Core Viewpoint - Bubble Mart, established in 2010, is a leading cultural and entertainment company in China, focusing on five key areas: global artist discovery, IP incubation and operation, consumer engagement, promotion of trendy toy culture, and investment integration in related industries [1] Horizontal Performance - The Chinese IP derivative and toy market shows strong growth potential, with the market size projected to increase from 99.4 billion yuan in 2020 to 174.2 billion yuan by 2024, reflecting a compound annual growth rate (CAGR) of 15.1%. By 2029, the market is expected to reach 335.7 billion yuan, with a CAGR of 14.0% from 2024 to 2029 [1] - The Chinese trendy toy market is relatively fragmented, maintaining a healthy IP matrix. Compared to Europe and the U.S., China's per capita spending on IP toys is low, and the consumer base is expanding to include adults as significant buyers [1] Vertical Performance - The company employs a diversified channel strategy for sales, including offline, online, wholesale, and other channels. Key offline sales channels include retail stores and robot stores [2] - The company's box machines are innovating in scene-based and entertainment aspects, effectively linking online and offline traffic through holiday marketing strategies, which has expanded the access scale of WeChat mini-programs [2] - The company demonstrates strong revenue-generating capabilities and growth potential, with steady increases in net assets, improved scale effects, and declining main fee rates. Profitability is also on the rise, with steady improvements in gross and net profit margins [2] Investment Recommendations - IP operation and creative design are critical for the company's sustainable development. As a leading global trendy toy IP platform, the company has successfully created multiple popular cultural IP images through a mature IP operation system [3] - The company is expected to increase its overall revenue from 33.83 billion yuan in 2025 to 61.83 billion yuan in 2027, with growth rates of 159.5%, 41.7%, and 29.0% respectively. Net profit attributable to the parent company is projected to grow from 7.95 billion yuan to 13.82 billion yuan during the same period, with year-on-year growth rates of 154.2%, 36.0%, and 27.9% respectively [3] - The company is optimistic about the growth logic of its IP matrix incubation and operation platform and has initiated coverage with a "recommended" rating [3]

Core Viewpoint - Pop Mart is set to launch a trendy toy mobile phone in collaboration with a well-known smartphone brand, which has garnered significant attention from both toy enthusiasts and the digital community [1] Group 1: Collaboration Details - Pop Mart clarified that the upcoming mobile phone is not a self-developed product but a collaborative effort with a leading smartphone manufacturer [1] - The partner for this collaboration is Honor, a top domestic smartphone brand in China [1] - The collaboration will focus on Honor's 500 series, with the new product scheduled for release on January 19, 2026 [1]

Core Insights - Honor and Pop Mart are collaborating to launch the Honor 500 series, marketed as the "first trendy toy phone" set to be released on January 19 [1][2] - The collaboration is not a simple "sticker" marketing approach; it integrates Pop Mart's core IP MOLLY into the phone's design, system themes, boot animations, and ringtones [2] - Pop Mart has successfully developed multiple popular IPs, including LABUBU, MOLLY, and SKULLPANDA, with significant revenue growth projected for 2025 [2][3] Company Overview - Honor was established in 2013 as a sub-brand of Huawei, focusing on the young consumer market with mid-range smartphones priced below 3000 yuan [2] - In November 2020, Honor became an independent brand following its separation from Huawei and is currently pursuing an IPO [2] Pop Mart's Strategy - Pop Mart aims to maximize the commercial value of its IPs and established an IP licensing department in 2020 to facilitate cross-industry collaborations [2] - Recent collaborations include exhibitions and partnerships with various brands, indicating a strategy to diversify its revenue streams beyond single blockbuster products [3] Leadership Changes - Pop Mart has appointed a former executive from LVMH as a non-executive director to enhance its strategic direction towards luxury branding [4]

Group 1 - The core viewpoint expressed by Duan Yongping is that while he acknowledges the success of Pop Mart, he questions the sustainability of its business model and the long-term demand for its products [1][3]. - Duan Yongping highlights that the blind box concept may not be applicable to all products, suggesting that not every brand can successfully implement this model [1]. - He emphasizes that the emotional value associated with products like Pop Mart's offerings is significant, but he personally does not understand the broader appeal of such products [3]. Group 2 - The timing of Duan Yongping's comments is notable, as they coincide with a significant decline in Pop Mart's stock price, which was reported at 197.00 HKD per share, with a total market capitalization of 264.56 billion HKD as of January 12, 2026 [4]. - Pop Mart's stock price had previously reached a high of 335.40 HKD per share on August 26, 2025, with a market cap exceeding 450 billion HKD, indicating a substantial drop in value [4].

