By Patrick Graham December 24, 2025
The “Labubu” phenomenon, which defined the global collectible market for much of early 2025, has hit a wall of economic reality. Once an unchallenged icon of Gen Z cool, the sharp-toothed forest elf from Pop Mart International Group Ltd. is now being cited as a cautionary tale of speculative mania. In a dramatic reversal of fortune, Pop Mart’s Hong Kong-listed stock has crashed approximately 40% from its August 26 peak, erasing nearly $24 billion in market value—roughly triple the entire valuation of Hello Kitty owner Sanrio.
The collapse, occurring just as the holiday shopping season reaches its peak, has sent shockwaves through the retail and investment communities. What began as a viral trend endorsed by global superstars like Blackpink’s Lisa has rapidly transformed into a case study in “fashion fatigue.”
The Anatomy of a Crash
The numbers painting the picture of Labubu’s decline are stark. After a meteoric rise that saw Pop Mart’s stock surge over 3,200% from its 2022 lows, the “Labubu Bubble” began to leak in late summer.
- Revenue Deceleration: According to data from YipitData, North American revenue growth slowed to 424% in the quarter ending December 6, 2025. While seemingly high, it is a significant drop from the 900%+ growth recorded in the previous quarter.
- Secondary Market Freefall: The secondary market, often the canary in the coal mine for collectibles, has frozen. Items like the “Big Into Energy” series, which once commanded $400 on resale platforms like StockX, are now trading as low as $110—well below their $168 retail price.
- Stock Sentiment: JPMorgan downgraded Pop Mart in September 2025, moving from “Overweight” to “Neutral.” Analysts warned that the company was “priced for perfection,” leaving no room for the cooling demand now being observed.
The “Availability Paradox”
The crash is partly a result of Pop Mart’s own success—and its aggressive response to it. To combat scalpers and satisfy insatiable demand, the company ramped up production from 10 million units per month earlier this year to a staggering 50 million units per month by December.
This move solved supply shortages but triggered what Deutsche Bank calls the “Availability Paradox.” By making Labubu ubiquitous, Pop Mart inadvertently stripped the character of its “cool” factor and scarcity value. “When you can find a Labubu on every shelf and every Amazon listing, the ‘hunt’ is over,” says one Hong Kong-based retail analyst. “For Gen Z, ubiquity is the death of desire.”
Comparing to the Beanie Baby Bust
The speed of the decline has reignited comparisons to the Beanie Baby bubble of the 1990s. Like the plush toys of the past, Labubu’s value was driven largely by speculative hoarding. As resale prices dip below retail, the “investor-collectors” who fueled the frenzy are panic-selling, further saturating the market and driving prices lower.
The disappointing performance of Labubu during the U.S. Black Friday sales was the final straw for many institutional investors. Despite high-profile appearances at the Macy’s Thanksgiving Day Parade and a promotional takeover of the Empire State Building, the “buy-on-sight” fervor of the summer failed to materialize for the holidays.
What’s Next for Pop Mart?
Despite the stock rout, Pop Mart’s leadership remains defiant. CEO Wang Ning, whose personal fortune shrank by an estimated $11 billion during the crash, is pivoting toward long-term brand building. The company is currently in talks with Sony Pictures for a Labubu feature film and is moving forward with a dedicated animated series.
However, the question remains: Can a character born from a viral moment transition into a legacy franchise like Disney’s Mickey Mouse or Sanrio’s Hello Kitty? Or is Labubu destined to be remembered as the 2025 version of a Pet Rock?
As the sun sets on 2025, collectors are already looking for the next “big thing,” with many turning their holiday budgets toward crypto-based digital assets and niche artisanal toys, leaving shelves full of fuzzy, sharp-toothed dolls that no longer feel quite so special.
Quick Take:
- Peak to Trough: 40% stock decline since late August 2025.
- Resale Reality: Prices for popular series have dropped up to 70% from their peak.
- Future Outlook: Pop Mart is betting on a Labubu movie and animation to save the brand.