind of, you know, just getting started, basically. I think something I wanna... We want to highlight here is what we're seeing is that if we're able to bring apparel to life in the best possible way, which means we need a shop-in-shop, and we need to work with partners that understand how to sell apparel, it's doing really, really well. Really, really well means for us it has roughly a 20% to 25%, 30% sometimes share in that store as part of the On range. That's definitely a focus for us. When we look at door expansion is how can we add doors that are really, really good at selling apparel? Just want to highlight there, we opened two beautiful shop-in-shops, one with Caraway in Germany and one with Sport Chek. Basically out of the gate, we achieved a 20% share. That's gonna be a big focus to just get you know a higher share in the existing stores with more of On's products through an even better execution. Very helpful. Thank you. Next question is from the line of Tom Nikic from Wedbush Securities. Please go ahead. Hey, thanks for taking my question. I just wanted to ask about the, I guess, the shape of the revenue growth for the rest of the year. You know, I think, you know, you were just up 68%, and the full year guide would, you know, suggest you'd be up, you know, I think high 30% the rest of the year. Is there anything, like, constraining revenues in Q2? Or, like, how do we kinda think about, you know, Q2 growth versus the second half of the year? Thanks. Yeah. Tom, very happy to take this. If you look at Q1, at the 68%, especially in wholesale, and then I mentioned it on the call. If you combine Q4 and Q1 together, you have 54% because this is eliminating the impact that we have seen from shifting our start of the spring/summer season from November basically to January. 68% in wholesale is not the like-for-like jump in pace. In Q2, on top of what Marc mentioned, we expect that we are still seeing supply constraints on some products. Much better position than in the Q1, but it's still there. We have the situation in China that we were mentioning. We want to follow our philosophy of providing a prudent outlook and we said, "Hey, our aspiration is higher than that." At the same time, we also want to take into consideration the macroeconomic environment and the uncertainties there, then also to protect our profitability. All of this together is put into the full year guidance that we have given. Understood. Thank you very much. There are no further questions at this time. Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.