Core Viewpoint - Renowned investor Duan Yongping expressed skepticism about Pop Mart's business model, questioning the long-term demand for its products and suggesting that if investors believe in sustained demand, it could be a good investment opportunity [1][3][9] Company Performance - As of January 12, 2026, Pop Mart's stock price was HKD 197.00 per share, with a total market capitalization of HKD 264.56 billion, down from a peak of HKD 335.40 per share and a market cap exceeding HKD 450 billion in August 2025 [3][11] - The stock has declined over 41% in less than five months, resulting in a market value loss of approximately HKD 185.8 billion [6][14] Financial Results - For Q3 2025, Pop Mart reported a revenue increase of 245% to 250% year-on-year, with Chinese market revenue growing by 185% to 190% and overseas market revenue increasing by 365% to 370% [8][16] - In the first half of 2025, the company achieved revenue of CNY 13.88 billion, a year-on-year growth of 204.4%, and an adjusted net profit of CNY 4.71 billion, up 362.8% [8][16] - The founder, Wang Ning, projected full-year revenue for 2025 to be no less than CNY 30 billion, emphasizing the importance of sustainable growth and data management [8][16] Market Sentiment - The market sentiment has been shaken by the declining market premium of core IPs like Labubu and short-selling pressures, despite ongoing overseas expansion and expected strong net profits for 2025 [6][14] - Morgan Stanley reported that Pop Mart is transitioning from explosive growth to sustainable growth, predicting a significant slowdown in revenue growth for Labubu in 2026 [8][16]

Group 1 - The core point of the article is that Pop Mart is collaborating with a well-known smartphone brand, Honor, to launch a co-branded "trendy toy phone" featuring its IP "Molly," rather than developing its own smartphone [2][3] - The collaboration will involve deep co-creation in product definition, with the phone based on Honor's mid-range 500 series, which has a starting price of 2,699 yuan [2] - The co-branded phone will include full-chain customization from ID design to packaging, and will come with a gift box featuring a Molly figurine and a custom phone case [2] Group 2 - Pop Mart's latest financial data shows a revenue growth of 245%-250% year-on-year for Q3 2025, with overseas market growth reaching 365%-370% [3] - Despite strong financial performance, Pop Mart faces challenges in the secondary market, where some new blind boxes have seen price drops, indicating a compression of premium space [3] - The collaboration with Honor is seen as a potential strategy for Pop Mart to find a second growth curve beyond blind boxes, with the success of this partnership to be evaluated after the product launch on January 19 [3]

Group 1 - The core message is that Pop Mart is not developing a mobile phone but will collaborate with a well-known mobile brand for an IP co-branding project [1] - Morgan Stanley reports that Pop Mart is transitioning from a phase of explosive growth to sustainable growth, predicting a significant slowdown in revenue growth for Labubu by 2026, with diversification beyond a single hit product [3] - The latest financial report indicates that in Q3 2025, Pop Mart's overall revenue increased by 245% to 250%, with a 185% to 190% increase in the Chinese market and a 365% to 370% increase in overseas markets [3] Group 2 - For the first half of 2025, the company achieved revenue of 13.88 billion yuan, a year-on-year increase of 204.4%, with adjusted net profit reaching 4.71 billion yuan, up 362.8%, and profit attributable to shareholders at 4.574 billion yuan, a 396.5% increase [3] - The founder of Pop Mart, Wang Ning, stated that the company expects full-year revenue for 2025 to be no less than 30 billion yuan, emphasizing the importance of growth health and the details behind big data growth [3]

