Labubu Craze Cools: Pop Mart Sales Fall by Half as the Fluffy Monster Mania Fades

For a while, it seemed like Labubu could do no wrong. The small furry monster dolls with pointed ears, wide eyes and a mischievous grin flew off shelves around the world. Collectors queued for hours outside shops to buy them. People clipped them to handbags like fashion accessories. The company behind them, Pop Mart, became worth more than the biggest names in the toy business put together.

Now the frenzy is fading — and the sales figures show it. Pop Mart has reported that its revenue in the three months to the end of September fell by as much as half compared with the same period a year earlier. The fall was steepest outside China, with sales in the Americas down by at least 70 percent. For a brand whose rise was one of the fastest in the history of the toy industry, the reversal has been startling.

This is the story of how Labubu went from global obsession to cautionary tale — and what it means for the company that bet everything on one little monster.

What happened: sales down by half

Pop Mart disclosed the figures in a business update to the Hong Kong stock exchange on 27 October 2026. The numbers were unaudited, but they were stark.

Revenue for the third quarter of 2026 fell by 45 to 50 percent compared with the same quarter a year earlier. Every region went backwards, but the pain was worst overseas:

• Americas: revenue down 70 to 75 percent
• Asia-Pacific outside mainland China: down 65 to 70 percent
• Europe and other regions: down 50 to 55 percent
• Mainland China: down 25 to 30 percent

Even in China, the company’s home market, the picture was split. Sales through physical shops fell by only 5 to 10 percent, but online sales dropped by 45 to 50 percent. The shops held up; the internet did not.

The stock market reacted at once. Pop Mart shares fell as much as 6 percent to HK$123.80 on 28 October, their lowest level in 18 months. The shares have now lost more than 30 percent of their value since the start of 2026, and they sit more than 60 percent below their peak of about HK$337, reached in August 2025 at the height of the Labubu craze.

Analysts had expected a bad quarter — just not this bad. Jefferies, the investment bank, had forecast a drop of around 30 percent. JPMorgan had pencilled in a fall of about 37 percent. The real number was worse than both.

How Labubu took over the world

To understand why the fall matters, it helps to remember how extraordinary the rise was.

Labubu was created by Hong Kong artist Kasing Lung as part of his The Monsters series — a cast of imaginary creatures from a forest world. Pop Mart, a Beijing-based company founded in 2010, turned Labubu into a mass-market toy sold in sealed “blind boxes”: shoppers buy a box without knowing which figure is inside, which turns every purchase into a small gamble and encourages collectors to keep buying in search of rare versions.

The formula worked beyond anyone’s dreams. In the third quarter of 2025, Pop Mart’s revenue grew by 245 to 250 percent compared with the year before. Sales outside China rose by 365 to 370 percent. The plush Labubu bag charms moved from collectors’ shelves onto handbags around the world, and queues formed outside Pop Mart shops in city after city.

At its peak, Pop Mart was worth more than American toy giants Hasbro and Mattel combined. The company, which listed on the Hong Kong stock exchange in 2020, now runs around 500 shops in more than 30 countries alongside some 2,000 vending machines. Even after the recent falls, it remains one of the most valuable toymakers in the world, worth close to 24 billion dollars.

The craze changed lives. Ensito, a collector from North Carolina in the United States who goes by one name, quit his technology job in 2024 to make Labubu content full-time. He travelled as far as Italy and Spain to hunt down the latest releases, and spent more than $50,000 — about £37,000 — building a collection of more than 400 Labubus, a figure he told the BBC he was “embarrassed to say”.

But in recent months, Ensito’s once-viral posts about the furry monsters have struggled to find an audience. His attention has moved on to other trends, including Hello Kitty and squishy toys. He is not alone. Across social media, the Labubu moment looks like it is passing.

Why sales are falling

Pop Mart’s chief operating officer, Si De, told investors that the main reason for the drop was the comparison with last year. The third quarter of 2025 was the biggest in the company’s history, driven by Labubu plush bag charms going mainstream. No product line can keep growing at 245 percent a year. Measured against that extraordinary base, a fall was almost inevitable.

That is true — but it is not the whole story. The numbers also show that the fall is not just a statistical quirk. When revenue halves in a single quarter, something real has changed in what customers want.

The comparison was impossible to beat

The first reason is simple arithmetic. In the third quarter of 2025, Pop Mart’s revenue roughly tripled. This year it roughly halved. Put the two together, and the company is still selling far more than it did in the same quarter of 2024 — by some estimates 70 to 90 percent more, with mainland China revenue roughly double its 2024 level. What ended was a spike, not the whole business.

The fad moved on

The second reason is fad fatigue. Labubu was a viral moment, and viral moments have short lives. Collectors who bought dozens of dolls last year have full shelves now. New buyers who joined the craze late found the excitement had already peaked. Resale prices on second-hand markets have cooled, and when the resale market cools, the urge to keep buying fades with it.

This is the risk of building a business on a single character. When one toy drives your growth, one cooling trend can drag the whole company down with it.

Overseas demand was the thinnest

The third reason is geography. The sharpest falls were all outside China. Sales in the Americas collapsed by 70 to 75 percent, and Asia-Pacific outside China fell 65 to 70 percent. These were the markets where Labubu grew fastest in 2025, driven by social media hype and thin collector bases. When the hype faded, there was little underneath to hold sales up. In China, where Pop Mart has a dense network of physical shops and a deeper customer base, revenue fell by a much smaller 25 to 30 percent.

What it means for Pop Mart

For Pop Mart, the question now is whether Labubu was a one-hit wonder or the start of something lasting.

