Lines Still Long, But Stock Down 50% — Where Did Pop Mart Go Wrong? | Business Play Teardown
Updated: Aug 5
At ICONSIAM, 7th floor, stands the largest Pop Mart branch in the world — bigger than any location in Beijing, Tokyo, Paris, or New York.
760 square meters · The first Pop Mart Café outside of China · A 4-meter-tall MOLLY dressed in traditional Thai costume · Interior design inspired by Thai architecture. Opened on August 8, 2025. Customers queued from early morning. Even I, the author, am among those who deeply love Pop Mart products.
This is no coincidence. Thailand is Pop Mart's #2 market internationally (behind the U.S. at #1), accounting for 10% of total overseas revenue — confirmed by Siriporn Plaengchanthuek, Country General Manager of Pop Mart Thailand.
But — over the past 90 days, Pop Mart's stock (9992.HK) has fallen over 35%, and more than 50% from its peak last August. U.S. sales in March 2026 dropped 45% YoY (Bloomberg, April 29, 2026). Meanwhile, global Google searches for "Labubu" have fallen approximately 90% from their peak in July 2025 (Business Insider, April 16, 2026).
At the same time — Pop Mart's Q1 2026 sales grew 75–80% YoY. The China market grew 100–105% YoY (SCMP, May 13, 2026). The Sanrio and FIFA World Cup collections sold out across all channels.
Both things are true — and they appear contradictory. Why is the stock falling when Pop Mart still looks like it's selling well?
The correct way to read Pop Mart's business is to understand that these two things are not in conflict — the company is simultaneously running 2 Business Plays, and those two Plays exist in a Mutual & Correlation relationship. In simple terms: the outcomes of business strategies don't always move in the same direction — they can move in opposite or completely conflicting directions.
What is a Business Play?
"A Business Play is a set of business decision strategies — co-created by experts and AI — delivering scores and recommendations to capture opportunity and reduce risk in each business context."
At Power Ladder, we don't ask "is this company good or not?" We ask: "What Business Play is it running — and how does each Play score?"
For Pop Mart, there are 2 Business Plays that must be evaluated simultaneously — and they must never be evaluated separately.
Play 1: Retail Price Monitoring
In one direction, Pop Mart's CEO is already making the right calls:
Gross margin 72.1% (FY2025), expanded from 66.8% the prior year · Customers willingly pay premium prices
Net margin 35.1% · Operating leverage working at full capacity
Sanrio and FIFA collections sold out across all channels in China (Goldman Sachs report, April 2026) — demand still exceeds supply at current prices
Ad-to-revenue ratio dropped from 4.4% to 2.9% in Q1 2025, showing that growth isn't being bought — customers are coming on their own at the same price
All of this aligns perfectly with the 🐪 More Profitability with Customer Satisfaction Business Play.
The meaning of the More Profitability with Customer Satisfaction Business Play is: increase Profitability (P) while maintaining Customer Satisfaction (C) at a level that is improving — or at least not deteriorating.
So why is the stock falling? Profitability is not the concern for Pop Mart's CEO at all — because the Power Ladder team's Machine Learning (ML) analysis scored Profitability at 91 out of 100, and the current pricing is excellent, as people are still willingly queuing to buy.
But let's analyze more deeply: how is the Customer Satisfaction of "customers queuing today" different from "customers queuing in the past"?
Today's Queue ≠ Yesterday's Queue — 4 Layers of Evidence
Even though the surface looks the same (long lines · items selling out quickly · growing sales), when you dig beneath the numbers, the Customer Satisfaction signals of 2025–2026 tell a very different story from 2023–2024.
Layer 1 — Customer Base Structure Has Changed: From Collectors to Speculators
In Pop Mart's Q1 2025 report, the membership base grew to 59.12 million members, member contribution stood at 91.2% of sales, and the repeat purchase rate was 50.8% (Moonfox H1 2025 Analysis, September 24, 2025) — these numbers look good.
But at the 2025 annual meeting, management disclosed a more concerning figure: 49% of new members only know "Labubu 3.0" — they don't know any other Pop Mart IP at all (36Kr, April 2, 2026).
Half of the new customer base "doesn't love the Pop Mart brand" — they only "love Labubu." Once Labubu cools down, there's no reason for them to keep queuing like before.
Layer 2 — The Resale Market Has Collapsed: A Signal That Cultural Value Is Shrinking
Throughout 2024 and into early 2025, customers queued because they believed Labubu was a collectible with speculative value — Big Into Energy Labubu was selling on Whatnot for as much as 70 USD per box.