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the China IP retail and toy industry, specifically highlighting companies such as Pop Mart, Miniso, and Bloks [7][8][9]. Pop Mart - **Sales Performance**: Pop Mart's online sales growth in China decelerated in December due to disciplined supply release, but an acceleration in supply was noted in January, which is expected to support growth [11][12]. - **New Product Launches**: The "Have a Good Run" plush toy series launched in January sold out quickly with a disciplined volume release of approximately 30,000 units on Tmall and Douyin [10][11]. - **Secondary Market Performance**: The secondary market price performance for non-secret SKUs showed mixed results, with premiums ranging from -30% to +50% [10][11]. - **US Market Trends**: In the US, credit card sales growth decelerated to approximately 300% in December from 500% in November, indicating a slowdown in growth [21][30]. Miniso - **Sales Growth**: Miniso's sales growth in Q4 is on track with management's expectations, showing solid performance in both China and the US. The company anticipates a positive outlook for the Chinese New Year (CNY) and Q1 2026 due to enhanced holiday operations and a relatively low base [8][27]. - **Product Launches**: New products under the Want Want IP were launched in late December, targeting the New Year season [10][11]. - **US Credit Card Sales**: Miniso's US credit card sales growth was approximately 75% in December, up from 60% in November, indicating strong holiday performance [27][29]. Bloks - **Product Launches**: Bloks accelerated new product launches in December, introducing over 30 product series, including new series for existing large IPs like Transformers and Kamen Rider [15][19]. - **Sales Performance**: Initial performance of new products, such as Kamen Rider's Legend version, has been positive, achieving over 10,000 sales volume on Tmall [15][19]. Market Trends and Outlook - **US Retail Sales**: The US holiday retail sales growth was reported at 3.9% from November 1 to December 21, showing slight improvement compared to the previous year [20]. - **Consumer Sentiment**: Easing comparisons and tax refund tailwinds are expected to support discretionary demand in the upcoming months [20]. - **Secondary Market Trends**: The secondary market prices for various IPs have shown stabilization, although some products continue to experience price declines due to increased supply [10][26]. Additional Insights - **Management's Outlook**: Both Pop Mart and Miniso management expressed a positive outlook for the upcoming CNY and Q1 2026, citing solid performance and operational preparations [10][27]. - **Risks**: There are concerns regarding the potential underestimation of revenue estimates for Pop Mart in North America due to changes in presale dynamics [47]. This summary encapsulates the key points from the conference call, providing insights into the performance and outlook of the companies within the China IP retail and toy industry.

Group 1 - The core viewpoint of the article is that while the investment value of Pop Mart is recognized, there are concerns regarding the long-term sustainability of its core demand [2][3] - Investor Duan Yongping acknowledges Pop Mart's impressive business performance and its successful creation of popular IPs like Labubu and Starry People, targeting young female consumers [3] - The blind box model employed by Pop Mart is attractive due to its gambling-like nature, encouraging repeat purchases as consumers seek desired items from a selection of 12 blind boxes [3] Group 2 - Duan Yongping expresses skepticism about the long-term necessity of Pop Mart's products, questioning the potential decline in demand over time [3] - He compares Pop Mart's products to luxury and art items, suggesting that their demand is based on emotional consumption, which is difficult to quantify and subject to trend changes [3] - Concerns are raised about the limitations of the blind box model, indicating that not all products can successfully adopt this approach, hinting at the dependency of Pop Mart's success on its IP and blind box strategy [3] Group 3 - Regulatory scrutiny has increased around the blind box model due to concerns over inducing excessive consumption, leading to tighter industry regulations [3] - The lifecycle of IPs is unpredictable, and while Pop Mart has developed a multi-IP strategy, its ability to continuously create new hits remains uncertain [3] - Duan Yongping emphasizes the need for Pop Mart to demonstrate its capability to navigate through "trend cycles" to become a long-term quality investment [3]

Core Viewpoint - Pop Mart has denied rumors of developing a mobile phone, stating that it will collaborate with a well-known mobile brand for an IP co-branded product targeting young consumers [1]. Group 1: Product Development and Collaborations - Pop Mart has no plans to develop a mobile phone but will launch an IP co-branded product with a popular mobile brand [1]. - The upcoming product is expected to combine elements of trendy toys with smart device functionalities, aimed at young consumers [1]. - Pop Mart's jewelry brand, POPOP, is set to officially open in September 2025, featuring products themed around its popular IP BabyMolly [1]. Group 2: Financial Performance - In Q3 2025, Pop Mart reported a 245% to 250% year-on-year increase in overall revenue, with China revenue growing by 185% to 190% and overseas revenue increasing by 365% to 370% [1]. - Revenue from offline channels in China grew by 130% to 135%, while online channels saw a growth of 300% to 305% [1]. - In the first half of 2025, the IP THE MONSTERS, including Labubu, generated revenue of 4.81 billion yuan, marking a 668% year-on-year increase and accounting for 34.7% of total revenue [2]. Group 3: Market Performance - As of January 12, Pop Mart's stock price decreased by 0.2%, trading at 196.6 HKD per share [3].