China’s industrial profits rose +0.6% YoY to ¥7.40tn in 2025, indicating marginal annual growth with sharp sector divergence.

• Total profit of industrial enterprises above designated size reached ¥7,398.20bn (+0.6% YoY), showing near-flat overall profit expansion across the year.

• State-owned enterprises recorded profits of ¥2,056.10bn (-3.9% YoY), while joint-stock firms slipped -0.1% YoY to ¥5,540.83bn, pointing to continued weakness among domestically controlled firms.

• Foreign, Hong Kong, Macao, and Taiwan-invested enterprises posted ¥1,744.74bn (+4.2% YoY) in profits, contrasting with flat private enterprise profits of ¥2,281.06bn (0.0% YoY).

• By sector, mining profits fell sharply to ¥834.51bn (-26.2% YoY), while manufacturing profits rose +5.0% YoY to ¥5,691.57bn and utilities increased +9.4% YoY to ¥872.12bn, highlighting downstream strength versus upstream contraction.

• Within manufacturing, ferrous metal smelting surged +3.0x YoY, non-ferrous metals rose +22.6% YoY, and electronics manufacturing increased +19.5% YoY, while chemicals (-7.3% YoY), textiles (-12.0% YoY), and coal mining (-41.8% YoY) declined.

• Operating income grew +1.1% YoY to ¥139.20tn, but operating costs rose faster at +1.3% YoY, pushing the profit margin down -0.03 pp YoY to 5.31%.

• Balance sheet metrics showed total assets up +4.3% YoY to ¥188.41tn, liabilities up +4.2% YoY, and the asset-liability ratio edging down -0.1 pp to 57.6%, indicating modest leverage improvement.

• Accounts receivable increased +4.7% YoY to ¥27.43tn and finished goods inventories rose +3.9% YoY to ¥6.73tn, alongside longer collection periods of 67.9 days (+3.6 days YoY), pointing to slower cash turnover despite stable sales growth.