Shares of Pop Mart International Group Ltd., the maker of the popular Labubu toy line, fell more than 5.5% Friday to their lowest level since May, after a livestream incident reignited scrutiny over its product pricing.
The Hong Kong-listed stock’s drop followed a viral clip in which a Pop Mart employee appeared to question the value of a blindbox item during a Thursday livestream, according to The Cover, a Chinese local media outlet. The product in question - a phone chain blindbox priced at 79 yuan ($11) - sparked backlash across social media.
On Xiaohongshu and Weibo, users criticised the company’s pricing, with one comment noting: "A string of these plastic beads costs less than two yuan, yet it’s the obsession of the young people” that has spoiled Pop Mart. Another user chimed in with the view that the employee was telling the truth and that Pop Mart’s products are expensive.
"The company is investigating the situation,” a Pop Mart spokesperson told Bloomberg News.
The controversy coincides with a broader cooling in secondary market prices of the Labubu series. As of Friday morning, Qiandao, a Chinese reselling and trading platform, showed a 16% drop in average prices for a 14-set box of mini Labubus over the past month - slumping below the official retail price of 1,106 yuan. Larger Labubu dolls showed single-digit declines over the same period.
The decline in secondary market premium may be related to the company’s increased supply and monetisation efforts, Goldman Sachs Group Inc. analysts, including Michelle Cheng, said in a note. High-frequency pricing data continues to impact market sentiment on intellectual property-driven brands, they noted.
Pop Mart’s shares have been under pressure in recent months and have slid about 38% since its late-August peak amid profit-taking and concerns about sustaining demand. Hailed as China’s hottest consumer stock, the Beijing-based firm rode a wave of demand for its toothy plush toys - especially the Labubu character.
Sanford C Bernstein analysts, including Melinda Hu, expect Labubu volumes to peak in 2026/2027, while pointing to risks tied to IP concentration. "The probability of replicating such success with new characters is remarkably low,” they had written in an Oct. 16 note.
However, Morgan Stanley noted that Twinkle Twinkle, another IP character from Pop Mart, is rivalling Labubu in demand, but faces product shortages. - Bloomberg
