Chinese character corporations Pop Mart (泡泡玛特) is facing growing concerns about sustainable growth as its stock price plunges despite record results. With criticism of a "peak-out" emerging, analysts say the company relies too heavily on its core intellectual property (IP) "Labubu" and has failed to cultivate a next-generation core IP to succeed Labubu. The company is seeking a breakthrough by producing an animated film to expand the character universe of IPs that existed only as characters without stories and by previewing the launch of home appliances using the IP.
◇ Record results… sales and profit both surge
According to Chinese business media Caixin and China Business News, Pop Mart said in results released on the 25th that in 2025 it recorded sales of 37.12 billion yuan (about 8 trillion won) and adjusted net profit of 13.08 billion yuan (about 2.8488 trillion won). The figures rose 184.7% and 284.5%, respectively, from a year earlier, marking the best results since the company was founded. By product line, the plush doll category surged 560.6% to 18.71 billion yuan (about 4 trillion won), taking the largest share of sales for the first time.
Global expansion also supported the results. Overseas sales rose 291.9% to 16.27 billion yuan (about 3.5451 trillion won), and their share of total sales expanded from 31.8% to 43.8%. Among them, sales in the Americas and in Europe and other regions increased 748.4% and 506.3%, respectively, establishing themselves as another pillar of growth. The company said results in the U.S. market far exceeded internal expectations.
The number of stores also increased significantly. Pop Mart added 109 stores worldwide last year to operate a total of 630. The number of robot vending machines rose by 165 from a year earlier to 2,637. It opened its first offline stores in Germany, Denmark, Canada and the Philippines, and opened flagship stores in Shanghai, China; Bangkok, Thailand; and Sydney, Australia.
◇ Stock plunges on Labubu dependence and peak-out worries
But the market reaction was the opposite. On the day of the earnings release, Pop Mart's stock price on the Hong Kong market plunged 22.5% from the previous day. The decline continued, and as of 1 p.m. on the 27th it was trading at 150.7 Hong Kong dollars (about 28,996 won), the lowest in a year since April last year.
The plunge is seen as reflecting concerns about sustainable growth. In particular, with the sales share of The Monsters series, which includes Labubu, reaching 38% of the total, the excessive dependence on a specific IP was cited as a burden. According to the earnings release, The Monsters series posted sales of 14.16 billion yuan (about 3 trillion won), up 365.7% from a year earlier. By contrast, six IPs including "Skullpanda," "Crybaby" and "Molly" each recorded sales of more than 2 billion yuan (about 435.7 billion won), while the other 17 IPs each recorded sales of 100 million yuan (about 21.7 billion won).
At the same time, projections of slower growth also had an impact. Pop Mart CEO Wang Ning said at the earnings release that this year's sales growth target is "above 20%," a sharp drop from 2025's 184.7%. The company says that in the stage after rapid growth it will prioritize sustainability over scale expansion, but the market appears to interpret this as a sign that the growth curve has passed its peak.
In response, Pop Mart on the 26th announced a share repurchase plan to halt the stock's slide. Pop Mart will buy 3.94 million shares at 148.4–157.8 Hong Kong dollars per share for a total of 599 million Hong Kong dollars (about 115.2 billion won).
◇ IP home appliances and animation presented as a breakthrough
Amid this, Pop Mart is ramping up its IP expansion strategy. In April, the company will launch small home appliances using its IPs such as Labubu and plans to sell them through e-commerce platforms including JD.com (京东). It is an attempt to move beyond an art toy focus and expand into everyday consumer goods.
It is also developing a live-action animation film based on the Labubu IP in collaboration with Sony Pictures. The project is to be produced by combining live action and computer graphics (CG) and is still in the early stages. Director Paul King, who helmed the "Paddington" series and "Wonka," will take the megaphone, and The Monsters' original author Long Kaixing will serve as executive producer.
Offline operations are also expanding. Pop Mart is increasing IP experience spaces through theme parks, flagship stores and pop-up stores, and plans to expand food and beverage businesses such as desserts into stores as well. The theme park that opened in Chaoyang District, Beijing, is slated for an expanded reopening this summer. The strategy is seen as strengthening experience-based consumption centered on IP rather than simple product sales.
However, the results of these expansion strategies have yet to be verified. The mobile game the company introduced has not produced notable results so far, and new IPs have yet to secure influence sufficient to replace Labubu. Morningstar analyst Jeff Zhang told Reuters, "Pop Mart is putting more weight on its licensing business and theme park operations, but I still see high execution risk."