China's industrial sector continues to show signs of stabilization as profit declines narrowed for the second consecutive month, according to data released by the National Bureau of Statistics (NBS) on Wednesday. Industrial profits fell 1.5% year-on-year in July, marking a 2.8 percentage-point improvement from June's figures. The January-July period saw total profits of large industrial enterprises drop 1.7%, with the contraction easing slightly compared to the first half of 2024.
High-Tech Manufacturing Leads Recovery
A standout performer was the high-tech manufacturing sector, where profits surged 18.9% in July—a dramatic rebound from June's 0.9% decline. This growth aligns with China's strategic focus on innovation-driven industries, particularly in semiconductors. Integrated circuit manufacturing profits skyrocketed 176.1%, reflecting strengthened domestic capabilities in critical technologies.
Policy-Driven Growth
Government initiatives to boost equipment upgrades and consumer goods trade-ins have begun yielding results. Electronics and electrical machinery equipment manufacturing profits jumped 87.9%, while computer manufacturing saw a 124.2% increase. NBS statistician Yu Weining noted that stabilized industrial output and price-level adjustments under recent policies have supported corporate earnings.
Total industrial revenue for January-July reached 78.07 trillion yuan ($10.9 trillion), up 2.3% year-on-year, with profits totaling 4.02 trillion yuan. Analysts suggest these trends signal cautious optimism for Asia's largest economy amid global headwinds.
