Pop Mart (9992 HK, HK$256.40, HK$344bn) 3Q25 beating expectations again

Pop Mart, a global retailer known for its popular IP Labubu, reported an impressive operational performance for 3Q25. Its total revenue grew by up to 2.5x YoY during the quarter compared to 204% YoY growth in 1H25. This implies that the full-year revenue guidance of RMB30bn (estimate growth of 231% YoY) mentioned in August may likely be too conservative.

Growth in most regions accelerated. In the China market, revenue grew 185%–190% YoY, up from 135% in 1H25, primarily driven by the rapid expansion of production capacity. Online channels revenue in this region was up 300-305% YoY (vs. +212% YoY in 1H25), while offline grew 130-135% YoY in 3Q25. Among overseas regions, the American market continued to lead growth with a 12.65–12.7x YoY surge, up from 11.4x YoY growth in 1H25. Europe and other regions achieved a 7.35–7.40x YoY growth. Meanwhile, Asia-Pacific region recorded a 170%–175% YoY increase, mainly due to high base last year.

A healthy trend towards IP diversification. Besides THE MONSTERS series (Labubu), other core IPs such as Twinkle Twinkle, SKULLPANDA, Molly, and Dimoo also delivered robust growth. The Halloween themed Why So Serious (including many popular IPs) sold out quickly after launch. During 1H25, THE MONSTERS represented only 35% of total revenue, demonstrating a healthy and diversified IP revenue structure. This balanced portfolio, together with the company's proven ability to cultivate new products, could help alleviate market concerns regarding over-reliance on a single IP.

Our view: Pop Mart is a leading IP platform supported by diversified IPs portfolio.  It is also strong in developing new IPs, and its targeted marketing strategies have proven successful. Looking ahead to 4Q25, the “Double 11 shopping festival” will coincide with the peak shopping season in North America. Driven by the launch of new seasonal products and enhanced production capacity, it is believed Pop Mart could sustain its strong growth momentum. The counter is trading at 20x FY26E P/E.