Wanxiang Qianchao Co.,Ltd. (SZ: 000559) disclosed its 2025 annual report on the evening of April 6. The company achieved annual revenue of approximately 13.391 billion yuan, a year-on-year increase of 4.06%. Net profit attributable to shareholders reached about 1.036 billion yuan, up 8.89% compared to the previous year. However, adjusted net profit declined by 1.72% to approximately 917 million yuan. Basic earnings per share stood at 0.31 yuan. The company proposed a dividend of 2 yuan per 10 shares (tax inclusive), with no bonus shares or capital reserve conversions.
On the same evening, Wanxiang Qianchao announced plans to inject 120 million yuan of its own funds into its wholly-owned subsidiary, Wanxiang Qianchao (Americas) Co., Ltd. This capital will subsequently be used by the Americas subsidiary to invest in Wanxiang Qianchao (Thailand) Co., Ltd. The funds are designated for new production lines, supporting infrastructure, and the construction of a second-phase factory building and smart warehouse in Thailand.
This revenue growth marks a recovery for Wanxiang Qianchao, following a 7.84% decline in 2024 (calculated using restated figures). While net profit has increased for the fifth consecutive year, the growth rate of 8.89% in 2025 is notably slower than the 15.76% increase recorded in 2024.
A positive highlight was the net cash flow from operating activities, which surged 21.41% year-on-year to 1.594 billion yuan, significantly outpacing the net profit growth rate.
In the fourth quarter of 2025, the company reported revenue of 2.985 billion yuan, representing a 14.31% decrease compared to the same period last year and a 14.59% decline from the previous quarter. However, net profit for the quarter was 262 million yuan, up 11.87% year-on-year and 9.96% quarter-on-quarter.
During the reporting period, Wanxiang Qianchao continued to expand its portfolio of high-end clients. While securing bulk supply contracts and maintaining market share with existing customers, the company actively targeted the premium market. Key developments included projects for wheel hub units and drive shafts for Nissan, Toyota, and Volkswagen; a brake caliper project for SAIC; bearing and structural component projects for BYD; and a wheel hub unit project for Volvo.
Aligned with its "Dynamic, Intelligent Control" strategy, the company focused on its two core businesses: precision bearings and intelligent chassis, vigorously promoting green and intelligent development initiatives. It secured 317 domestic patents, including 183 invention patents. Several new products received provincial honors, such as the "Zero Drag" electronic brake corner module, which was recognized as a provincial first-of-its-kind product.
The annual report indicates that Wanxiang Qianchao's core products, including wheel hub units and constant velocity drive shafts, hold domestic market shares of 26% and 17%, respectively, while its universal joints lead globally in scale. The company has deeply integrated AI applications, deploying 19 AI agents that have generated annualized benefits exceeding 119 million yuan through digital and intelligent engineering. R&D investment continued to grow, reaching 559 million yuan in 2025.
Despite these achievements, the report also highlighted certain risks. Inventory of wheel hub bearing units increased by 167.43% year-on-year. The company attributed this primarily to production stockpiling for orders from clients like BYD, Great Wall Motors, and FAW-Volkswagen, whose subsequent uptake was delayed. Bearing inventory also rose by 69.48%, mainly due to the advance stocking of key materials and finished goods ahead of a factory relocation.
Amid the broader trend of automotive supply chains expanding overseas, Wanxiang Qianchao's international revenue decreased by 8.33% to 1.481 billion yuan. Furthermore, the gross profit margin for its core machinery manufacturing business slightly declined by 0.76 percentage points to 19.75%.
The report also disclosed that, concerning certain chromium iron trading activities of its subsidiary "Supply Chain Company" during 2022-2023, the company had not substantially participated in logistics, the procurement and sales contracts contained corresponding terms, and the transaction counterparties were related parties. Adhering to the principle of prudence, the company recognized revenue for these trades using the net method. This led to a significant prior period error correction, resulting in adjustments that decreased consolidated revenue and operating costs for 2022-2023 by 759 million yuan and 524 million yuan, respectively.
Looking ahead to 2026, Wanxiang Qianchao explicitly stated in its report that, while consolidating its share with existing "9N" customers, it will prioritize breaking into the global supply systems of Tesla Motors and Toyota. The company will also accelerate the development of cutting-edge products such as bearings for low-altitude aircraft and precision components for robotics (like ball screws and joint modules). Concurrently, the second-phase factory of its Thailand subsidiary is scheduled for completion and commissioning in 2026, alongside plans to select a site for a new factory.
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