On July 15, Bubble Mart, a Hong Kong stock star stock, known as the No. 1 trendy stock in China, announced a positive profit forecast.

The announcement stated that revenue is expected to increase by no less than 200% year-on-year in the six months ending June 30, 2025, and adjusted profits will soar by no less than 350%. Converted into specific figures, revenue in the first half of the year will exceed 13.7 billion yuan, and net profit will exceed 4.5 billion yuan-in just six months, it exceeded the 2024 full-year results.

However, the capital market responded with a contradictory attitude: although the stock price has surged by 194.79% year-to-date, the stock price fell by more than 4% the day after the release of the financial report, which far exceeded sellers 'expectations by 50%.

Phenomena-level hit LABUBU drives Bubble Mart's revenue to surge

In 2025, LABUBU has become a phenomenal symbol.

This Nordic elf with nine teeth has risen from a trendy entertainment circle to a global pop culture symbol with the help of spontaneous photos posted by stars such as Rihanna and Beckham.The MONSTERS series to which it belongs will crush MOLLY to top Bubble Mart IP revenue with revenue of 3.04 billion yuan in 2024, a year-on-year increase of 726.6%.The launch of LABUBU 3.0 in April 2025 will push the popularity to its peak: Seoul's Myeongdong store was forced to suspend sales due to a queue of thousands of people, British stores have launched current restrictions, and the first mint LABUBU was sold for more than one million yuan at the Yongle auction.This enthusiasm is directly transmitted to the financial side: revenue in overseas markets surged by 475%-480% year-on-year in the first quarter, with Americas growing by 895%-900%, and Europe growing by 600%-605%, pushing the overall gross profit margin to a historical high of 66.8%.

However, there are hidden hidden concerns behind the bright data.

LABUBU's explosive success has exposed the sharp contradiction between production capacity and demand-the monthly production capacity of the foundry has surged from 300,000 at the beginning of 2024 to 10 million units, and it is still difficult to meet demand. Company executives admitted that this expansion "far exceeds the operating experience of a normal company."What's even more difficult is that when competitors such as TOTOY and 52TOYS launched rubber-lined plush products one after another, the market began to question the essence of Bubble Mart's "seven-point-full" supply strategy as artificially creating scarcity.

Bubble Mart's response is revealed in two strategic lines.

First, horizontal expansion is reflected in the diversified defense of IP matrix: in 2024, the revenue of the four major IPs exceeded 1 billion yuan. In addition to LABUBU, MOLLY maintained 2.09 billion yuan of revenue through Disney, SKULLPANDA "temperature" series set a sales record of 790,000 sets, and CRYSTBABY achieved the fastest record of breaking 1 billion yuan with the concept of "emotional freedom".

Second, vertical deepening is reflected in breakthroughs in categories: extending from blind boxes to high-unit price and high-frequency consumption scenarios.POPOP, a silver jewelry brand priced at 500- 13,000 yuan, has been launched in Beijing and Shanghai. The independent Hirono Ono store has introduced high-end clothing such as cotton clothes. The joint names with if coconut water and Lay's potato chips penetrate into daily life.This layout has begun to show results-the proportion of manual revenue has dropped below 60% for the first time, and the plush category has increased by 1289% year-on-year.

Faced with "exploding" growth, the attitude of big banks wavers

Differences in capital markets are particularly striking at the moment.

Although JPMorgan Chase and Goldman Sachs maintained optimistic forecasts, they pointed out that net profit of 4.5 billion yuan only hit the lower limit of buyers 'expectations, implying that the previous surge in stock prices had overdrawn growth expectations.The deeper anxiety lies in whether the value of IP can travel through the cycle: Yang Aili, an analyst at CITIC Construction Investment, pointed out that LABUBU is expected to replicate the long tail effect of the SKULLPANDA temperature series that has continued to sell well for 30 months, but the implicit assumption in the current valuation is that LABUBU's popularity will be maintained at least Three years, and subsequent IP continues successfully.Bubble Mart's cautious attitude in IP licensing-licensing revenue accounted for only 4.5% in 2024, down 2.3 percentage points year-on-year-although it protects brand tonality, it may miss out on the dividends of Sanrio-style light asset expansion.

On April 22, Bubble Mart released the latest business update for the first quarter of 2025. In the first quarter, Bubble Mart's overall revenue increased by 165% to 170% year-on-year, of which China's revenue increased by 95% to 100%, overseas revenue increased by 475% to 480% year-on-year.

Regarding the reasons for performance fluctuations, Bubble Mart summarized three reasons: First, the global recognition of Bubble Mart brand and its IPs has further increased. Diversified product categories have promoted the Group's revenue growth, and the Group's revenue in all regional markets has achieved sustained rapid growth.

Second, the proportion of overseas revenue continues to increase, and changes in revenue structure have a positive impact on both gross profit and profit.At the same time, the effect of scale significantly increased profits.

The third is to continue to optimize product costs, strengthen expense control, and improve profitability.