China Industrial Profits Jump 15.2% in Jan-Feb

China’s industrial profits jumped 15.2% yoy in the first two months of 2026, rebounding sharply from 0.6% growth in 2025. It marked the strongest start since 2018, excluding the pandemic spike in 2021, underscoring China's recovery momentum before Middle East conflict-driven oil shocks lifted raw material costs. State-owned enterprises returned to growth, with profits rising 5.3% to CNY 366.6 billion after a 3.9% drop in 2025. Private firms surged 37.2% to CNY 284.4 billion, rebounding from flat results last year. Joint-stock enterprises climbed 22.1% to CNY 803.3 billion, reversing a slight decline. By sector, manufacturing led gains with an 18.9% jump to CNY 732.1 billion, while mining profits rose 9.9% to CNY 155.6 billion. Utilities added 3.7% to CNY 136.8 billion. Among industries, computer, communication, and electronic equipment manufacturing led with 200% profit growth, while non-ferrous metal smelting and rolling soared 150%.

Profits at China’s industrial firms rose 0.6% to CNY 7.40 trillion in 2025, marking the first annual increase since 2021. Foreign-invested enterprises, including those funded by Hong Kong, Macao, and Taiwan, recorded profits of CNY 1.74 trillion, up 4.2% year on year. Private enterprises posted profits of CNY 2.28 trillion, unchanged from the previous year. In contrast, state-owned holding enterprises saw profits fall 3.9% to CNY 2.06 trillion, while joint-stock enterprises reported a slight decline of 0.1%, with total profits reaching CNY 5.54 trillion. By sector, manufacturing profits rose 5.0% to CNY 5.69 trillion, while the electricity, heat, gas, and water production and supply sector saw profits increase 9.4% to CNY 872.12 billion. Meanwhile, profits in the mining industry fell sharply by 26.2% to CNY 834.51 billion.

Profits at China’s industrial firms edged up 0.1% yoy to CNY 6.63 trillion in January–November 2025, notably easing from a 1.9% increase in the first ten months but still marking a fourth consecutive gain since August. The sharp slowdown underscored weakening year-end demand and persistent cost pressures. State-owned enterprises saw profits slip (-1.6% vs flat previously), while private firms inched lower (-0.1% vs 0.9%). Foreign-invested firms, including those backed by Hong Kong, Macao, and Taiwan, also lost momentum (2.4% vs 3.5%). By sector, computers and communications (15.0%), utilities (11.8%), non-ferrous smelting (11.1%), autos (7.5%), agriculture (4.8%), general manufacturing (4.8%), special equipment (4.6%), and electrical machinery (4.2%) led gains. Losses were steep in coal mining (-47.3%), oil and gas (-13.6%), textiles (-8.2%), and chemicals (-6.9%), though fuel processing narrowed declines. In November alone, profits fell 13.1% yoy, deepening from October’s 5.5% drop.