Pop Mart 1Q26 revenue meets the high end of expectations, but sustainability and margins remain core concerns

Overview

This report is Bernstein's 1Q26 earnings review of Pop Mart International Limited (9992.HK). The company’s 1Q26 revenue growth overall met high market expectations: total growth of 75%-80%, China growth of 100%-105%, and overseas sub-region performance of 25%-30% in Asia Pacific, 55%-60% in the Americas, and 60%-65% in Europe and others. Despite strong growth, the report stresses this is not a material upside surprise but rather confirmation of a bullish scenario the market had already expected.

Core views

The core view is cautious. Bernstein argues that strong 1Q26 revenue growth does not directly indicate strong growth quality, defendable margins, or durable long-term demand. China online-channel growth significantly exceeded its original model assumptions and was the main source of forecast miss, but the company still faces higher year-on-year comparisons, rising investments, and uncertainty around international expansion profitability. Bernstein maintains an Underperform rating, saying the market may already have priced in faster China online-channel growth and that Q2-Q4 could see a slowdown in growth and demand fill-up pressure.

Analysis framework

The report breaks down 1Q26 revenue growth along two dimensions: region and channel. By region, it compares China, Asia Pacific, Americas, and Europe and others; by channel, it compares China offline and online channels. It then compares actual outcomes against investor expectations and Bernstein's original model assumptions, identifies sources of forecast divergence, and assesses FY26 sustainability using forward-quarter yoy base effects, incremental spending, and the overseas margin realization timeline.

Methodology notes

• Valuation methodsNTM P/E multiple valuation

  Forward 12-month P/E

  The report values Pop Mart using a target forward 12-month P/E multiple and selects the target multiple based on earnings growth and ROIC; the HKD 181 target price is based on a 12.3x NTM+1 P/E.

• Fundamental analysisRegional and channel growth decomposition

  Revenue growth attribution

  The report splits 1Q26 growth into China, Asia Pacific, Americas, and Europe and other markets, and further decomposes China offline and online channels to assess whether growth is driven by sustainable demand rather than a single channel or low base effects.

• Expectation variance analysisComparison of actual results with market expectations and model assumptions

  Degree of expectation delivery

  The report believes 1Q26 results reached the high end of market expectations but did not create a major positive surprise; Bernstein's own model under-estimated momentum in China online channels and in Europe and America.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• 9992.HK

  Research subject

  Strengths

  1Q26 revenue growth was strong, China online-channel growth accelerated sharply, and momentum in the Americas and Europe was better than some tracking data suggested; the company has high-engagement IPs such as Monster and has international expansion potential.

  Weaknesses

  Growth quality, margin sustainability, and the profitability timeline for overseas operations remain unclear; future quarter year-on-year comparisons are higher, and Q1 may have included one-off tailwinds.

  Comparison

  The report compares 9992.HK against ASIAX; under Bernstein's rating framework, Underperform means expected to underperform the relevant market index by more than 15 percentage points over the next 12 months.

  Risks

  If Monster popularity, international expansion, or margins continue to beat expectations, the Underperform view may face upside risk.

• ASIAX

  Rating benchmark

  Strengths

  Used as the benchmark index (Asia ex-Japan large-and-mid-cap index) to measure relative performance of 9992.HK.

  Weaknesses

  Not the company’s own asset, so it does not directly reflect Pop Mart’s operating fundamentals.

  Comparison

  9992.HK’s relative performance versus ASIAX over the past 12 months was -57.7%.

  Risks

  If market index volatility is high, there may be an apparent inconsistency between implied target upside and relative rating.

Key data

• 1Q26 total revenue year-on-year growth75%-80%At the top end of the investor expectation range of 70%-80%.
• 1Q26 China revenue year-on-year growth100%-105%Above Bernstein’s prior estimate of around 77%, mainly driven by accelerated online-channel growth.
• 1Q26 China online-channel year-on-year growth150%-155%Significantly above Bernstein’s prior estimate of around 91%; the report states Moojin data did not fully capture WeChat mini-program momentum.
• 1Q26 China offline-channel year-on-year growth75%-80%Lower than online but still high growth.
• 1Q26 Asia Pacific revenue year-on-year growth25%-30%Relatively lower growth among overseas regions.
• 1Q26 Americas revenue year-on-year growth55%-60%The report says overseas tracking data had under-estimated momentum in the Americas and Europe.
• 1Q26 Europe and others revenue year-on-year growth60%-65%Generally in line with overseas growth expectations.
• Implied Q2-Q4 total growthabout 17%Bernstein remains cautious on the sustainability of growth in FY26's later quarters.
• Target priceHKD 181.00Based on a 12.3x NTM+1 P/E.
• Last closeHKD 162.90As of 2026-05-12.

Impact & implications

For investors, the report implies that short-term high revenue growth has been largely fully priced by the market, and future equity drivers require stronger evidence that growth is sustainable, margins are maintained, and overseas businesses become profitable. If Q2-Q4 growth slows as Bernstein expects, the market could reassess the high-growth narrative; if Monster demand, new IP expansion, or margins continue to beat expectations, it could represent upside risk.

Risks

• Monster sales exceed expectations, with collector demand and new customer cohorts further lifting sales and penetration.
• New product lines and international-market revenue contributions arrive earlier or exceed expectations, accelerating overall growth.
• Operating and net margins remain above expectations, and the company maintains high-efficiency execution while preserving historically high profitability.
• Momentum in China online channels and WeChat mini-programs remains stronger than trends captured by third-party tracking data.
• Overseas business profitability is realized faster than the report’s assumption.

What to watch

• Whether revenue growth in Q2-Q4 clearly slows as in the report’s expectation or continues at 1Q26’s high pace.
• Whether China online-channel high growth is sustainable, especially true demand intensity in channels such as the WeChat mini-program.
• The impact on subsequent growth of China market maturity, new IP launches, and a high yoy base.
• Whether international expansion causes margin dilution and whether the overseas profitability timeline is accelerated.
• Whether operating and net margins can stay elevated after spending increases.
• Sales, customer base expansion, and repurchase patterns of Monster and other core IPs.