By late December 2025, resale prices for some Labubu series on Chinese second-hand platforms had fallen more than 50% (Sixth Tone, December 31, 2025). Meanwhile, a Thai reseller told Reuters: "The resale market for these toys in Thailand is declining very fast." (Reuters, October 22, 2025)
Once the product stops being a "speculative asset," speculative buyers disappear — and the queue out front is no longer the massive line that even I used to stand in.
Layer 3 — Google Trends and Social Engagement Plummet
Global Google searches for "Labubu" peaked in July 2025 and have since fallen approximately 90% (Business Insider, April 16, 2026).
As the number of locations in the Americas nearly tripled (from 22 branches in December 2024 to 64 in December 2025), the excitement of hunting for secret characters in blind boxes — which once drove genuine customers — has faded.
Layer 4 — Collector Community Starting to Complain: A "Product" Problem, Not Just a "Trend" Problem
On Reddit's r/PopMartCollectors, posts like "You Know What? I Think I'm Done With Popmart" have started appearing, summarizing the key complaints (Reddit, October 24, 2025):
• Price increases
• Quality control issues
• Damaged product compensation offered as a $3 coupon (not a replacement)
• Pop Mart reporting authentic Labubu listings on eBay to suppress the resale market-preventing real customers who wanted to recoup their costs from doing so
These are not the voices of "people bored with a trend" — they are the voices of genuinely loyal customers who are beginning to change their minds.
Diagnostic Question: Is the Company Trying to Extract Maximum Profit from Its IP?
Both Labubu and Molly, along with other characters, have continued to produce new collections. But what we're discussing today is that Pop Mart is re-releasing older collections for sale — which has disappointed resellers, because it turns what people once viewed as rare collectibles into ordinary toys that are no longer rare.
Drawing from Professor Clayton Christensen's Innovator's Dilemma theory from Harvard Business School — a concept he introduced in the 1990s — he made an interesting observation: the reason great companies of the past eventually disappeared was not because their leaders or CEOs made wrong decisions. In fact, those decisions were correct and sound given the business context at the time.
You might wonder: if the business decisions were good, why did the company fail? The simple answer is: because those decisions focused on maximizing sales of the core product — and the company naturally avoided any action that would cannibalize it. The classic example is Kodak, the film camera company. They tried to keep film cameras selling well because customers had to keep buying film rolls. They therefore blocked the sale of their own digital cameras because those generated less revenue — no film required.
I, Dithanon Khrutmuang, would add: this CEO decision may be excellent specifically in terms of More Profitability — scoring 91 points. But Customer Satisfaction scores only 53 points. The combined More Profitability with Customer Satisfaction Business Play score is therefore 72 points — and this is precisely why Pop Mart's stock price has a clear downward trend.
This means that increasing profit alone does not always mean the business is improving — especially for a business that relies heavily on Intellectual Property and Branding, like PopMart
Why Both Plays Must Be Evaluated Together — Mutual & Correlation
The Power Ladder framework applies the principle of Mutual & Correlation: when 2 Business Plays operate simultaneously within the same company → a decision made in one Play immediately sends force into the other Play.
Consider the decisions Pop Mart's CEO must make right now:
If the CEO cuts Labubu's price by 20% to stimulate declining U.S. sales → Retail Price Monitoring volume improves temporarily → Profitability collapses, and the resale market sinks even further
If the CEO cuts investment in new IP to protect margins → Retail Price Monitoring margin holds briefly, and the More Profitability with Customer Satisfaction Business Play remains intact short-term (under 1 year) → But this prevents CRYBABY/Twinkle or the next character from emerging, causing the More Profitability with Customer Satisfaction Business Play to gradually deteriorate over 18–24 months
Or expand into Sony Labubu film + theme park + Food and Beverage → Heavy investment short-term → Camel's Shadow Business Play lifecycle extension in the Disney model · Giving Retail Price Monitoring more runway for growth
Camel's Shadow Business Play The Camel's Shadow Business Play is: a strategy for building substantial business profit using Intellectual Property (IP).
The CEO cannot choose a winning Play in isolation — Mutual & Correlation forces every decision to impact both sides simultaneously.
This is something most Thai Mid-SME owners don't think about.
Lessons for Thai SME Business Owners
You're not running a 170-billion-baht company. You're running a Thai SME with annual revenue of 50–500 million baht. So why does Pop Mart matter to you?
Because the same framework applies — just at a different scale.
Right now, every Mid-SME is running 2 Business Plays beneath the surface revenue numbers — and almost no one is measuring both sides simultaneously.
