Annual sales of 400 million units! In the "Post-Labubu era," can Pop Mart's high growth continue?

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Pop Mart’s announcement on February 9 shows that in 2025, the company’s global sales of all IPs and all product categories will exceed 400 million units, among which THE MONSTERS’ total global sales will exceed 100 million units.

In 2025, Pop Mart underwent a typical “single super IP + category breakthrough” volume expansion, with revenue almost tripling year-on-year. The core driver came from Labubu’s global breakout, as well as plush toys greatly enhancing IP monetization efficiency. The latest operational data now shifts market attention to what happens “after the blockbuster”.

According to ZF Trading Desk, HSBC Global Research analyst Lina Yan judged in a report: “The ultra-fast growth brought by Labubu will fade, but platform capabilities will continue,” and defined 2026 as a “re-baseline” year. UBS believes the data helps alleviate market concerns about dependence on a single blockbuster, while the new IP Twinkle had a strong start in early 2026, providing an observation window for continued growth.

HSBC has lowered Pop Mart’s target price from HKD 392.5 to HKD 354, while UBS maintains the target at HKD 326. Both institutions maintain a “Buy” rating. Calculated near the closing price of HKD 257.2 on February 9, this implies upside potentials of about 38% and 26.7%, respectively, but the common premise is that the explosive growth of 2025 will be difficult to replicate.

For investors, the key variable is shifting from “rush-to-buy acceleration” to “normal retail expansion + new product rhythm”. HSBC has lowered its 2026 revenue and profit growth forecasts, citing a decline in repeat-purchase intensity among members and slower growth, but also emphasizes that the valuation has already factored in IP lifecycle risks to some extent. Going forward, more attention will be paid to new product incubation and global execution capability.

2025 Breakdown: Labubu and Plush “Overhaul,” But Foundation Is Not Hollow

HSBC breaks down 2025’s high growth into two levers. By IP, The Monsters (Labubu) revenue increased about +582% year-on-year, with estimated revenue contribution rising to 47% (previously about 23%). By category, plush toys’ revenue increased about +720% year-on-year, with contribution rising to 60% (previously about 22%). This brings Pop Mart’s growth closer to the blockbuster cycle seen in consumer products, where IP popularity plus new category volume leads to products with higher frequency, higher transaction values, and easier spread.

However, HSBC also emphasizes the “foundation after excluding blockbusters.” According to its estimates, after excluding The Monsters, 2025 revenue still grew about 106% year-on-year; excluding plush, revenue still grew about 51%. This means that incremental growth in 2025 was highly concentrated, but the company’s original business did not stall.

In mainland China, the most easily overlooked incremental source is repeat purchase member ARPU. HSBC says that, in 2025, nearly half of revenue growth in mainland China comes from increased ARPU among repeat-purchase members (annual purchase frequency > 2 times). Structural data points to strong purchase intensity during a “tight supply” phase: in 2025, membership accounts for about 91% of sales in mainland China, repeat purchases for about 55.8%, and repeat purchasers account for about 83% of sales. This scarcity-driven slope means that, once the supply-demand mismatch eases, a slowdown in growth is almost logically inevitable.

2026 Re-Baseline: ARPU Normalizes, Growth Returns to “Expansion Year” Framework

HSBC’s core judgment for 2026 is that after the “rush-to-buy” effect fades, repeat-purchasing member ARPU will normalize, pulling growth back from an explosive state to the normal track of retail expansion. Based on this change, HSBC has lowered its 2026 revenue growth forecast from 30.6% to 23.7%, and net profit growth forecast from 29.1% to 21.3%, and cut 2026-2027 profit forecasts by 11%-13%. The target price cut mainly comes from lowered earnings forecasts, not an overhaul of the valuation framework; key DCF assumptions of WACC 10% and perpetuity growth rate of 3% remain unchanged.

Regionally, HSBC expects 2026 PRC revenue growth of about 13.0%, and overseas about 35.7%. Overseas is seen as the main buffer against falling ARPU in China, but the logic has shifted from “volume ramp-up” to “network rollout,” relying more on offline point execution: overseas retail POS is expected to rise from 218 in 2025 to 331 in 2026. For the market, this means growth visibility now depends more on details such as site selection, supply matching, blockbuster timing, and localized operations.

Risks are thus more on the “execution side”. HSBC highlights disruptions including supply chain failing to keep up with demand, scalpers squeezing out real consumers, short-term stock price pressure from shareholder placements, counterfeits affecting the brand, risks of renewing exclusive artist authorization contracts, as well as new business/mergers leading to capital misallocation, added competition, and offline traffic disruptions.

Valuation & Relay: Can New IPs Fill the "Post-Labubu" Growth Gap?

On valuation, HSBC believes the market is digesting “Labubu lifecycle risk” through valuation compression. Its basis: since early 2025, the company’s one-year forward EPS has increased about 394%, but on consensus expectations, one-year forward PE dropped about 45% from the 2025 average, and about 65% from the 2025 peak. Against this backdrop, HSBC is focused on whether “platform capability” can continue to incubate and globalize new IPs, rather than simply betting on prolonged blockbuster popularity.

UBS’s “relay observation” focuses on new products and overseas interaction. It notes that the newly launched IP Twinkle performed strongly in early 2026, with the Valentine’s Day edition selling over 30,000 units on Tmall and over 46,000 units on Douyin, and the Spring Festival plush toy selling over 20,000 units on Tmall on its debut. Overseas, the Skull Panda x My Little Pony collaboration series sold out via direct shipping from the North America official website, and its Instagram preview garnered 460,000 likes. UBS also notes that in markets like the US, consumer engagement, local IP and brand building need to be strengthened. The proportion of new overseas employees is high, and user awareness of multiple IPs is still being cultivated.

Both institutions view subsequent data as verification points. UBS states that the annual report and Q1 2026 sales data will be used to check performance in China and overseas, especially in the US market. For investors, the core question in the “post-Labubu era” is not whether 2025 was brilliant, but whether from 2026 onward new product matrices, overseas retail expansion, and more sustainable member operations can carry growth from an explosive to a normalized trajectory.

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