China’s Art Toy Brand Pop Mart Slows in Growth, while Overseas Revenue Surges

Consumer Staples Author: Yiru Qian Mar 30, 2023 11:53 AM (GMT+8)

Will Pop Mart remain its strong growth in the overseas market?


China's collectable art toy maker Pop Mart (0002:HK) reported a revenue of CNY 4.62 billion (USD 669.6 million) for the year ended December 31, 2022, up 2.8% year-on-year.

According to the financial report filed on March 29, Pop Mart posted a gross profit of CNY 2.65 billion in 2022, shrinking 3.8% compared with the last year.

The company also logged an adjusted net income of CNY 573.5 million - a significant drop of 42.7% from last year.

As of December 31, 2022, Pop Mart accumulated over 26 million registered members, who contributed 93.1% of the company's sales with a repurchase rate of 50.7%. However, this number slightly decreased compared with the previous year.

The intellectual property (IP) remained to be the company’s core competitiveness. According to its annual report of 2022, revenue from those propriety products contributed 90.8% of the total revenue. Its IP SKULLPANDA series hit a revenue of CNY 851.6 million in the reported period, representing a jump of 43.07% year-on-year, which also replaced MOLLY to become the top series.

In terms of channels, Pop Mart slowed the pace of offline store and robot store openings domestically in response to the uncertainty of the outbreak. It launched only 41 new bricks-and-mortar stores and 206 new roboshops in mainland China during the reported period. 

Notably, Pop Mart documented a robust growth in overseas markets. As of the end of 2022, it operated 43 stores, 120 roboshops and 13 cross-border e-commerce platform sites in Hong Kong SAR, Macau SAR, Taiwan and overseas, whose revenue ballooned 147.1% to CNY 453.9 million. In addition to the continuous expansion in the Asian market, Pop Mart also made its debut in the UK, New Zealand, the U.S. and Australia with local offline stores. Previously in March 3, 2023, Pop Mart has launched its first-ever store in Paris, marking the brand's first permanent store in continental Europe, sources said.

A bunch of art toy brands has received a fair share of attention for their roles in helping to fulfil people’s gambling psychology and emotional value. They include IP Station, 52Toys, ToyCity, Xinghui Creations, IPSTAR, Alpha Group (002292:SZ), to name but a few, and Pop Mart is one of the best examples and the face of the industry.

As of press time, Pop Mart’s stock price closed at HKD 21.55 with a market capitalization of HKD 29.47 billion.