Key facts
- China's industrial profits increased by 21.1% in May compared to the previous year.
- This growth rate eased from the 24.7% jump recorded in April.
- For the January-May period, industrial profits rose by 18.8% year-on-year.
- Profits in the computer, communication, and electronic equipment manufacturing sector saw a significant surge of 103.9% in the first five months.
- Conversely, profits for automakers declined by 19.8% during the same period.
- Analysts anticipate increased government support to stabilize corporate earnings.
China's industrial profits experienced a slowdown in May, rising 21.1% year-on-year, a decrease from April's 24.7% growth. This trend highlights an economy increasingly dependent on factory output and exports to compensate for sluggish domestic demand and a persistent property sector downturn.
Overall economic growth remains fragile, burdened by deep structural imbalances. While profits for manufacturers of computers, communication, and electronic equipment surged by 103.9% in the January-May period, driven by the global AI boom, profits for automakers fell by 19.8% despite robust export performance.
For the first five months of the year, industrial profits increased by 18.8% compared to the same period last year. Analysts anticipate that policymakers will introduce targeted support measures to stabilize corporate profitability, especially as sectors facing overcapacity and intense competition undergo consolidation.
The industrial profit figures encompass companies with annual revenues of at least 20 million yuan from their primary operations.