China Industrial Profits Rise for First Time in 5 Years
By Reuters | 26 Jan, 2026

Industrial profits rose 0.6% in 2025 after Beijing mounted a campaign against price wars and excessive competition that had been decimating corporate earnings.

 Industrial profit in China rose last year for the first time since 2021, government data showed on Tuesday, as a campaign against price wars and other excessive competitive practices relieved the pressure on corporate earnings.

Weak growth in the $19 trillion economy prompted official rebukes for sectors such as autos and solar panels where profit margins were squeezed in the pursuit of market share. The intervention has yet to halt a years-long decline in producer prices but an export boom has helped offset weak consumption.

Profit at industrial firms rose 0.6% for the whole of 2025 versus a year earlier, the first gain in four years. That growth compared with a 0.1% increase in the 11 months through November, showed data from the National Bureau of Statistics (NBS).

For December alone, profit rose 5.3% from the same month a year earlier. That reversed a 13.1% on-year fall in November.

Export diversification away from the U.S. cushioned the economy from the impact of U.S. President Donald Trump's tariffs on Chinese imports.

Strong exports helped the auto industry end 2025 with a 0.6% rise in profit, reversing an 8% fall a year earlier.

"The impact of changes in the external environment is gradually deepening," said NBS statistician Yu Weining.

"There are pains in industrial transformation and upgrading, and some enterprises are still facing certain difficulties in production and operation," Yu said.

Policymakers aim to boost consumption in the services sector under a broader push to encourage the purchase of the eventual fruits of industrial output, thereby addressing industrial over-capacity and reducing reliance on overseas demand.

State-owned industrial firms saw profit fall 3.9% last year whereas privately run firms' profit was flat while foreign firms recorded a 4.2% gain, the data showed.

Industrial profit figures cover firms with annual revenue of at least 20 million yuan ($2.88 million) from main operations.

($1 = 6.9542 Chinese yuan renminbi)

(Reporting by Qiaoyi Li and Ryan Woo; Editing by Louise Heavens, Jacqueline Wong and Christopher Cushing)