--- title: "Pop Mart: Revenue Surges, Shares Plunge — Who Got It Wrong?---" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/39517772.md" description: "2026 guidance signals a marked slowdown" datetime: "2026-03-25T14:09:13.000Z" locales: - [en](https://longbridge.com/en/topics/39517772.md) - [zh-CN](https://longbridge.com/zh-CN/topics/39517772.md) - [zh-HK](https://longbridge.com/zh-HK/topics/39517772.md) author: "[Dolphin Research](https://longbridge.com/en/news/dolphin.md)" --- # Pop Mart: Revenue Surges, Shares Plunge — Who Got It Wrong?--- On the afternoon of Mar 25 (Beijing time), Pop Mart (9992.HK) reported its 2H25 results, and the stock plunged 22% intraday. **On headline numbers, H2 performance was broadly in line with Bloomberg consensus, but fell short of some bullish buy-side models.** Stripping out the print, **management’s conservative 2026 guide was the other disappointment, and the two together fueled the afternoon selloff.**$POP MART(09992.HK) Key takeaways: **1) Overseas revenue missed.** In 2H25, Pop Mart delivered revenue of RMB 23.2bn (+174% YoY), with growth moderating from 200%+ in 1H. Domestically, **benefiting from tighter omnichannel ops (notably stronger online), revenue reached RMB 12.6bn (+183% YoY), with a sequential acceleration that beat the Street.** Overseas rose 281% YoY but decelerated QoQ, especially in North America. Versus 10x+ growth in Q3 and based on channel checks, **limited refined operations overseas led to a visible slowdown in offline sales after Nov, and 'Black Friday' promotions lacked the expected spike, taking growth below 500% and dragging overall overseas performance.** **2) Faster overseas store openings.** To capture LABUBU-driven traffic, **the company accelerated overseas openings in H2, adding a net 72 stores, mainly in North America, and pursued clustered layouts in core districts like New York and Los Angeles.** In China, **net adds were just two, with a focus on upgrading existing stores; after boosting store area by 30–50%, sales density roughly doubled.** **3) Higher mix for The Monsters.** **As Labubu capacity freed up in H2, The Monsters’ mix rose from 34.7% to 40%.** Other legacy core IPs, including Molly and Dimoo, were softer with lower mix. **The bright spot was the Xingxingren series, the fastest-growing IP, lifting its mix from below 3% in 1H to 7.2%.** **4) Plush now the primary category.** Figurines led by blind boxes kept losing share, while higher-margin plush surged. Beyond LABUBU, other flagship IPs also turned more ‘plush’, **lifting the overall plush mix from 44% in 1H to 54%.** **Separately, the POP BLOCK brick brand saw its business double HoH on launches like Molly Architecture and Labubu Forest, sustaining solid momentum.** **5) Online outperformed.** By **ramping livestream frequency on Douyin and other platforms in H2, Pop Mart drove a notable uplift in online conversion.** In its WeChat mini-program ‘抽盒机’, **features like team draws and disclosed odds for rare items boosted engagement and concentrated private-domain traffic**, taking online channel growth past +200% YoY, ahead of the overall market. **6) Operating leverage kept improving.** With the higher-margin overseas mix rising and plush share surging, **GPM reached a record 73% in H2.** On opex, a higher online mix lifted customer-acquisition efficiency, taking the selling expense ratio down 600bps to 21%, while G&A fell 400bps to 6% on disciplined spending. **Core OPM expanded to a record 48%.** **7) Guidance.** On the call, **management guided 2026 revenue growth of no less than 20%; ex-store additions, implied same-store growth is low single-digit. In their words, it will be a ‘pit stop year to refuel and change tires’, well below the ~30% market expectation.** **8) Detailed financials:** **Dolphin Research’s take:** As discussed above, H2 was not weak and broadly matched our expectations. **We see the midday plunge as primarily driven by the underwhelming 2026 guide.** At this stage, the key risk for Pop Mart is what comes after The Monsters: where is the next mega IP? The answer to that question is reflected in management’s 2026 growth outlook. Pop Mart is essentially an end-to-end IP incubation and distribution platform, analogous in model to a streaming platform like Netflix. **If Netflix fears a content gap, Pop Mart worries about IP aging and gaps in the pipeline.** From early reliance on Molly to SKULLPANDA, Dimoo and then The Monsters, **any lull without a hit quickly dents growth, similar to Netflix in a ‘content-light’ year.