Taking into account various factors, including market dynamics and operational performance, Damai Entertainment (formerly Alibaba Pictures) has reportedly decided to shut down Koitake, a wholly owned subsidiary. The company stated it would handle post-closure matters appropriately.
According to sources familiar with the situation, one key reason for the closure was underperformance. Koitake’s revenue contribution was characterized as minimal compared to the broader operations of Alibaba’s Hujing Digital Media and Entertainment Group.
As reported by 36Kr, the shutdown and associated layoffs proceeded swiftly. Most of the team was notified on the same day, with only a few staff members retained for transitional tasks. Their long-term status has yet to be determined.
Koitake and Alifish were the two main business lines derived from intellectual property under Damai. Koitake focused on designer toys based on the company’s IP portfolio, utilizing both proprietary and distribution channels. In contrast, Alifish functions as a transactional platform centered on IP operations, licensing, and commercialization.
In the years prior to its closure, Koitake invested heavily in original IP development and merchandise tied to popular media. Over the recent Dragon Boat Festival holiday, the brand even participated in the Toy Heart Expo, a well-known designer toy convention.
Its bestselling product was a blind box series based on Empresses in the Palace, a historical drama. When the line launched in 2022, it consistently ranked among the top ten in Tmall’s blind box sales.
Outside of media collaborations, Koitake developed more than ten original designer toy IPs, based on publicly available information. However, aside from the Empresses in the Palace collection, none achieved meaningful commercial traction.
In 2024, Koitake generated less than RMB 500 million (USD 70 million) in revenue. In comparison, Hujing recorded RMB 22.267 billion (USD 3.1 billion) in Alibaba’s fiscal year 2025 earnings report, with Koitake accounting for just 2% of total revenue.
The closure also reflects broader restructuring within Hujing.
On May 21, Alibaba rebranded its digital media and entertainment arm as Hujing, with Alibaba Pictures renamed Damai. In an internal memo, the company described the move as part of its broader “return-to-roots” strategy and framed it as a way to “start anew.”
This pivot reflects a gradual shift in focus from traditional film ventures toward higher-margin areas, such as live events and IP merchandise.
In fiscal 2025, Alibaba Pictures posted RMB 6.702 billion (USD 938.3 million) in revenue, up 33.1% year-on-year. Of this, Damai contributed RMB 2.057 billion (USD 288 million), a 236% increase, while IP merchandise brought in RMB 1.433 billion (USD 200.6 million), up 73% year-on-year. Together, these two segments accounted for more than half of the company’s total revenue and were key growth drivers.
The boom is no accident. Hujing’s strategy appears calibrated to two industry trends: a stagnant film sector and a burgeoning designer toy market led by players like Pop Mart.
In this context, shuttering Koitake may be viewed as a pragmatic move that reflects the company’s focus on streamlining operations. After all, while many entertainment firms want a piece of the designer toy pie, not every brand can be the next Pop Mart.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Lan Jie for 36Kr.