What’s next for Lovebu? Inside Pop Mart’s next growth strategy

Popmart knew Lovebu would be a hit, but they never expected the furry little elf monster to take over the world. Then, almost as quickly, the question “Will the bubble burst soon?” followed.

It’s a pressure Pop Mart has learned to live with. Shi De, the Beijing-based toymaker’s chief operating officer, said investors have been asking such questions about Luvbu, pouting Molly and blushing Twinkle Twinkle for years.

The Love Bu boom subsided after that, Pop Mart”‘s stock price has fallen about 40% from its peak in August. Thanks to Labubu, Pop Mart’s revenue and net income in 2025 increased by 185% and 309%, respectively.

But after Wednesday’s earnings release, the stock fell more than 22% as investors weighed whether the company could sustain its momentum beyond the initial hype.

CEO Wang Ning said at the financial results conference that “Pop Mart has more than just Labubu,” and tried to reassure the market by likening expectations for the company to “a rookie racing driver who is suddenly thrown onto an F1 circuit.”

No one knows how long the character’s popularity will last, Shi said. But Popmart makes it clear how people decline. That’s when you stop investing.

“We learned this from Disney. There’s a very simple truth at Disney: continuous investment,” the 38-year-old executive told CNBC this month. “If we continue to make the right investments,[intellectual property]can survive.”

For Pop Mart, that means going global and building worlds around its characters, including movies, theme parks, and fashion tie-ins. The motive is not a vanity project, but a commercial bet aimed at embedding its products, like Labubu, in people’s lives.

“Of course, we hope that Lovev lasts 80, 90 or even 100 years,” said See, noting that Mickey Mouse was born almost a century ago. “But this road is very long.”

Labubu’s story of seemingly overnight success actually began with years of quiet hard work.

Popmart first released Lovebu as part of its Blind Box collection in 2019 after licensing the character from Hong Kong-Dutch artist Ka-Shin Lung, who created the character for a picture book series several years ago. The team at Pop Mart spent nearly two years developing and prototyping the design for the wildly popular plush product.

This painstaking process was no exception. According to Shi, Popmart searches for artists around the world every year, but most artists are not selected. The small number of people who contract with the company go through a long development process, including internal competition, before the company decides where to focus its resources.

The shortlist is intentionally kept small. “We aim to help four, five, maybe six IPs grow to be truly world-class,” Shi said, citing Disney’s strategy of having a small number of characters generate the majority of the value.

Founded in 2010 as a retailer of trendy products for young consumers, Pop Mart pivoted in 2016 to focus on its first major IP: design toys. That’s Molly, a wide-eyed, slightly grumpy girl created by Hong Kong artist Kenny Wong.

He first sketched her in 2006, after meeting a girl while painting her portrait at a fundraiser. Wearing glasses and loudly introducing herself as Molly, she looked at him “a little stubbornly and nervously” — and Wong saw himself in her. He told CNBC that he wanted to design a character that said, “We may not be perfect in this world, but we are unique.”

Once the product is introduced to the market, the process begins like clockwork. Pop Mart closely tracks sales and social media data. The new range will go on sale on Friday, and sales figures by Sunday will show whether the product has any traction. Operating our own stores and online channels keeps the feedback loop tight. An agile supply chain means you can scale up or down orders quickly.

“We don’t really make predictions; instead, we continually adjust our products based on data,” Si says.

But data alone can’t explain why certain characters resonate.

Si doesn’t know what the next big thing will be after Labubu. We also don’t think it’s about dissecting the zeitgeist.

“With all of our products, not just Labubu, but Molly and other IPs, everyone doesn’t necessarily feel the same way when they look at it,” he said.

He likened it to visiting a museum. People walk past the paintings until someone stops. What moves us varies from person to person. Pop Mart’s job, he believes, is to continue disseminating designs, stories, and experiences, and to make encounters come true.

This thinking also influences how the company approaches artificial intelligence. Although Pop Mart uses AI to streamline things like customer service and coding, Shi said it will continue to rely on human judgment when it comes to art and understanding human emotions.

Popmart says the company is in a phase of global expansion and diversification, and its products are no longer just toys. Mr. Shi said markets outside mainland China are expected to account for about 44% of PopMart’s revenue in 2025, with further growth in contributions from the United States and Europe.

The stakes of staying relevant are high. HSBC said repeat customers who rushed to buy Lovebuses during a time of tight supply contributed to a surge in revenue in mainland China last year. Popmart then increased production to curb scalping, and resale prices subsequently fell.

As the LuvV craze subsides, HSBC last month cut its forecast for PopMart’s sales growth this year from about 30% to less than 24%, and expects profits to fall 11% to 13% in 2026-2027. The bank added that it remains confident in the company’s ability to develop new IP and go global beyond Labv.

Other growth initiatives include partnerships with: Uniqlo and a Paris-based leather goods company. Moynat. PopMart has also expanded into jewelry, with some of Love’s gold necklaces selling for more than $2,000. This month, the company partnered with Sony Pictures and filmmaker Paul King to bring Love to the big screen.

But the theme park may be the company’s most ambitious project. Mr. Shi called them “big dreams” for PopMart.

Popland in Beijing is still in its early stages and is undergoing reconstruction and expansion. The goal is “360-degree immersion,” Shi said. That means more live performance and storytelling so people go home wanting to know more. Watch the video. Purchase the product. Please fall in love with them even more.

That diversification is also a hedge. Regulators in China and Singapore have introduced or are planning stricter rules for the sale of blind boxes, reflecting growing concerns about their addictive nature and gambling-altering appeal. Mr. See said the company accepts these rules.

Geopolitics is forcing the company to adapt.

As U.S.-China trade tensions escalate, PopMart diversified its production into Vietnam and throughout Southeast Asia. However, with tariff rates constantly fluctuating, the company has shifted its focus to supply chain efficiency rather than tariff strategy, Si said.

Popmart is also cited as an example of China’s soft power. Popmart is a consumer brand from Beijing that has gained real cultural traction in the West, but few Chinese companies control it. Si wants to go beyond that.

“I see a lot of media trying to tie us closely to politics. OK, first of all, you can’t avoid the fact that we are a Chinese company,” he said. “But we want to be a brand that connects artists around the world with fans around the world.”