Investment Rating - The report does not explicitly provide an investment rating for the toy industry Core Insights - The Japanese toy market has experienced stagnant growth over the past 30 years, with a shift in consumer preferences leading to a decline in traditional children's toys and a rise in emerging categories like card games and hobbies [1][3] - The market for assembly toys has shown volatility, with significant growth driven by blockbuster products in the late 1980s, followed by a decline, but a long-term upward trend as the player demographic expanded from children to adults [1][4] - The integration of intellectual property (IP) into the toy industry began in the 1970s, fostering collaboration between content creators and manufacturers, which has been crucial for the development of derivative markets [1][6] - The adultization trend in the toy industry became prominent after the 1990s, leading to increased demand for collectible items and the emergence of niche categories [1][8] Summary by Sections Market Trends - The Japanese toy industry has seen a significant shift in market share over the past two decades, with new categories like children's card games and hobbies gaining prominence while traditional toys have declined [5] - The assembly toy market has experienced notable volatility, with peaks in the late 1980s followed by declines, but a long-term trend of growth as the audience has expanded to include adults [4][10] Company Strategies - Major companies like Bandai and Takara Tomy have adopted platform strategies to monetize IP through acquisitions, diversifying their revenue streams and enhancing their ability to withstand market risks [2][15] - Bandai has successfully integrated various business models, targeting different age groups with a diverse range of products, thereby mitigating risks associated with market fluctuations [16] IP Development - The report highlights the importance of IP in the toy industry, with successful examples like "One Piece" demonstrating how a single IP can evolve and generate revenue across multiple platforms [14][13] - The assembly model market features key IPs such as Gundam, which has shown consistent growth, while others like Mini 4WD have experienced fluctuating popularity [10][11]

Core Insights - The overall sentiment in the anime and IP market is mixed, with some IPs like "Demon Slayer" driving significant revenue growth, while others like "Ultraman" and "Attack on Titan" are experiencing declines in income [1][25][36]. Group 1: Market Performance - The second quarter of 2025 saw a decline in revenue for several major IPs, with "Demon Slayer" contributing to a 50% increase in sales for Sony's animation and gaming sectors [1][36]. - Guangzhou's Anime Star City reported a 32% drop in revenue for Q2, despite maintaining a high occupancy rate of 99.8% [2]. - Wangfujing Joy Shopping Center, after strategic repositioning, saw a 48% increase in sales for the first half of 2025, although it still reported a loss of approximately 114 million yuan [4][6]. Group 2: IP-Specific Developments - Bandai's "Gundam" IP achieved a record sales figure of 103.2 billion yen in the first half of 2025, driven by the release of a new TV series and related merchandise [10][13]. - "Ultraman" faced a 1.47% decline in sales, with domestic sales plummeting by 66.96%, although overseas sales grew by 45.29% [25][27]. - Toho Animation reported a 6.79% increase in sales, primarily due to the strong performance of "One Piece" and "Dragon Ball" in overseas markets [36][42]. Group 3: Strategic Initiatives - Wangfujing Joy Shopping Center is transforming into a "New National Trend Shopping Center" to cater to the diverse needs of the Z generation [6]. - Sony is enhancing its IP development capabilities through strategic partnerships, including a significant investment in Kadokawa and collaboration with Bandai Namco [60][62]. - Sanrio's multi-character marketing strategy has proven successful, with a 47.4% increase in sales, particularly in the Chinese market, where sales surged by 91% [75][86].

Core Viewpoint - The global IP economy is experiencing a significant surge, with major IP operators like Sanrio, Bandai Namco, and Nintendo seeing their stock prices reach historical highs, while Disney also achieved a near three-year high [1] Group 1: Performance of Major IP Operators - Sanrio's Hello Kitty, Bandai Namco's Dragon Ball, One Piece, and Gundam, along with Nintendo's Mario and Pokémon, are among the most recognized IPs in China [1] - The stock prices of these IP operators have shown a strong upward trend over a considerable period, with Sanrio's stock rising since June 2022 and Bandai Namco and Nintendo experiencing over a decade of growth [1] - Tsuburaya Productions, known for Ultraman, saw its stock price increase by over 1000% from January 2022 to August 2023, driven by the success of Ultraman card games in China [1][2] Group 2: Characteristics of Classic IPs - Classic IPs possess a "cross-cycle" capability, remaining relevant despite significant societal changes and evolving consumer habits [2] - The development of new products such as cards, building blocks, and other merchandise around these classic IPs has created new growth opportunities [2] - Disney exemplifies the importance of both sustaining classic IPs and developing new ones, with its iconic Mickey Mouse and the continuous introduction of new IPs through films and merchandise [2] Group 3: Development of IP Industry in China - China's IP industry has seen rapid growth in recent years, with original IPs like Nezha and Bubble Mart's LABUBU gaining market recognition [3] - However, transitioning from recognized IPs to "classics" remains a challenge for the industry [3] - A systematic and gradual IP operation strategy, as seen in many Japanese classic IPs, is crucial for endowing IPs with "cross-cycle" capabilities [3]

Group 1 - The toy and trendy play industry in China is experiencing explosive growth during the 618 shopping festival, with six merchants surpassing 100 million yuan in sales and nearly 100 merchants exceeding 10 million yuan [1][2] - The top IP products, including Sanrio and Ultraman cards, are performing exceptionally well, indicating a strong demand for Japanese IP in the Chinese market [2][3] - The overall market for trendy toys is expanding, with over 2,400 stores achieving triple-digit growth compared to the previous year [1][2] Group 2 - Major Japanese companies like Bandai, Sanrio, and Tsuburaya have reported significant revenue from their IPs, with Bandai's Dragon Ball generating approximately 9.44 billion yuan, a 35.6% increase year-on-year [4][5] - Sanrio's revenue in China has surged to 816 million yuan, with IP licensing contributing significantly to its growth [5][7] - Tsuburaya's Ultraman IP has generated 260 million yuan in licensing revenue in China, highlighting the strong performance of card sales [7][19] Group 3 - The competitive landscape of the trendy toy market is intensifying, with over 100 stores closing in the first half of 2025, indicating a significant shakeout in the industry [15][16] - The trend of localization is evident, as companies like Sanrio and Bandai are focusing on developing original IPs and collaborating with local partners to enhance their market presence [21][29] - The shift from content output to collaborative ecosystem building is becoming a key strategy for Japanese IP companies in China, aiming for sustainable growth in the competitive market [29][30]