Industrial profits in China: +15.7%, but clothing and furniture fall
TUESDAY, 29 SEPTEMBER 2026
In the first eight months electronics more than doubles its profits, cars lose 16%. In August growth drops to 4.2%, the lowest of the year.
Industrial profits in China grew 15.7% in the first eight months of 2026, to 5.27 trillion yuan, but the growth is driven mainly by electronics: clothing, furniture and textiles, the sectors many European importers of consumer goods buy from, saw profits fall. In August the overall increase stopped at 4.2%, the lowest of the year, according to China's National Bureau of Statistics.
The National Bureau of Statistics figures
The data covers Chinese industrial firms above the size threshold set by the Bureau, and is measured in yuan. August marks the fourth consecutive month of slowdown, after April's +24.7%. The Bureau partly attributes the slowdown to a tough comparison: in August 2025 profits had risen 20.4%.
- January-August 2026: profits at 5.27 trillion yuan, +15.7% on the previous year; January-July stood at +17.6%.
- August 2026: +4.2% on August 2025, the lowest growth of the year, against +20.4% in August 2025.
- Computers, communications and electronics: profits more than doubled in the first eight months, +110%.
- High-tech manufacturing: +54.7%; manufacturing as a whole: +17.4%.
- Automobiles: profits down 16% in the first eight months.
Where industrial profits in China grow and where they fall
The push comes from electronics and high-tech manufacturing, linked to global demand for artificial intelligence components. It is concentrated growth: a sector doubling its profits while manufacturing as a whole rises 17.4% moves the average a great deal.
On the other side are the consumption-related sectors. Clothing, furniture and textiles recorded falling profits, against a background of weak domestic demand and rising energy costs. The sources do not give the exact figure for each of these sectors: the sign is negative, the size is not published in the reports consulted.
Profits, not prices and not volumes
A fall in profits measures the difference between revenue and costs, not how much factories produce or how much they charge. It may come from lower selling prices, from higher energy and raw material costs, or both, and the aggregate figure does not say in what proportion for each sector. It should therefore not be read as a direct indication of the price lists that will reach European buyers.
What it means for importers
The data does not show that Chinese clothing, furniture and textile suppliers are in trouble one by one, but it signals a context of tight margins in which it is worth looking more closely at a few things. The first is the supplier's resilience: in a sector with falling profits the risk grows that a company slows down, changes subcontractors or closes lines, so it pays to limit deposits and tie them to verifiable production stages.
The second is quality. When margins thin, the temptation to save on materials and finishes grows: a pre-shipment inspection and a signed reference sample become more useful than before. The third is price: a supplier under pressure may be willing to negotiate on volumes, but may also ask to revise price lists to cover energy. Either way it is better to have the terms in writing, with explicit validity.
A two-speed economy
The picture that emerges is of a divided Chinese industry: on one side electronics and high tech, driven by global demand linked to artificial intelligence; on the other the consumer goods sectors, which depend more on the domestic market. For those buying household items, textiles or promotional articles in China, it is the second half of the picture that matters.
With La Merce, those buying textiles, furniture or clothing in China while profits in those sectors fall pay deposits against verified stages and have goods inspected before shipment, because with tight margins the risk shifts to quality.
Sources
Independent checks on the figures cited, verified in-house.
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