** **From this angle, The Monsters at 40%+ is not ideal, as a fade in Labubu’s heat without a similarly scaled successor IP would hit earnings hard.** **In fact, at least domestically, indicators such as secondary-market prices, search volumes and topic heat all suggest Labubu’s popularity is trending down.** **We see this as the core reason behind the sharply slower guide.** To mitigate this risk, **Pop Mart clearly accelerated new IP launches from Q4 last year**, though early feedback on Supertutu and After-school Merodi has been lukewarm. History shows Pop Mart’s industrialized ‘star-making’ system works — **constant ideas from global artists, an internal ‘screen-test-scale’ mechanism to gauge IP potential, and powerful channel and supply-chain support to push winners to the fore**. With stepped-up IP creation, we see the next hit akin to Xingxingren as a matter of time. Finally, on valuation, **the LABUBU-fueled hypergrowth phase has passed, and the focus shifts to hard-mode, refined operations to lift store productivity.** **On management’s 2026 profit growth target of 20%, or RMB 15.6bn in net profit, the post-plunge valuation is ~13x — ordinary retail territory, arguably an overshoot.** On our math, **assuming low-single-digit SSS growth overseas and in China, plus ~50 net overseas openings per year, 2026–2029 CAGR can still be ~20%.** **With improving overseas ops and continued IP creation and operations, a rerating back above 20x (HKD 312bn) looks likely.** **In addition, management flagged a 5-year focus on group-level IP monetization (parks, film & games). Current valuation lacks this optionality, and upside exists if group-level initiatives exceed expectations.** **Detailed results analysis:** **I. Overseas revenue below expectations** In 2H25, Pop Mart delivered total revenue of RMB 23.24bn (+174% YoY). By segment, **overseas revenue was RMB 10.67bn (+281% YoY), slower vs 1H, with mix rising from 40% in 1H to 46%.** **North America:** H2 revenue was RMB 4.54bn, **+733% YoY, with mix surging from below 20% a year ago to 43%.** Despite more local artist and streetwear collaborations and greater exposure in mainstream cultural moments like Thanksgiving parades, **North America remains the market with the highest single-store productivity and fastest growth globally (per-store revenue est. RMB 45–50mn).** **However, rapid near-term store expansion constrained fine-tuned operations; offline trends softened after Nov, and 'Black Friday' lacked the expected step-up, taking growth below 500% and weighing on overseas results.** **Europe:** After nearly a year of testing, Pop Mart expanded in H2 across core cities in the UK, France, Spain, the Netherlands, Denmark and Belgium. **Revenue reached RMB 970mn (+135% YoY), or close to 10% of the total.** **Asia-Pacific:** Revenue was RMB 5.16bn (scope changed, no YoY for now). **Thailand and Singapore shifted from a ‘breakout’ phase to ‘steady growth’, with seasonality like the rainy season diluting offline traffic in SE Asia.** **China revenue was RMB 12.57bn (+183% YoY), with a clear acceleration vs 1H.** Based on checks, LABUBU mini (RMB 99–149) and Halloween plush (RMB 199–299) lifted AOV, while IP adjacency into accessories, stationery and desserts **raised ARPU among members.** **II. Overseas store openings accelerated** On pace, **Pop Mart sped up overseas openings in H2, adding a net 72 stores, primarily in North America.** By end-2025, **North America had 60+ stores across New York, Los Angeles, Chicago, Miami and other key metros.** In Dec, Vancouver saw the first store in Canada, marking entry into the region’s second-largest market. **Toronto is slated for early 2026, completing core coverage on both coasts.** Strategically, **most H2 openings were full-format, long-term standard stores (large flagship formats) to absorb LABUBU-driven traffic.** Europe added 18 net stores in 2H25, an acceleration vs 1H, **taking coverage across the UK, France, Germany, Italy, the Netherlands and Spain, now the second growth engine overseas.** APAC added 16 stores; with a larger base, H2 focused on format upgrades. **In Dec, Pop Mart opened its first store in Manila, filling the last strategic gap in SE Asia.** In China, **Pop Mart closed low-efficiency community and basement stores, upgrading toward premium malls, cultural landmarks and top shopping centers; net adds were only two**, far slower than overseas as resources were focused offshore. **The domestic pace implies limited room for further footprint expansion; future growth must rely on refined operations to lift store productivity.