China's April industrial profits grow at fastest pace in more than two years

BEIJING - China's industrial profits in April grew at the fastest pace since November 2023, despite financial pressures stemming from softening domestic demand and rising component costs exacerbated by the Middle East crisis.

The latest data adds to signs of an uneven recovery, with the economy largely losing momentum at the start of the second quarter. While exports have remained a rare bright spot, most other indicators have undershot expectations, leaving firms increasingly reliant on overseas markets for growth.

The shift comes as companies navigate persistent domestic headwinds and heightened global uncertainty, with U.S. President Donald Trump's visit to China earlier this month delivering only modest commercial and trade commitments and an agreement to build a "constructive" relationship.

Profits at China's industrial firms rose 24.7% last month from a year earlier, sharply up from a 15.8% jump in March, data from the National Bureau of Statistics showed on Wednesday.

For the January-April period, industrial profits climbed 18.2%, versus a 15.5% increase recorded in the first quarter.

Exports gained steam across many sectors last month, fuelled by a global AI investment surge and buyers accelerating purchases on concerns about further increases in input costs linked to the U.S.-Israeli war with Iran.

Still, solid export performance has not been enough to offset persistent weakness at home, a trend particularly evident in the auto sector.

China's top electric vehicle maker BYD's first-quarter profit fell 55.4%, its steepest drop since 2020 despite record overseas sales as a share of total vehicle sales.

Meanwhile, Leapmotor, often seen as an emerging domestic rival to BYD, posted its strongest first quarter in revenue terms, driven by rising sales and a notable surge in exports, but its net loss widened compared with the year before.

Industrial profit figures cover firms with annual revenue of at least 20 million yuan ($2.95 million) from their main operations.

($1 = 6.7851 Chinese yuan)

(Reporting by Qiaoyi Li and Ryan Woo; Editing by Clarence Fernandez and Jacqueline Wong)

Copyright Reuters or USA Today Network via Reuters Connect.

This story was originally published May 26, 2026 at 10:11 PM.