Bubble Mart's financial report for the first half of 2026: revenue growth but less than expected, overseas markets face challenges

China News Service, August 22 (Zuo Yuqing) Recently, Bubble Mart handed over its report card for the first half of 2026.

During the reporting period, Bubble Mart achieved revenue of 17.17 billion yuan, a year-on-year increase of 23.8%; adjusted net profit was 5.16 billion yuan, with an adjusted net profit margin of 30% and a gross profit margin of 69.7%.

Despite the seemingly excellent financial report, both revenue and net profit failed to meet capital expectations. On the 21st, Bubble Mart closed at HK$149 per share, down 3.06%, with a market value of HK$198.4 billion, which has shrunk by more than 50% from its historical high in August 2025.

Behind this, investors’ expectations for Bubble Mart’s overseas market performance have been disappointed.

After "luck" no longer exists

2025 can be said to be the “year of the gods” for Bubble Mart. Bubble Mart's full-year revenue in 2025 was 37.12 billion yuan, a year-on-year increase of 184.7%, and its adjusted net profit was 13.08 billion yuan, a surge of 284.5%. LABUBU's THE MONSTERS alone achieved full-year revenue of 14.16 billion yuan. Overseas revenue was 16.27 billion yuan, accounting for 43.8%, and the American market increased more than sevenfold in one year.

Founder and CEO Wang Ning commented: "We were indeed lucky last year. A lot of unexpected traffic brought about very rapid performance growth."

But luck doesn't come every year.

In the first half of 2026, Bubble Mart’s overseas market revenue was 4.972 billion yuan, a year-on-year decrease of more than 11%. In the once most dazzling American market, the number of stores increased by 22 in the first half of the year, but revenue fell by 16.5%. The overseas Asia-Pacific region fell by 9.7%. The only overseas region that maintained growth was Europe and other regions, with a year-on-year growth of 5.9%.

Bubble Mart attributed this to "the fading of external traffic dividends" and "the return of core IP popularity to normal."

The financial report shows that the THE MONSTERS family to which LABUBU belongs had revenue of 4.45 billion yuan in the first half of this year. Although it is still the largest IP under Bubble Mart, it fell 7.5% year-on-year.

The sales forecast deviation caused by rapid growth in 2025 also causes Bubble Mart to face inventory problems. The financial report shows that Bubble Mart’s inventory increased from 5.473 billion yuan at the end of 2025 to 6.102 billion yuan, and the turnover days increased sharply from 123 days to 201 days.

"The pressure in the first half of this year was much greater than we expected, and we did face many difficulties and challenges. This was not expected before." Wang Ning admitted at the performance meeting that there is a high probability that this year will not achieve the 20% annual performance growth target set at the beginning of the year.

It’s not just LABUBU that’s not popular anymore

What’s the problem with Bubble Mart?

Looking back in 2025, Bubble Mart will have great success in overseas markets with LABUBU, which is also an important reason for its sharp increase in performance last year.

From Southeast Asia to European and American markets, LABUBU took the world by storm in less than half a year. In April 2025, when LABUBU's third-generation vinyl plush pendant "Front High Energy" series was launched globally, the official app of Bubble Mart once topped the US APP STORE shopping list online.

The overwhelming traffic on overseas social media and the love of international superstars such as Rihanna, Brad Pitt, and Beckham have made this craze even more unstoppable. In November 2025, LABUBU appeared in the parade of floats on the streets of Manhattan, New York, together with global classic IPs such as Super Mario, Mickey Mouse, and Buzz Lightyear, becoming the first Chinese brand in a century to board a float with an original trendy IP image.

So, is LABUBU’s popularity waning overseas the only reason why Bubble Mart’s performance fell short of expectations?

In Wang Ning’s view, last year was a year when one beauty covered up all the ugly and there were many problems, especially in all aspects of operations.

"When customers go to the store, they are either sold out, rushing to buy, or queuing for a long time. We don't think that is the normal state that should be there. During the operation process, whether it is from the supply chain operation link, the store operation link or the personnel management link, many areas will have problems of this kind." He said that Bubble Mart is working on solving problems in all aspects this year.

Pop Mart Chief Operating Officer Sid revealed at the performance meeting that a large number of Pop Mart's overseas employees were new employees last year, and their brand awareness is limited to Labubu 3.0, and their professional accumulation is not even as good as that of ordinary users. Under the premise that the trendy play culture, user base, and team capabilities have not been fully developed, the overseas market has experienced a short-term sales explosion, and the performance has dropped significantly after the subsequent traffic ebbs, which has become the biggest challenge for the current overseas business.

