When you’re hot, you’re hot. And when you’re not, you’re not. That’s the painful lesson being learned these days by Pop Mart International Group Ltd. (9992.HK), whose trendy collectible toys are not quite as big as they used to be.
Pop Mart has increasingly disappointed investors these past two years as its growth slowed. Its latest quarterly update showed that trend is continuing, deepening fears that it may be on a longer-term downward trajectory off the hip and trendy list. Such is always the big danger for companies that live at the cutting edge of the latest trends, as they inevitably discover one day that someone else has become the hot new kid on the block.
Last Tuesday, Pop Mart announced a set of disappointing operating data for the quarter through September, with overall revenue declining between 5% and 10% from the same year-ago period – its first-ever decline since its 2020 IPO. It forecast sales in its top mainland China market fell by an even steeper 10% to 15%, according to its statement to the Hong Kong stock exchange.