Bursting the Bubble on Purpose? Pop Mart’s Ultimate Strategy Emerges

Recently, Pop Mart’s stock price has been trending downward.On the news front, the company’s hottest IP products are showing turbulence in the secondary market—prices of the LABUBU Generations 1–3 collectibles have dropped, while the newest mini LABUBU edition, released just over a week ago, has seen a “spike-then-slide” price pattern.On social media, some scalpers have openly stated that they are pausing purchases of the LABUBU series due to the sharp decline in resale value.This secondary-market dip is closely tied to Pop Mart’s aggressive production expansion and market supply surge.According to Yuan Junjie, President of Pop Mart’s Supply Chain Center, “The current monthly output of plush products equals the entire production of last year.”In August alone, output reached about 30 million units, with capacity increasing over tenfold year-on-year.The market is beginning to treat this once-red-hot new-consumption brand with caution.Short-selling activity has spiked sharply: data show that the number of shares sold short jumped from nearly 300,000 on August 29 to over 6 million just a week later, while the short-sell value ballooned from under RMB 1 billion to nearly RMB 20 billion.

A similar scenario played out back in June.That month, a global buying frenzy for LABUBU triggered rampant scalping, hurting the customer experience.By mid-June, Pop Mart’s stock began to fall and short-selling climbed.On June 18, the company responded with a large-scale restock, opening LABUBU online pre-orders for the first time, which in turn drove second-hand prices lower.Afterward, Pop Mart’s share price moved sideways for almost two months—until the release of its 2025 half-year earnings report.The company posted record-breaking results on August 20, propelling the stock to a new all-time high and pushing market capitalization past HKD 420 billion.At that same mid-year briefing, founder, chairman, and CEO Wang Ning announced the launch plan for the mini LABUBU.However, the new product failed to spark fresh investor imagination.Whether because the share price had already priced in expectations for the mini series or because the product itself lacked novelty, the launch didn’t lift the stock.

From the day before the release through the September 10 close, Pop Mart’s share price had fallen about 20 percent.Interestingly, on September 8, good news also arrived: Hang Seng Indexes Company Limited announced its Q2 2025 index review, adding Pop Mart to the Hang Seng Index and expanding the component count from 85 to 88 stocks.Joining Pop Mart were China Telecom and JD Logistics.While inclusion typically attracts more investors and capital inflows, it also invites heavier scrutiny and wider market influence on the share price.For Pop Mart, ensuring a healthy, well-ordered sales ecosystem is key to sustainable growth.The company’s capacity expansion helps curb scalper-driven chaos.Although past supply shortages may have temporarily fueled IP hype, they also threatened long-term revenue and undermined the “long-termism” that Wang Ning frequently stresses.Still, COO Si De expressed concern over capacity during the earnings call, noting that the company is still chasing production targets and faces significant supply-side challenges in the second half of the year.Early on, Pop Mart was often compared to Disney, but it is now forging its own path.Today, the key question for the company is clear: how to nurture and sustain evergreen IPs.Even a smash hit like LABUBU needs time to prove its long-term vitality.

During the earnings call, Founder, Chairman, and CEO Wang Ning stated:“What I value most is the meaning behind LABUBU becoming a world-class IP—that’s the truly valuable part.”He is frequently asked how Pop Mart keeps LABUBU’s popularity alive.His response: “This year, people rarely talk about Mickey Mouse, Naruto, or Hello Kitty, yet these super IPs continue to generate massive global commercial value. When an IP reaches a world-class level, its real business value is only just beginning.”Wang Ning added,“LABUBU, as the first Chinese-origin IP with the potential to become world-class, carries tremendous commercial value.”He emphasized that the company remains measured in external collaborations and product development, avoiding overexploitation of the brand.Demand is still robust, and future value remains substantial.In 2024, Pop Mart recorded RMB 13.04 billion in revenue, holding a commanding lead in both buzz and sales within the designer-toy industry.Many brands aspire to replicate Pop Mart’s success, but most are still far behind.Take THE MONSTERS series, which includes LABUBU: it generated RMB 3.04 billion in annual revenue, a 726.6% year-on-year increase—more than triple the total annual revenue of TOP TOY that year.

TOP TOY, a designer-toy brand under MINISO, has traditionally focused on international IP licensing.This year, it is investing heavily in developing original IP and expanding aggressively across domestic and overseas markets, clearly benchmarking itself against Pop Mart.With a longer timeline, these newcomers could eventually carve out a slice of Pop Mart’s market share.According to 2025 mid-year results, TOP TOY posted RMB 742 million in first-half revenue, up 73% year-on-year, already exceeding three-quarters of its full-year 2024 total.TOP TOY founder and CEO Sun Yuanwen highlighted a structural challenge in the designer-toy supply-demand chain during a recent interview.He pointed out that scalpers have effectively become the biggest customers, rather than genuine consumers.China’s supply-chain capabilities could easily solve stock shortages, he argued, but the real issue lies in speculation and scalper-driven market behavior.True top-tier IP companies, Sun stressed, do not rely on artificial scarcity for hype.This underscores a critical reality: whether for the designer-toy market as a whole or for individual IP-driven companies, escaping the “held hostage by scalpers” supply-demand trap and returning to an authentic, user-value-centered business model is no longer a short-term concern.Instead, it has become a long-term challenge that demands continuous reflection and systematic solutions.