Main points
- Shares of Pop Mart International Group fell 20% after announcing its 2025 earnings, despite a 185% increase in revenue to 37.12 billion yuan.
- The phenomenon of the popularity of Labubu toys is associated with emotional consumption, as they help people maintain psychological stability in times of uncertainty.
Labubu manufacturer is losing a lot of money / AP
Shares of Pop Mart International Group, maker of the viral Labubu toy, have suffered their biggest drop in a year, all because of a single company action.
How and why did Pop Mart shares fall?
The stock fell after the company reported earnings for 2025. The shares fell by 20%, Reuters writes.
The Beijing-based company said its revenue in 2025 rose 185% year-on-year to 37.12 billion yuan ($5.38 billion), sending its shares plummeting.
Wang Ning, chairman and CEO of Pop Mart, said the company expects revenue growth of at least 20% year-on-year in 2026.
In other words, thanks to a global wave of demand for plush toys, bag charms, and collectibles, Pop Mart has transformed from a local merchandise retailer into one of the country's most consumer brands, continuing to grow in popularity and expand abroad.
Interestingly, the company's revenue in 2025 almost tripled compared to the previous year to 37.12 billion yuan from 13.04 billion yuan.
Why did Labubu become popular?
Their price ranges from a modest $8.99 to thousands of dollars for limited editions. But what's behind this surge in popularity? Why is Labubu now taking over social media and the hearts of millions, Aol says.
Analysts believe that the Labubu phenomenon is part of a broader phenomenon, which is emotional consumption. In times of uncertainty, people are looking for ways to maintain psychological stability. And now, unexpectedly, a toy with a cartoonish look becomes this way.
Pop Mart toys, including Labubu, satisfy this very need – to be moved, to be distracted, to feel something tender and understandable,
– said Sean Raine, founder of China Market Research Group.
According to him, consumers are indeed saving money, but at the same time spending it on things that give them a good mood, like Labubu.
The popularity of Labubu is not limited to the domestic market of Asia. They are also actively promoted by Western stars. The dolls have appeared in the hands of Rihanna, Kim Kardashian and David Beckham. After each mention in the media or social networks, the price of rare Labubu increases by tens or even hundreds of dollars.
What else is known about Labubu?
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In November 2025, the Swedish Chemicals Agency found high levels of the banned substance DEHP in Labubu toys. Customs seized more than 5,300 pirated Labubu toys, popular due to high demand, which contained toxic substances banned in the EU.
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Pop Mart International Group Ltd. reported a 250% revenue growth in the third quarter of 2025 thanks to the popularity of Labubu toys. Despite record sales figures, experts warned of a decline in demand for Labubu, which led to the loss of about $13 billion in capitalization in September.
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Luxury brands such as Louis Vuitton, Tiffany, and Loewe have begun using toy characters to attract a younger audience and refresh their image. Such collaborations, in particular with the currently popular brand Labubu, are designed to refresh their image and attract a younger audience.