Is there a concentrated risk in home appliance hacking IP? After Pop Mart released its earnings report, the stock price fell over 20%.

Ask AI: Can home appliance layouts help mitigate IP dependency risk?

On March 25, after Pop Mart (09992.HK) released its 2025 full-year earnings report, the stock price plunged straight after the afternoon opening, at one point falling by more than 20%. As of today’s close, Pop Mart was at HK$168.3 per share, down 22.51%, with a total market capitalization of HK$225.7 billion.

On March 24, a research report released by Morgan Stanley said that due to highly polarized market views, it expects Pop Mart’s stock price to remain volatile after the earnings release, with the price possibly rising first, then entering a new round of range-bound trading.

The financial report shows that Pop Mart’s full-year revenue for 2025 reached RMB 37.12 billion, up 184.7% year over year; adjusted net profit was RMB 13.08 billion, up 284.5% year over year.

The plush category accounts for more than half of revenue

LABUBU generated over RMB 10 billion in revenue last year

From the IP lineup, in 2025, the LABUBU family (THE MONSTERS) recorded revenue of RMB 14.16 billion, up 365.7% year over year, and its share of total revenue increased from 23.3% in 2024 to 38.1%, becoming the top IP in Pop Mart’s revenue. In addition, SKULLPANDA, CRYBABY, MOLLY, DIMOO, and Star Man each achieved revenue of RMB 3.54 billion, RMB 2.93 billion, RMB 2.9 billion, RMB 2.78 billion, and RMB 2.06 billion last year, respectively.

The plush category became Pop Mart’s product category with the highest share of revenue. In 2025, Pop Mart’s plush category generated revenue of RMB 18.71 billion, up 560.6% year over year, accounting for 50.4% of total revenue.

The financial report shows that Pop Mart’s cost of sales increased from RMB 4.33 billion in 2024 to RMB 10.355 billion in 2025, an increase of 139.1%. The company said this was mainly because higher sales led to higher merchandise costs, as well as design and licensing costs rising from RMB 507 million in 2024 to RMB 951 million in 2025.

A research note from Guohai Securities previously said that Pop Mart operates and monetizes IP through multi-dimensional approaches. It also noted that the product-category expansion logic continues to be validated, and overseas market performance continues to exceed expectations. However, risks still need to be watched, including “IP renewals falling short of expectations” and the risk of “reliance on a single IP.”

In the view of Gao Chengyuan, chairman of Zhuwang Marketing Consulting, the solution to concentrated IP risk is not to look for the next “LABUBU,” but to turn IP into a “content system.” First, delve deeper into the story vertically, animation- and game-ify the fairy universe, and increase replacement costs; second, broaden across categories horizontally by expanding into high-repurchase tracks such as plush, building blocks, and jigsaw puzzles, upgrading a single IP from blind-box collectibles into a lifestyle; third, an internal “horse-racing” mechanism, with at least five mid-sized and small IPs incubated every year. Use DTC mini programs to quickly test orders—so long as new million-level series keep appearing year after year in the rolling pool, the cycle of a single IP will be smoothed into a “product cycle,” enabling the company’s valuation to shift from “hot-item premium” to “platform premium.”

Overseas business revenue growth of 292%

Home appliance products will be launched next month

It is worth noting that Pop Mart has become aware of changes in the market and is accelerating the layout of new growth drivers. Recently, the company released multiple co-branded products to expand IP derivative development, while also increasing investment in overseas markets in an effort to diversify risk through a globalized layout.

By region, Pop Mart’s revenue from the China market in 2025 was RMB 20.85 billion, up 134.6%; overseas business revenue was RMB 16.268 billion, up 292.0%, with its share of total revenue rising from 31.8% to 43.8%. Of that, the Asia-Pacific market generated revenue of RMB 8.01 billion, up 157.6%; the Americas generated RMB 6.81 billion, up 748.4%; and Europe and other regions generated RMB 1.45 billion, up 506.3%.

Meanwhile, Pop Mart is trying to learn from the mature operating models of the luxury goods industry, achieving a transformation and upgrade from the blind-box arena to becoming a fashion-luxury brand through three strategies: precise community-layer operations, building scarcity, and enabling cultural value.

In March 2025, Pop Mart founder Wang Ning directly said, “Studying how LV maintains scarcity,” and said he would learn the scarcity-based operating logic of luxury brands. In October, the LVMH brand MOYNAT and Pop Mart designer Long Jiasheng launched a co-branded bag series. On December 10, Pop Mart announced that Wu Yue, President of LVMH Greater China, would become a new non-executive director of the company’s board. Public information shows that Wu Yue has served as President of LVMH Greater China since 2005, overseeing the businesses of multiple luxury brands in the Chinese market.

On March 25, Pop Mart’s COO Si De stated at the company’s 2025 results press conference that Pop Mart’s home appliance products will officially meet everyone next month. In addition, Pop Mart’s dessert business will also be rolled out offline in the first half of this year at Pop Mart Land, the Thailand flagship store, and multiple pop-up stores.

It is understood that LABUBU will launch a 4.0 series and an artist co-branded series in the second half of the year. In addition, LABUBU will appear on the World Cup pitch in June. The LABUBU family’s tenth anniversary global touring exhibition is also continuing to land in countries around the world. From a medium- to long-term plan, LABUBU will develop content formats such as picture books and films, all of which are still in the preparation stage.

Byline: Nandu·Bay Finance and Economics Society reporter Wang Leina