On Snowflake, using Point of Sale data + LINE OA you already have — you can run:
Keep Retail Price Monitoring within the More Profitability with Customer Satisfaction Business Play framework (price discipline + margin):
Diagnose red line danger signals by product category monthly. If thresholds are exceeded, the system automatically freezes new orders until stock clears. For example, Pop Mart went from 102 days to 83 days in Q1 2025 = the same signal, different scale — Moonfox
Gross margin by channel — monthly. Premium channels (LINE OA / loyalty / boutique) should maintain higher margins than mass channels. If convergence occurs = signal that the More Profitability with Customer Satisfaction Business Play is deterioratingProfitability with Customer Satisfaction Business Play ตกต่ำ
Ad-to-revenue ratio — if this must rise to maintain the same growth, it means customers are beginning to be dissatisfied with the product. Check IP and brand health next — it means the price you've set can no longer actually be sustained. Margin pressure is coming and will force you to discount unwillingly
Check Your IP & Brand Health with the Camel's Shadow Business Play:
Top-5 SKU share of revenue exceeding 60% combined = warning zone. Exceeding 40% on a single product = 'Camel's Shadow' stress signal (for Pop Mart, Labubu at 38.1% = approaching this line)
'Single product' survey for every new customer — ask: "Which product brought you to us for the first time?" → If >40% name the same product → your brand awareness has narrowed to a single product. Pop Mart example: 49% know only Labubu = the same signal
Launch scorecard for every new product — measure month-1 conversion, month-3 repeat, month-6 contribution. If numbers drift down = your IP engine is misfiring → catch the signal before scaling stock orders
Pre-launch cohort test on a small LINE OA segment before scaling stock orders
Summary — Lessons from Power Ladder
Pop Mart is a Smart Camel running 2 Business Plays in a Mutual & Correlation relationship:
More Profitability with Customer Satisfaction Business Play (Profitability side wins · Customer Satisfaction side is deteriorating → combined score 72/100)
IP and Branding → Camel's Shadow Business Play scores 63 points, down from a previous high of 91 points (clearly under pressure)
The capital markets are reading this tension — which is why the stock has fallen 50% from its peak.
But it appears Pop Mart is using its existing cash to reinvigorate IP and Branding.
For example, the Sony Labubu film (directed by Paul King of Paddington/Wonka) = a bet that both Plays can be revived simultaneously — extending the IP cycle through narrative formats and giving the premium pricing more runway.
The deeper but useful lesson for Thai Mid-SMEs: every business is running more than one Business Play · every Play has a score · Mutual & Correlation means the Play you're ignoring will drag down the Play you're proud of — without you even noticing.
What you're seeing here is Pop Mart at billion-dollar scale — but the same mechanism runs on a business your size too.
This is the business diagnosis that Power Ladder helps you build — not for a 170-billion-baht retailer in Beijing, but for Mid-SMEs in Thailand and Singapore, right now, where I can step in and help your business today.
If you enjoy content like this, please like, share, and follow us. Power Ladder now has an Interactive Quiz where you can put yourself in the CEO's chair at Pop Mart — how would you solve this problem? Click below to try it now.
Watch the full video version of this article on YouTube: https://www.youtube.com/watch?v=IozdmpbJJZs
In this video, we break down Pop Mart through the Business Play Teardown framework — exploring why the company can still report strong sales while its stock price continues to fall. We also invite you to step into the role of Pop Mart’s CEO and think through how you would respond to this business challenge.
Try the Framework on Your Business
🆓 Free — Business Play Plug-In (GitHub)
Download the Smart Camel Play Plug-In and run a Retail Price Monitoring diagnostic on your own POS data. No credit card required. No demo call needed.
Or email me directly:dithanon@powerladder.tech
Reference (Primary & Secondary Sources)
Pop Mart filings & official reports:
Bloomberg / Reuters / SCMP / CNBC:
State media :
Customer Sentiment / Resale Market:
This article is part of Business Play Teardown, a series analyzing leading publicly listed companies worldwide through Power Ladder’s frameworks. The Golden Equilibrium Framework, Magical Creature Theory, the definition of Business Play, and the principles of Mutual & Correlation are the intellectual property of Dithanon Khrutmuang.
Pop Mart’s financial information is sourced from filings published by the Hong Kong Stock Exchange (HKEX). Other information has been verified against primary sources as of 15 May 2026.
This document is intended solely for research and educational purposes and does not constitute investment advice. Any reference to share prices reflects the capital market’s interpretation of Pop Mart’s business performance and should not be considered a recommendation to buy or sell any securities.
Comments