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TMTPOST -- Shares of Pop Mart International Group Ltd. surged more than 12% in Hong Kong on Wednesday, after the Chinese toymaker reported a near fourfold jump in first-half profit, fueled by red-hot demand for its Labubu dolls both at home and abroad.
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The stock closed up 12.5% at HK$317, rebounding from an early drop of as much as 4.7%, as investors digested results that far exceeded expectations. The gains extend a rally that has already seen Pop Mart』s market value more than triple this year, positioning the Beijing-based company among the fastest-growing consumer plays in China』s equity market.
Revenue for the six months to June 2025 soared 204% year-on-year to 13.88 billion yuan ($1.93 billion), while net profit attributable to shareholders surged 397% to 4.57 billion yuan. That crushed the company』s own guidance issued last month, when it projected at least 200% revenue growth and a 350% rise in earnings.
CEO Wang Ning said on an investor call that Pop Mart remains firmly on track to meet its 2025 revenue target of 20 billion yuan, adding that hitting 30 billion yuan this year 「should also be quite easy.」 The company also plans to launch a miniature version of Labubu this week, designed to clip onto smartphones.
Pop Mart』s breakout success has been anchored by Labubu, a sharp-toothed, big-eared character that embodies the 「ugly-cute」 aesthetic popular among Gen Z and millennial consumers. Plushies, figurines, and accessories featuring Labubu have become viral must-haves, with $30 keychains spotted on celebrities from Rihanna to Blackpink』s Lisa.
The craze has translated into blockbuster sales abroad. Revenue from Asia-Pacific markets outside China jumped nearly 258% to 2.85 billion yuan, while sales in the Americas surged more than 1,000% to 2.26 billion yuan. International markets are now central to Pop Mart』s growth story, accounting for more than a third of revenue.
「Intellectual property is at the core of our business,」 Pop Mart said in its earnings statement, pledging to keep expanding its global reach and deepen its pipeline of original characters and collaborations.
Analysts say part of Wednesday』s sharp rebound may have been fueled by short-sellers rushing to cover positions. 「The stock will likely make new highs in the coming weeks,」 said Hao Hong, managing partner and CIO of Lotus Asset Management. 「The volatility is partly from short covering, especially in a thinly traded market like this.」
Others point to positioning among different investor bases. 「We』re likely seeing domestic hedge funds and retail investors locking in profits, while global institutional investors are treating Pop Mart as a broader China consumption play,」 said William Ma, CIO at Grow Investment Group.
Despite the runaway growth, Pop Mart faces regulatory scrutiny at home. Chinese state media in June urged tighter oversight of 「blind-box」 toys and trading cards sold to young children, recommending age verification and parental consent for purchases. Pop Mart pioneered the blind-box model, which has become both a sales driver and a point of criticism for encouraging excessive spending by minors.
Some analysts remain cautious about whether Pop Mart』s flagship brands can maintain momentum. 「While sales of Labubu and other IPs remain robust, there』s no guarantee consumers will continue to favor them in the next five to ten years,」 said Jeff Zhang, equity analyst at Morningstar. 「Shares likely remain overpriced as investors are overlooking the high business risk in the long run.」
Pop Mart』s stock has already climbed more than 200% since January, according to LSEG data, leaving valuations stretched compared to regional peers. Still, with global demand accelerating and new product launches in the pipeline, bulls argue the company remains well-positioned to sustain growth.
For now, Labubu』s global popularity continues to define the company』s trajectory — and investors are betting that the ugly-cute fad still has room to run.
