Labubu maker Pop Mart says Q3 sales fell 45% to 50%, with the Americas down 70% to 75%

Pop Mart, the Chinese company behind the Labubu collectible dolls, told investors that its third-quarter revenue fell 45% to 50% from a year earlier. CNBC reported the figures from a company filing made Tuesday. Investing.com reported the stock falling about 6% on Wednesday.

The regional breakdown

Pop Mart gave ranges, not exact figures, so none of the numbers above is a precise result. The full quarterly report has not been covered here.

The number behind the number

According to CNBC, Jefferies had expected a revenue decline of about 30%, though the result was broadly in line with what Jefferies called buy-side expectations. In other words, the published consensus was far too optimistic, but the investors who were actually positioned had already assumed the worst. That helps explain why the stock, after falling more than 6% early, was down under 2% later in the session, and why CNBC noted it had closed lower in nine of the previous 12 sessions.

The overseas drop is the real story. The company built its global growth on Labubu demand outside China. The Americas decline of 70% to 75% is nearly three times the mainland China decline.

What the analysts changed

Jefferies cut its 2027 and 2028 earnings estimates by 9% to 12%, citing weaker overseas sales and pressure on profitability, CNBC reported. It expects fourth-quarter revenue to rise 3% from the third quarter but remain 34% below the year-earlier level. Pop Mart is still opening flagship stores in New York, Milan and Paris and promoting other characters, including SKULLPANDA, Hirono and Twinkle Twinkle.

Who this hits

Retailers and resellers that stocked fad collectibles are the most exposed: a product whose US sales fall by roughly 70% leaves unsold inventory and weaker store traffic. Owners of small toy, gift and mall shops that carried the line should check how much stock they hold at current wholesale prices before reordering for the holiday season. Based on Yahoo Finance data, the share price is about 51% below its February 10 peak.

Sources: CNBC; Investing.com; Jefferies estimates as reported by CNBC; price history via Yahoo Finance. This is market information, not investment advice.