Pop Mart sales fall as Labubu demand weakens across China and overseas markets

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Pop Mart sales drop as Labubu demand fades

Highlights

Pop Mart reported a 45–50 per cent year-on-year sales decline for Q3 2025, driven by fading demand for Labubu.
Overseas sales dropped sharply, with Americas revenue falling 70–75 per cent and Europe and other regions down as much as 55 per cent.
Pop Mart's market cap is now about $22bn, more than half below its August 2025 peak, amid cooling secondary market prices and weak consumer sentiment.

Quarterly decline deepens after Labubu boom

As reported by Financial Times, Pop Mart said in an update filed with the Hong Kong Stock Exchange on Tuesday evening that sales decline by 45 per cent to 50 per cent in the three months to the end of September from a year earlier.

The Beijing-based company rose rapidly on global demand for Labubu, a furry troll-like doll that helped drive its valuation sharply higher last year. Celebrity endorsements from David Beckham and Blackpink star Lisa lifted the toy's profile, but the group is struggling to persuade investors that other products can offset softer demand as enthusiasm for Labubu fades.

Revenue is pulled down most heavily by overseas weakness. Sales from the Americas fall by between 70 per cent and 75 per cent, revenue from Europe and other regions declines by as much as 55 per cent, and sales in mainland China are down 25 per cent to 30 per cent year on year.

Investor pressure grows amid weaker consumer demand

At the height of the buying frenzy, Pop Mart's market capitalisation stands at more than double that of Hasbro and Mattel combined. Its blind-box model, with many products typically selling for about $10 in China, encourages repeat purchases because buyers do not know which character they receive until opening the package.

That momentum has weakened as secondary market prices fall, reinforcing expectations that demand for Labubu is cooling. In one instance last year, a buyer paid Rmb1.2mn, including fees, for a human-sized Labubu at an auction in Beijing, but Pop Mart's shares are now down more than half from their peak in August 2025, leaving the company with a market capitalisation of about $22bn.

The update also arrives as consumer sentiment in China remains weak, a significant issue for a market that accounts for more than half of Pop Mart's revenue in 2025. In the U.S., where the company is seeking new growth, consumers are also facing elevated prices and affordability pressures.

Rising U.S. toy prices ahead of the holiday season was the focus of our earlier report, which explained how import duties on Chinese goods and higher energy, shipping, and raw-material costs have pushed prices up faster than many other consumer categories. We also noted that these cost pressures are squeezing margins at major toymakers such as Mattel and Hasbro, leaving consumers facing elevated prices even as tariffs ease only gradually.

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