China's major industrial firms post double-digit rise in profits

Profits at China's major industrial firms recorded solid growth through July, buoyed by rapid gains in electronics-related industries and high-tech manufacturing, official data showed on Thursday.

From January to July, industrial enterprises with annual main business revenue of at least 20 million yuan ($2.93 million) saw their total profits rise 17.6 percent year-on-year to 4.58 trillion yuan, data from the National Bureau of Statistics showed. In July alone, profits at major industrial firms rose 11.2 percent from a year earlier.

The double-digit growth in industrial profits, according to Yu Weining, a statistician with the bureau, was largely driven by robust earnings in electronics-related industries and high-tech manufacturing.

"Artificial intelligence is being integrated more deeply across sectors, driving sustained growth in demand for computing power," Yu said, adding that stronger demand and rising prices for related products had translated into rapid profit growth across AI-related electronics industries.

During the first seven months, profits in the electronics sector surged 110 percent from a year earlier, contributing 9.3 percentage points to overall profit growth among major industrial firms, NBS data showed. Profits at integrated circuit manufacturers, including makers of computing and memory chips, soared 1,850 percent year-on-year.

Meanwhile, profits in high-tech manufacturing rose 50.1 percent year-on-year in the first seven months, adding 9.6 percentage points to overall industrial profit growth. In particular, profits in optical fiber manufacturing surged 468.4 percent, NBS data showed.

Despite the strong profit growth, Yu cautioned that the industrial economy still faced a complex external environment and a persistent mismatch between strong supply and weak demand at home.

Looking ahead, Yu called for greater efforts to expand domestic demand and improve supply, accelerate the upgrading of traditional industries, support the growth of emerging sectors and nurture future industries, ensuring a smooth transition between old and new growth drivers.