Pop Mart, the Beijing-based toymaker, is grappling with investor concerns following the cooling of the Labubu craze, which had previously propelled the company's revenue and net income to surge by 185% and 309% respectively in 2025 [1]. Despite these impressive financial results, Pop Mart's stock has retreated approximately 40% from its August peak, and shares fell over 22% after the earnings release on Wednesday as investors questioned the sustainability of the company's momentum beyond the initial hype surrounding Labubu [1].
Chief Operating Officer Si De acknowledged the pressure from investors, who have repeatedly questioned the longevity of Pop Mart's popular characters, including Labubu, Molly, and Twinkle Twinkle [1]. CEO Wang Ning sought to reassure the market during the earnings call, emphasizing that Pop Mart's portfolio extends beyond Labubu and likening the company's situation to a "rookie racing driver suddenly thrown onto an F1 circuit" [1].
Si De highlighted the importance of continuous investment in intellectual property, referencing Disney's strategy as a model for maintaining character popularity. He explained that Pop Mart's approach involves global expansion and building immersive worlds around its characters through films, theme parks, and fashion collaborations, with the aim of embedding products like Labubu into people's lives for decades [1].
The development of Labubu was a multi-year process, beginning with its launch as a blind-box collection in 2019 after licensing the character from artist Kasing Lung. Pop Mart's disciplined strategy includes rigorous artist selection and a lengthy incubation process before committing resources to new characters [1].
CONCLUSION
Pop Mart's recent earnings reveal strong financial growth driven by Labubu, but the subsequent share price decline reflects investor uncertainty about the company's ability to sustain its success. Management is focused on global expansion and continuous investment in intellectual property to extend the lifespan of its characters. The market remains cautious as Pop Mart transitions from hype-driven growth to long-term strategic bets.