During its first-quarter 2026 business update call, POP MART reported that its overall revenue for the period grew by 75% to 80% year-on-year, exceeding market expectations.
Regionally, the company's business revenue in the Chinese market more than doubled (100%-105% growth) in the first quarter, with online channel revenue growing by over 150%. Overseas markets also showed broad growth. European business scale increased by 60%-65% year-on-year, the U.S. market grew by 55%-60%, and the Asia-Pacific market expanded by 25%-30%.
The company's Chief Operating Officer stated that while last year's high growth benefited from favorable market conditions, this year's performance will rely on team effort. Starting from Q1, POP MART has been adjusting its overseas store expansion strategy, focusing on optimizing store operations, building better fan systems, improving training, and establishing more mature teams. The company aims to address issues exposed during rapid growth, improve team structure, and leverage the confidence gained from last year's breakout period regarding overseas market potential. The focus is on solid operations to convert traffic into customer retention for stable, high-quality growth. With improved management system coordination and enhanced execution capabilities, the company is confident in delivering a better brand experience to global consumers.
When asked about the impact of rising raw material and oil prices on gross margin, the Chief Financial Officer responded that due to the international environment, prices for materials like PVC, fabric, and packaging have increased, raising costs for newly launched products. Based on current procurement and production estimates, raw material costs are expected to rise by 3 to 5 percentage points compared to the same period last year, potentially reducing the company's overall gross margin by about 0.5 percentage points. Additionally, recent volatility in international oil prices and the shipping market, particularly rising fuel costs for international shipping, have increased expenses for freight, fuel surcharges, and warehousing, which will also affect the gross margin of overseas business.
Regarding new ventures such as home appliances, the COO explained that alongside globalization, the company's development strategy includes diversification into film-related content and theme parks to enhance IP depth and emotional connections. The company also aims to leverage IP value by developing suitable categories, having previously launched products like desserts, home appliances, and accessories, with more potentially to come.
The COO emphasized a measured approach to new categories, stating that home appliances, like other recent categories, are still in a very early stage. The focus is on understanding the category, developing better products, and refining the supply chain without rushing development. There are no plans to move into traditional home appliances; instead, the goal is to integrate small appliances with lifestyle, IP, and trendy toy culture. In terms of pure sales, the current refrigerator product line is expected to generate revenue of only about 6 million yuan upon sell-out, which is a very small proportion of overall revenue. The company advises against over-focusing on this product and intends to patiently refine the category over time, aiming for it to become a significant, standard offering.
Comments