Pop Mart made a fortune, but the capital bubble burst

Ask AI · How does Pop Mart balance IP popularity with market expectations?

Produced by | New Product Finance

Author | Wu Wenwu

Latest financial report shows that Pop Mart is making a lot of money, but the capital market is not convinced, as if Pop Mart’s capital bubble has burst.

Whether in the past, present, or future, Pop Mart always needs a moderate bubble, and this will not change.

01 Pop Mart is making a lot of money

“New Product Finance” notes that on March 25, Pop Mart Group (09992.HK) released its performance for the fiscal year ending December 31, 2025, with several key financial indicators performing very well.

The financial report shows that in 2025, Pop Mart’s revenue reached 37.12 billion yuan, a year-on-year increase of 184.7%; this revenue also hit a record high, compared to 13.038 billion yuan in the same period last year. During the period, adjusted net profit attributable to shareholders under non-IFRS standards was 13.08 billion yuan, up 284.5% year-on-year.

Pop Mart’s revenue hit a historic high, coupled with a significant increase in net profit attributable to shareholders, so it can be said that Pop Mart is making a lot of money.

The reason for Pop Mart’s excellent performance has long been anticipated by the market.

Last summer, Pop Mart’s super IP LABUBU exploded in popularity, sparking a nationwide frenzy for LABUBU, with second-hand market scalpers scrambling, celebrities, consumers, and netizens rushing to buy LABUBU, creating a super trendy top-tier IP carnival.

LABUBU’s popularity became the core driver of Pop Mart’s skyrocketing performance in 2025, making the company highly profitable.

The financial report shows that in 2025, Pop Mart had 17 artist IPs earning over 100 million yuan, among which the LABUBU family (THE MONSTERS) broke the 10 billion yuan revenue mark for the first time, reaching 14.16 billion yuan, accounting for about 38.1% of total revenue.

In addition, Pop Mart’s SKULLPANDA, CRYBABY, MOLLY, DIMOO, Star People, and HIRONO achieved revenues of 3.54 billion yuan, 2.929 billion yuan, 2.897 billion yuan, 2.777 billion yuan, 2.056 billion yuan, and 1.735 billion yuan respectively during the reporting period.

Undoubtedly, LABUBU has become the pillar IP of Pop Mart’s 2025 revenue.

It is worth noting that Pop Mart’s most profitable business is not blind boxes, but plush toys.

The financial report shows that in 2025, the company’s plush products generated revenue of 18.708 billion yuan, a year-on-year increase of 560.6%, becoming Pop Mart’s highest revenue-contributing product category for the first time.

Based solely on Pop Mart’s latest financial data, it’s clear that the company is making a lot of money!

As a leading enterprise in the trendy blind box toy sector, Pop Mart’s strong financial performance also directly reflects the astonishing consumer power of current trendy IPs.

No wonder Pop Mart has many followers, including Ye Guofu and his Miniso, as well as TOP TOY, which spun off from Miniso and is seeking to go public.

02 The capital bubble has burst

Surprisingly, Pop Mart delivered a financial report impressive enough to astonish the entire market, yet the capital market does not buy it.

Although Pop Mart announced a brilliant annual report, its stock price plummeted by 22.53%, with a market value evaporating over 60 billion yuan. As of the close on the 25th, the stock price was HKD 168.3, with a market cap of HKD 225.6 billion.

The reason given by the capital market is simple: LABUBU contributed to Pop Mart’s core profits, but the company overly relies on a single IP, raising concerns about future performance.

For example, HSBC Global Research analyst Lina Yan recently pointed out in a report that “the super-fast growth brought by LABUBU will fade.”

In reality, since its founding, Pop Mart has been viewed with mixed opinions by outsiders and the market, reflecting multiple facets.

Pop Mart’s business of making blind box trendy toys differs from traditional retail product sales; its main customer base is young people, and fundamentally, it is a business of emotional value and self-pleasure consumption.

Zhang Yongping once said in an interview that he highly appreciates Pop Mart. He stated that although he doesn’t understand Pop Mart and wouldn’t invest in or buy its stocks, the company’s ability to turn emotional value products into such success is not accidental or merely luck.

Therefore, Pop Mart is destined to always face external doubts, and even the company itself will always have bubbles.

Since its listing, Pop Mart’s stock price has experienced multiple booms and busts, each for different reasons. The explosion of LABUBU last year drove the stock price up sharply, but as its popularity waned, the stock price fell significantly.

Pop Mart’s financial performance, the popularity of super IPs, business trends, management decisions, and even industry regulatory changes all influence its stock price.

Many in the capital market believe that Pop Mart’s bubble is too large. Every time its stock price surges and crashes, it’s like the bubble bursting again—this time is no different.

Pop Mart’s business of making trendy blind box IPs cannot escape the cycle from sudden popularity to overpricing and then cooling off.

03 Pop Mart always needs a moderate bubble

A listed company with good performance and promising prospects naturally attracts capital market optimism. Conversely, if performance falters, the market will vote with its feet.

For Pop Mart, which mainly focuses on trendy blind box IPs, it requires a new consumer mindset to view its business operations and capital market performance.

Therefore, the explosive popularity of top IPs like LABUBU is destined to involve bubbles; even all IPs have bubbles—that’s an unavoidable fact dictated by the industry’s product attributes.

LABUBU’s popularity boosts Pop Mart’s stock price and drives its performance surge. As the hype diminishes, many consumers and fans stop rushing to buy, which will gradually impact sales.

“New Product Finance” believes that Pop Mart needs bubbles, but these bubbles shouldn’t be too big. It’s necessary to moderately burst the bubbles to lower market expectations.

According to Huxiu, Pop Mart founder Wang Ning once shared internally that, regarding LABUBU’s explosion, their goal is not to make LABUBU a fleeting trend symbol but to create a long-lasting IP.

For example, when LABUBU exploded last year, causing shortages, Pop Mart chose to restock and actively cool down and deflate the bubble.

From the outside, it’s clear that Pop Mart has become heavily dependent on a single super IP, which is a key issue the company needs to address.

“New Product Finance” believes that Pop Mart needs more than just a single explosive IP like LABUBU; it needs to find the next “LABUBU,” or even multiple “LABUBUs.” In its operations, Pop Mart must balance innovation with market supply and demand, and also master the art of “creating” bubbles and timely deflating them.

Currently, Pop Mart’s ambitions are growing—opening theme parks, jewelry stores, making movies, and even venturing into home appliances—constantly expanding its business boundaries. It seeks more growth curves and new stories.

In the long run, Pop Mart remains a top-tier player in the sector, but many new questions and challenges await.

References:

[1] Pop Mart’s revenue hits record high, but stock drops over 20%, Jiemian News

[2] Pop Mart financial report, Pop Mart

(This article does not constitute any investment advice)

Author’s note: Personal opinions only, for reference