The company is not standing still. Management told investors it expects the fourth-quarter holiday season to bring an improvement on the third quarter, and it is trying to reduce inventory, protect profit margins and build demand for characters beyond Labubu. Other characters are growing: Twinkle Twinkle, known in Chinese as Xingxingren, has moved in the opposite direction to Labubu. And a Labubu film is still in script development.

But the warning signs are there in the company’s own numbers. Revenue from The Monsters — the character family that includes Labubu — was 4.454 billion yuan in the first half of 2026, down 7.5 percent from a year earlier. Its share of the group’s total revenue fell from 34.7 percent to 26 percent. In 2025, the same range had generated 14.161 billion yuan, up 365.7 percent. The engine of Pop Mart’s growth is slowing, and nothing has yet replaced it.

Analysts are split on what comes next. Jefferies cut its earnings forecasts for 2027 and 2028 by 9 to 12 percent after the results. JPMorgan is more cautious still, projecting that fourth-quarter revenue will fall 41 percent from a year earlier. Pop Mart itself declined to comment on the share price and did not answer questions about the falling sales.

Ashley Dudarenok, of the China research firm ChoZan, summed up the challenge in a line that has been widely quoted: “Disney sells a story before it sells a toy, while Pop Mart is working in reverse.” Disney’s characters come with films, theme parks and decades of stories. Labubu arrived as a toy first, and the story is still being built.

What the Labubu slump tells us about viral crazes

The Labubu story is bigger than one toy company. It is a case study in how fast viral consumer crazes can inflate — and deflate — a business.

Three lessons stand out.

First, a viral spike is not the same as lasting demand. Labubu’s growth in 2025 was real, but it was driven by novelty, social media and the fear of missing out. When the novelty wore off, the demand underneath was much smaller than the peak suggested.

Second, blind boxes are a double-edged sword. Sealed boxes with random figures encourage repeat buying and create excitement — but they also depend on collectors staying excited. Once the excitement fades, the same mechanic works in reverse: there is no reason to buy another box.

Third, one character is a fragile foundation. Pop Mart’s challenge now is the one every hit-maker faces: finding a second act. The company has hundreds of characters and a huge retail network, but it needs another Labubu — or a different kind of success altogether — to return to growth.

None of this means Labubu is finished. The dolls still sell, the brand is still worth billions, and the company is still far bigger than it was before the craze began. But the days when every new release sold out in minutes and the share price only went up are over. The monster that took over the world has met the one thing no viral craze can escape: the morning after.

Frequently asked questions

What is Labubu?

Labubu is a furry monster doll with pointed ears, wide eyes, sharp teeth and a mischievous grin. It was created by Hong Kong artist Kasing Lung as part of his The Monsters series and is sold by the Chinese toy company Pop Mart, mostly in sealed blind boxes where buyers do not know which figure they will get.

Why are Pop Mart’s sales falling?

Pop Mart reported that revenue in the third quarter of 2026 fell 45 to 50 percent compared with a year earlier. The main reasons are the comparison with an extraordinary third quarter in 2025, when revenue grew 245 to 250 percent, and cooling demand for Labubu as the viral craze fades — especially outside China.

How far have Pop Mart shares fallen?

The shares fell as much as 6 percent to HK$123.80 on 28 October 2026, an 18-month low. They have lost more than 30 percent of their value since the start of 2026 and sit more than 60 percent below their August 2025 peak of about HK$337.

Is Labubu finished?

Not necessarily. Pop Mart is still one of the world’s most valuable toymakers, worth close to 24 billion dollars, and its revenue is still far above 2024 levels. But the company needs new hit characters and a stronger story around Labubu to return to growth, and analysts expect sales to keep falling in the fourth quarter.

Where can you buy Labubu?

Labubu figures are sold through Pop Mart’s own shops — around 500 stores in more than 30 countries — as well as its vending machines and online channels. Rare versions also trade on second-hand and resale markets, where prices have cooled along with demand.

Conclusion

A year ago, Labubu looked unstoppable. Pop Mart’s sales were tripling, its shares were at record highs, and collectors were spending tens of thousands of dollars on furry little monsters. Today, sales have halved, the shares have lost more than 60 percent from their peak, and even the most devoted collectors are moving on to the next trend.

The fall does not erase what Pop Mart built. The company is bigger, richer and more global than it was before Labubu. But it is a reminder that viral fame is borrowed, not owned. The companies that last are the ones that turn a moment into a story people care about for years. That is Pop Mart’s real test — and it starts now.

Sources

• BBC News, “Labubu hype seemed unstoppable, now the fluffy monster mania is dying” (7 November 2026), via World Right Now: https://worldrightnowlive.com/story/labubu-hype-seemed-unstoppable-now-the-fluffy-monster-mania-is-dying
• Asia Daily, “Pop Mart Revenue Falls 45% to 50% as Overseas Slump Deepens”: https://asiadaily.org/news/16783/
• BigGo Finance, “Pop Mart Shares Hit 18-Month Low as Labubu Demand Cools, Q3 Revenue Drops Up to 50%”: https://finance.biggo.com/news/e593587a-1e86-4b21-b31a-648ad2bb2214
• Longbridge, “Pop Mart’s Q3 Revenue Slumps 45-50% As Demand Outside China Falls”: https://longbridge.com/en/news/303361857
• BXTData, “Pop Mart product sales halve as Labubu cools”: https://www.bxtdata.com/en/insights/3309/Pop%20Mart%20product%20sales%20halve%20as%20Labubu%20cools

This article is for general information and education only. It is not legal or financial advice.