** On per-store sales, with better store quality and broader categories, **we estimate average H2 domestic per-store revenue at RMB 12.76mn (+98% YoY).** Both traffic and ticket size rose meaningfully. Overseas averaged RMB 28.52mn per store (+115% YoY), **narrowing the gap vs domestic, largely because overseas openings stepped up in H2.** Net-net, while overseas white space remains, **stores are conversion points; if product heat fades and sales stall, stores can become a drag. The core remains IP heat sustainability.** **III. The Monsters mix rose further** By IP contribution, **as LABUBU’s H2 capacity constraints eased, The Monsters’ mix climbed from 34% to 42%, a new high, making it the core IP.** Given softer trends in prior core IPs like Molly and Dimoo, **without a ‘brick breakout’ or a new top-tier IP baton in 2026, repeating 2025’s explosive growth will be difficult.** Meanwhile, **the domestically focused Xingxingren series lifted mix from 3% to 7%, with full-year revenue at an estimated RMB 2.5bn. As overseas is still in the early awareness stage for Xingxingren, a 2026 overseas ramp should offset slowing growth in China.** **IV. Plush entrenched as the largest category** By product, figurines led by blind boxes kept losing share, replaced by explosive growth in the higher-margin plush category. Beyond LABUBU, other flagship IPs also moved toward plush, **lifting overall mix from 44% in 1H to 54%.** **In addition, POP BLOCK (bricks) doubled HoH on the Molly Architecture and Labubu Forest series, showing strong momentum.** **V. Online mix rose sharply** By channel, **Pop Mart increased livestream frequency on Douyin and other platforms in H2, clearly boosting online conversion.** Furthermore, **the WeChat mini-program ‘抽盒机’ added gameplay like team draws and published rare-item odds, concentrating and unlocking private-domain traffic**, taking online growth above +200% YoY, ahead of the broader market. **VI. GPM hit a new high** With the higher-margin overseas mix rising (overseas GPM ~10ppt above domestic) and richer product mix (plush), H2 GPM reached a fresh high of 73%. **VII. Operating leverage expanded, profitability surged** With a higher online mix and better CAC efficiency, the selling-expense ratio fell 600bps to 21%, and G&A declined 400bps to 6% on restrained spending. **Core OPM climbed to 48%, a record.** Related reading: Earnings season Mar 26, 2025 Earnings Take: ‘[Pop Mart: Pedal to the metal — can the run continue?](https://longbridge.cn/zh-CN/topics/33130874?channel=SH000001&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN&share_track_id=580d715f-b9ad-44ba-b439-78633899a2ee)’ Mar 26, 2025 Earnings Take: ‘[Pop Mart: Overseas legend — still ‘full throttle’?](https://longportapp.cn/zh-CN/topics/28377085?channel=t28377085&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN)’ Aug 20, 2024 Earnings Take: ‘[PDD’s way is ‘too low’? Taking brand ‘vibes’ global is the real deal](https://longportapp.cn/zh-CN/topics/23293069?channel=t23293069&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN)’ Aug 21, 2024 Call Notes: ‘[Pop Mart sprint: ‘Full-year \>60%, overseas +200%’](https://longportapp.cn/zh-CN/topics/23314868?channel=t23314868&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN)’ Mar 28, 2022 Earnings Take: ‘[Pop Mart: even trendy toys can’t escape the grind](https://longbridgeapp.com/topics/2201615?channel=t2201615&invite-code=276530)’ Mar 28, 2022 Call Notes: ‘[Pop Mart’s new magic?](https://longbridgeapp.com/topics/722527?channel=t722527&invite-code=276530)’ In-depth Nov 28, 2024 Deep Dive: ‘[It’s just a toy — why the big comeback?](https://longportapp.cn/zh-CN/topics/25792906?channel=t25792906&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN)’ Dec 10, 2024 Deep Dive: ‘[Overseas hypergrowth — this ‘bubble’ won’t burst](https://longportapp.cn/zh-CN/topics/25980814?channel=t25980814&invite-code=7XHHT4&app_id=longbridge&utm_source=longbridge_app_share&locale=zh-CN)’ **Risk disclosure and disclaimer:**[**Dolphin Research Disclaimer and General Disclosure**](https://support.longbridge.global/topics/misc/dolphin-disclaimer) ### Related Stocks - [09992.HK](https://longbridge.com/en/quote/09992.HK.md) - [NFLX.US](https://longbridge.com/en/quote/NFLX.US.md) - [HPPD.SG](https://longbridge.com/en/quote/HPPD.SG.md)