Core Insights - HERE Qimeng Island's WAKUKU was awarded "2025 Most Commercially Valuable Trendy Toy IP" at the "Crossing Cycles, IP as Core" event, highlighting the industry's recognition of its IP commercialization capabilities [1][2] - The company focuses on the incubation and value enhancement of trendy toy IPs, utilizing an original IP matrix and integrating online and offline channels to maximize commercial value [1] Financial Performance - WAKUKU contributed over 89 million yuan in revenue during the first quarter of the 2026 fiscal year, accounting for over 70% of total revenue, demonstrating strong market validation of its hit-making ability [1] Strategic Initiatives - HERE Qimeng Island is committed to deepening its "IP commercialization platform" strategy, aiming to strengthen the influence of leading IPs while incubating new IPs with cultural significance and market potential [2] - The company is actively engaging in cross-industry collaborations with sectors such as sports, fashion, and cultural tourism to extend the commercial scenarios and longevity of its IPs [1] Industry Recognition - The "Half-Month Award," initiated by Lei Bao, aims to recognize companies, IPs, and cases with outstanding commercialization achievements in the IP sector, showcasing industry pioneers and exploring pathways for China's IP industry [2]

Core Viewpoint - The article discusses the transformation of HERE (formerly known as Quantum Song) from an adult education company to a pure-play trendy toy company, highlighting its financial performance and strategic direction in the competitive market of emotional consumption and cultural assets [3][5][7]. Financial Performance - In the first quarter of fiscal year 2026, HERE achieved revenue of 127 million RMB, a 93.3% increase quarter-over-quarter, surpassing the previous guidance of 100-110 million RMB [5][6]. - The company raised its revenue guidance for the second quarter to 150-160 million RMB, indicating confidence in short-term growth [5]. - The company reported a net loss of approximately 25.8 million RMB for the quarter, which has widened compared to the previous quarter [13]. IP Portfolio - As of September 30, HERE owns 17 IPs, including 11 proprietary IPs, 4 exclusive licensed IPs, and 2 non-exclusive licensed IPs [5]. - The top three performing IPs are WAKUKU, generating approximately 89.73 million RMB in revenue, ZIYULI with 20.76 million RMB, and SIINONO contributing 12.89 million RMB [5][6]. Market Dynamics - The global collectible toy market reached 57.1 billion USD in 2023 and is expected to grow to 69.6 billion USD by 2028, with the Chinese IP toy market projected to grow from 57.8 billion RMB in 2025 to 91.1 billion RMB by 2028, reflecting a compound annual growth rate of over 17% [9][10]. - The market is highly fragmented, with nearly 80% of the Chinese market being occupied by numerous small brands, presenting both opportunities and competitive risks for new entrants like HERE [9][10]. Strategic Approach - HERE's strategy involves a dual approach of online and offline channels to enhance brand visibility and IP recognition, leveraging social media platforms for marketing [11][12]. - The company has expanded its offline presence with flagship stores and pop-up events in major cities, aiming to create an immersive brand experience [12]. Production and Supply Chain - HERE's plush blind box production exceeded 1 million units in August, marking a more than 20-fold increase since the beginning of the year, indicating a robust and flexible production system [6][13]. - The rapid scaling of production capacity is crucial for responding to market demands and supporting the launch of popular products [6]. Challenges Ahead - Despite initial success, HERE faces challenges in maintaining profitability and managing operational costs, which have significantly increased during its expansion phase [13]. - The company must evolve from creating a single hit product to establishing a sustainable system capable of consistently producing successful products [13].