These problems were obscured by dazzling numbers during the period of rapid growth. Once growth slows down, all shortcomings are exposed in the spotlight.

Who can replace Labubu?

There is no shortage of stories about becoming gods overnight in the fast-moving consumer goods field, and there is no eternal top-notch IP. It is expected that the popularity of LABUBU will ebb, but the question is, after LABUBU cools down, what will Pop Mart’s “Trendy Toy Empire” rely on to support the expectations of the capital market?

Judging from the financial reports, Xingxingren may be the "successor". In 2024, Bubble Mart signed a contract and officially launched the "Xingxingren" IP. The first blind box of this IP was sold out immediately after it was launched, and its revenue exceeded 100 million in the year of launch. In the first half of this year, Xingxingren’s revenue reached 2.65 billion yuan, a year-on-year increase of 580.6%, and its revenue share jumped from 2.8% to 15.4%, making it the second largest IP of Bubble Mart.

It is worth mentioning that on the night when Bubble Mart released its financial report, Xingren’s new blind box was officially released. It was available online through multiple channels in seconds, and the hidden model sold at a premium of nearly 13 times in the second-hand market. This "baby is hard to find" scene seems familiar to last year when LABUBU was the most popular.

However, it remains to be seen whether Xingren can continue to output commercial value on a global scale like LABUBU. What's more, taking over the baton does not mean that it can be replaced. The current revenue of THE MONSTERS is still 1.7 times that of Starman, and the IP concentration of Bubble Mart is still high.

Bubble Mart is also constantly testing new IPs. Since the second half of 2025, Bubble Mart has obviously accelerated its pace of launching new products. In the past, a new IP was launched in about half a year, but it was reduced to less than two months, and one was even officially announced in a week. However, the market's enthusiasm has obviously not kept pace.

In December 2025, Bubble Mart launched a new IP focusing on cuteness and healing-Supertutu. This product, which will be launched on January 1, 2026, obviously has high hopes for Bubble Mart. However, this series of blind boxes was met with failure immediately after its launch.

More than two months later, another new IP of Bubble Mart, "Merodi after school", also met with lukewarm reception. On February 27, the first day of release of “Merodi After School” received a lackluster market response. Just that night, Bubble Mart once again officially announced the new IP "Key A". The frequency of new IP launches hit the fastest record in recent years. However, the IP product encountered negative reviews before it was officially released.

In June this year, LABUBU's new "Retro Barber Shop" series was released. Once some regular models were released, the second-hand market fell below the initial selling price.

Bubble Mart, which incubates IP in batches, still has difficulty winning the next “LABUBU”.

How long will it take to "adjust"?

Regarding the development of Bubble Mart, Wang Ning has repeatedly emphasized that 2026 will be the "year of adjustment", sales are not the main goal, and overly aggressive sales or expansion strategies will not be adopted to forcefully complete the goals.

Judging from the feedback from the performance meeting, Bubble Mart will start to solve the inventory problem. Overseas stores will focus more on quality rather than quantity and continue to enrich the product matrix.

Although Wang Ning said that the decline in LABUBU's sales ratio means that Bubble Mart's IP structure is healthier, Bubble Mart is obviously unwilling to let this most profitable IP continue to decline.

In a conference call in May this year, Bubble Mart announced that it would launch two new products around LABUBU in the second half of the year. A live-action animated film cooperating between Bubble Mart and Sony Pictures is also in progress, and will be directed by Paul King, director of the "Paddington Bear" series. As for the city park, the theme areas surrounding IPs such as THE MONSTERS and DIMOO have just been expanded. In addition, LABUBU also appeared as a special guest at the opening ceremony of the 2026 US-Canada-Mexico World Cup, once again creating a wave of popularity.

At the same time, Bubble Mart is also pushing Star People to move outward. Side said that Xingxingren has become a phenomenon-level IP in China and most Asian countries. In the second half of the year, Xingxingren's costume performances will be brought to Singapore and more countries and regions. The expansion of overseas markets has just begun.

After soaring all the way, Bubble Mart, which wants to slow down and slowly "adjust", will still need time to verify whether it can prove that it is not a company that became popular by luck.