Despite international gold prices recording their largest annual gain in 46 years during 2025, sparking a global rush for the precious metal, established jewelry firm Zhejiang Ming Jewelry Co.,Ltd. delivered a shocking financial performance. The company expects its full-year net profit attributable to shareholders to record a loss between 280 million yuan and 380 million yuan, representing a year-on-year decline of up to 2214%.
According to the earnings forecast, Zhejiang Ming anticipates a net loss of 280–380 million yuan for 2025, compared to a profit of 17.9775 million yuan in the same period last year. Its adjusted net loss is projected to be between 300 million yuan and 390 million yuan, widening from a loss of 178 million yuan a year earlier. Even based on the lower end of the projected loss range, the company’s net profit plummeted by 1657.50% to 2213.75% year-on-year. Notably, Zhejiang Ming reported a net loss of 107 million yuan in the first three quarters of 2025, indicating a sharp acceleration in losses during the fourth quarter alone, which reached 173 million yuan to 273 million yuan.
Amid strong industry-wide conditions, what caused Zhejiang Ming’s steep underperformance? A closer look at its financial statements reveals that the massive loss did not originate from its core jewelry business, but rather from an ambitious 10-billion-yuan cross-sector move into photovoltaic cell manufacturing two years ago. The solar business has not only been hit by an industry downturn but has also dragged down overall results due to fixed-asset depreciation and asset impairments, becoming the largest drain on profits.
In February 2023, Zhejiang Ming announced plans to invest approximately 10 billion yuan in building a “super factory” for solar cell production, officially entering the photovoltaic sector. At the time, the company hoped that a dual focus on jewelry and solar would open new growth avenues. Just two years later, however, the gamble has produced disastrous results.
Sunshine Energy, the subsidiary operating the photovoltaic business, has been consistently unprofitable since commencing production. Public data show it lost 274 million yuan in 2024. By 2025, the solar industry remained in a cyclical downturn, with fierce price competition and persistently low product prices. Rather than recovering, Zhejiang Ming’s solar cell operations faced even greater financial strain.
The 2025 earnings forecast indicates the company will record asset impairment provisions of roughly 170 million yuan related to its photovoltaic segment, reducing net profit by approximately the same amount. In addition, significant earlier capital expenditures led to a noticeable increase in fixed-asset depreciation compared to the prior year, further eroding earnings. The photovoltaic unit has become the most volatile element in Zhejiang Ming’s financial reports.
Changes in revenue structure highlight the rapid decline of this cross-sector venture. In 2024, photovoltaic operations contributed 622 million yuan, accounting for 15.82% of total revenue. By the first half of 2025, however, revenue from solar cell sales plummeted to just 90.01 million yuan, shrinking to 4.64% of total revenue. This sharp contraction within six months reflects not only industry-wide demand fluctuations but also the company’s significant gaps in technology, customer base, and cost control compared to leading competitors.
More worryingly, there are no clear signs that the photovoltaic segment’s losses will abate. The company stated it will “actively respond to market changes in the solar industry, strictly control risks, and accelerate the development of premium customers and product technology upgrades.” Yet, amid industry overcapacity and ongoing price wars, a newcomer like Zhejiang Ming faces steep challenges. If the solar sector fails to recover substantially by 2026, further asset impairments may be required, prolonging the drag on earnings.
Rather than creating a second growth engine, the 10-billion-yuan diversification has turned into a liability that undermines the company’s already fragile profit base.
While Zhejiang Ming’s jewelry operations still dominate in scale, they failed to benefit from record-high gold prices in 2025 and instead came under unprecedented pressure. Soaring gold prices significantly dampened consumer demand, particularly for gold jewelry among price-sensitive shoppers. According to the China Gold Association, gold jewelry consumption fell 32.50% year-on-year in the first three quarters of 2025, while demand for gold bars and coins rose 24.55%. This shift underscores gold’s heightened appeal as an investment rather than a consumer good, directly hurting companies that rely on higher-margin jewelry sales.
Moreover, new gold tax regulations implemented in November 2025 further squeezed jewelry firms’ profit margins. The rules added 70 to 80 yuan per gram to gold costs based on prevailing prices. Companies like Zhejiang Ming, which focus on gold ornaments and lack large-scale hedging capabilities, struggled to pass these cost increases fully to consumers, leading to lower gross margins. This factor contributed significantly to the accelerated losses in the fourth quarter.
Notably, Zhejiang Ming’s operational challenges did not begin in 2025. Looking back, the company’s adjusted net profit has been in the red or barely profitable for six consecutive years since 2019, indicating systemic weaknesses in brand value, product mix, and distribution efficiency compared to peers.
In stark contrast, several other gold jewelry companies posted strong growth in 2025. Darry Ring projected a 140.98% to 176.30% rise in net profit, while CHJ Company anticipated growth of 125% to 175%. Caibai Group forecast a 47.43% to 71.07% increase. Even Cui Hua Jewelry, which performed modestly within the sector, saw adjusted net profit grow 154.81% to 280.64%. Against this backdrop, Zhejiang Ming’s underperformance stands out.
As noted by Wang LiXin, CEO of the World Gold Council in China, the country’s gold jewelry industry has shifted entirely from “scale competition” to “value competition.” Companies must innovate products, upgrade brands, and refine operations to adapt to changing demand patterns amid high gold prices.
However, Zhejiang Ming’s weaknesses in product competitiveness have been magnified amid rising gold prices. With uninspired designs and craftsmanship that fails to meet consumer expectations for both value retention and aesthetics, the company’s already weak market appeal has further eroded. As gold prices climb, shoppers become more selective about style and value for money. Zhejiang Ming’s generic, undifferentiated inventory fails to attract premium purchases or retain craftsmanship value in trade-in or recycling scenarios, leading to slower sales. Ultimately, the jewelry business has struggled even in what should have been a favorable gold market.
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