The LEGO Group bucked the toy industry trend last year.

In a year in which global toy sales dropped 3%, consumer spending on LEGO products grew by 5.6% while revenue jumped 6%. In the company’s annual report, the LEGO Group says that operating and net profit increased by 1% and 3%, respectively, as the family-owned Danish brickmaker increased its investment in e-commerce, physical retail, and international expansion, particularly in China. The company reports single-digit sales gross in the Americas and Western Europe, with sales in China growing in the “strong double-digits.”

“Our industry, like many others, is being redrawn by digitalization and global socio-economic shifts,” says Niels B. Christiansen, LEGO Group’s CEO. “We’re leveraging our strong financial foundation to invest in initiatives that will allow us to keep ahead of these trends and enable growth in the long term. This includes innovating play, innovating our retail ecosystem, and investing in new market entries so that we are well-positioned to inspire young builders for generations to come.”

Christiansen says that the company’s core products, such as LEGO Classic, LEGO City, LEGO Technic, and LEGO Creator, are strong sales drivers and that the augmented reality (AR)-enhanced LEGO Hidden Side performed well in its first year. Licensed themes, including LEGO Star Wars and LEGO Harry Potter, continue to be top sellers alongside sets based on Marvel’s Avengers and Disney Princess.

Related: State of the Industry Q&A – The LEGO Group

The LEGO Group’s flagship location in Beijing, China.

The company, which now operates 570 LEGO Stores globally, added 150 stores last year and intends to open approximately 150 more this year — mostly in China. Amid continued crackdown on sales of counterfeit LEGO products, LEGO continues to grow in China with plans to open 80 new stores in roughly 20 new cities. By the end of last year, the company operated 140 stores in 35 cities, including its flagship locations in Beijing and Shanghai. Mirroring the 27% growth of its e-commerce site, the company crew digital sales in the Chinese market by forging partnerships in the territory, including one with Tencent to “engage consumers and shoppers through unique digital experiences.”

“The retail environment is constantly changing,” Christiansen says. “Consumers are looking for immersive brand experiences instore, and value and convenience online. We are stepping up investment in all our retail channels and working closely with our partners to connect with people wherever and however they want to shop.”

The LEGO Group recently debuted a robust line of new products at Toy Fair New York, including new licensed collections based on Illumination’s Minions and DreamWorks’ Trolls World Tour. Collector and advanced builder sets based on Lamborghini and The Fast Saga will debut later this year. Looking ahead, the company plans to increase its investment in sustainability and will open an office in another growing market, India, later this year.

About the author

James Zahn

James Zahn

James Zahn, AKA The Rock Father, is Editor-in-Chief of The Toy Book, a Senior Editor at The Toy Insider and The Pop Insider, and Editor of The Toy Report, The Toy Book‘s weekly industry newsletter. As a pop culture and toy industry expert, Zahn has appeared as a panelist and guest at events including Comic-Con International: San Diego (SDCC) Wizard World Chicago, and the ASTRA Marketplace & Academy. Zahn has more than 30 years of experience in the entertainment, retail, and publishing industries, and is frequently called upon to offer expert commentary for publications such as Forbes, Marketwatch, the Wall Street Journal, the New York Times, USA Today, Reuters, the Washington Post, and more. James has appeared on History Channel’s Modern Marvels, was interviewed by Larry King and Anderson Cooper, and has been seen on Yahoo! Finance, CNN, CNBC, FOX Business, NBC, ABC, CBS, WGN, The CW, and more. Zahn joined the Adventure Media & Events family in 2016, initially serving as a member of the Parent Advisory Board after penning articles for the Netflix Stream Team, Fandango Family, PBS KIDS, Sprout Parents (now Universal Kids), PopSugar, and Chicago Parent. He eventually joined the company full time as a Senior Editor and moved up the ranks to Deputy Editor and Editor-in-Chief.