Core Viewpoint - The recent decline in Pop Mart's stock price is linked to fluctuations in the secondary market for its popular LABUBU products, with prices dropping significantly for earlier generations and showing volatility for the newly released mini version [2][3]. Group 1: Market Dynamics - The drop in secondary prices is associated with Pop Mart's expansion of production capacity, which has increased supply significantly, with the current month's plush toy production equating to the previous year's total [3]. - The short-selling data for Pop Mart has surged, with shorted shares rising from nearly 300,000 on August 29 to over 6 million within a week, and the short-selling amount increasing from under 1 billion to nearly 2 billion [3]. - Similar market conditions were observed in June, where a buying frenzy for LABUBU led to stock price declines and increased short-selling, prompting Pop Mart to replenish stock and causing secondary market prices to drop [3]. Group 2: Stock Performance and Index Inclusion - Despite the recent stock price peak, which reached a new high on August 20, the launch of the new LABUBU series did not lead to a corresponding increase in stock price, with a decline of 20% noted by September 10 [4][5]. - On September 8, Pop Mart was included in the Hang Seng Index, which is expected to attract more investors and capital inflow, but also subjects the company to greater scrutiny [5]. Group 3: Long-term Strategy and IP Development - Pop Mart's strategy to increase production capacity aims to mitigate the chaos caused by scalpers, although this could impact long-term revenue and the company's commitment to "long-termism" [5]. - The CEO emphasized the importance of LABUBU becoming a world-class IP, suggesting that the true commercial value of an IP begins once it achieves global recognition [6]. - In 2024, Pop Mart's revenue reached 13.04 billion, with the LABUBU series alone generating 3.04 billion, reflecting a year-on-year growth of 726.6% [6]. Group 4: Competitive Landscape - Competitors like TOP TOY are beginning to capture market share, with TOP TOY reporting a revenue of 742 million in the first half of the year, a 73% increase, indicating a growing challenge for Pop Mart [7]. - The founder of TOP TOY highlighted that scalpers have become the primary customers in the collectible market, which complicates the supply-demand dynamics [7]. - The industry faces a long-term challenge of moving away from being "held hostage" by scalpers and returning to a business model focused on genuine consumer value [8].

Core Insights - The article highlights the significant growth and success of Pop Mart, particularly through its popular IPs like Labubu and Molly, which have driven impressive financial results in the first half of 2025 [1][2][4] - The company has achieved record-high gross and net profit margins, with gross profit margin reaching 70.3%, comparable to luxury brands [2][7] - Pop Mart's revenue has seen substantial growth, with a 204.4% increase year-on-year, indicating strong market demand and effective business strategies [1][7] Financial Performance - For the first half of 2025, Pop Mart reported revenue of 138.76 billion yuan, a 204.4% increase from the same period in 2024 [1][7] - Gross profit reached 97.61 billion yuan, up 234.4%, with a gross margin increase from 64% to 70.3% [1][2] - Net profit for the same period was 46.82 billion yuan, reflecting a 385.6% year-on-year growth, surpassing the total net profit for 2024 [2][7] Market Expansion - Pop Mart's revenue distribution shows that 59.7% comes from China, while international markets contribute significantly, with a 439.6% increase in overseas revenue [7][10] - The company plans to expand its international presence, aiming to increase the number of overseas stores from 140 to over 200 by the end of the year [10][11] - The opening of flagship stores in key international markets, such as Thailand and Germany, demonstrates the company's commitment to global expansion [10][11] IP Strategy and Risks - The success of IPs like Labubu has raised discussions about the sustainability of their popularity and the risks associated with reliance on single IPs [4][12] - The company emphasizes its platform approach, aiming for a diverse range of IPs to mitigate risks and enhance overall brand health [12][15] - Pop Mart's management believes that the true commercial value of a world-class IP is just beginning to be realized, with potential for extensive product development [15]

Core Viewpoint - The company emphasizes the significance of LABUBU becoming a world-class IP, indicating that the value extraction of this IP is just beginning [1] Group 1: Company Performance - In the first half of 2025, the revenue from THE MONSTERS, including LABUBU, reached 4.81 billion yuan, representing a year-on-year growth of 668.0% [1] Group 2: Product Development - The CEO mentioned that while there are many categories and development directions to explore for LABUBU as a symbolic IP, product development will remain relatively restrained [1] - A mini version of LABUBU is set to be released this week, with potential applications in more diverse scenarios in the future [1]