On the afternoon of March 25, the share price of POP MART experienced a significant decline, plummeting by over 23% during the trading session.

At the 2025 annual results presentation, the company's founder, chairman, and CEO Wang Ning set a target for 2026 to "strive for a growth rate of no less than 20%." He emphasized that the company is "not pursuing aggressive, profitless growth this year, but rather long-term, steady growth." This relatively conservative growth target, set against the backdrop of exceptionally high base figures from 2025—where revenue surged 184.7% year-on-year and net profit jumped 308.8%—triggered a sharp negative market reaction, causing the company's stock to nosedive.

Why did the market react negatively? The negative market reaction likely stems from three main factors. First, there is an expectation gap. Following years of sustained high-speed growth, the 20% guidance is significantly lower than the 2025 growth level, sparking market concerns about a "growth ceiling" and weakening growth momentum. Second, there is a valuation reassessment. During periods of high growth, the market often awards high valuation premiums. When growth expectations are downgraded, valuation models require recalibration, leading to downward pressure on the share price. Third, there are concerns regarding the lifecycle of IPs and the sustainability of hit products. Despite the strong performance of IPs like LABUBU, the market remains skeptical about whether the popularity of a single blockbuster IP can be sustained and whether the company can consistently create new hits. Sammy Xu, a consumer industry analyst at Deutsche Bank, pointed out that Labubu accounts for over half of overseas sales, exceeding 70% in some Western markets. He noted, "Without Labubu, other IPs would find it difficult to gain such rapid recognition and sales volume in overseas markets."

Strategic Layout and Supporting Factors Despite the conservative growth guidance, the company is still making strategic moves for long-term development. In terms of IP operations, LABUBU is scheduled to appear at the World Cup in June 2026, with plans to launch content products such as picture books and movies, aiming to evolve the IP from a潮玩 (trendy toy) focus towards a broader pan-entertainment ecosystem. Regarding channel operations, due to its rapid growth (quickly scaling from tens of millions to exceeding one hundred million), the Xiaohongshu (Little Red Book) channel will be operated independently within the content e-commerce division. This demonstrates the company's emphasis on emerging channels and its improving operational capabilities.

The management's emphasis on the goal of "long-term, steady growth" suggests a future focus that may prioritize profitability and cash flow over merely pursuing revenue expansion.