The performance pillar of Ming Yang Smart Energy Group Limited (ASX: MYE) is decelerating, with overseas investments yet to yield returns, leading to a significant decline in its financial results.
On the evening of July 14th, the company's preliminary half-year results sent ripples through the wind power industry. The company forecasts a net profit attributable to shareholders of 100 to 150 million yuan for the first half of 2026, representing a year-on-year decline of 75.41% to 83.60%. Its non-GAAP net profit is projected to be between 5 million yuan and a loss of 45 million yuan, plummeting by 98.97% to 109.27%.
This industry leader, which started in Zhongshan, Guangdong, and grew over two decades to become the world's second-largest in new offshore wind installations, is facing its most severe operational challenges in recent years.
Structural Issues Behind the Numbers
More noteworthy are the structural problems underlying the data. The 2025 annual report shows the company's international sales revenue was only 807 million yuan, accounting for a mere 2.12% of total revenue, while overseas investments have increased substantially. Concurrently, power station sales—the company's most stable profit source in recent years—have shrunk drastically due to slower project construction progress and sales pace. As this "profit engine" of power station transfers decelerates, and the overseas business remains in a "cash-burning, non-profitable" phase, the profitability of this former wind power star is under dual pressure.
Two Decades of Technological Breakthroughs
When Ming Yang was founded in Zhongshan in 2006, China's wind power industry was still in its infancy, heavily reliant on technology imported from Europe.
The company chose a more challenging path: eschewing simple licensed production in favor of starting with collaborative R&D to gradually gain autonomy. In 2014, it independently developed a 6.5MW offshore wind turbine, which was the world's largest single-unit capacity offshore model at the time. In 2018, the typhoon-resistant MySE5.5MW turbine was put into operation, debunking the industry consensus that "large-scale wind power development is impossible in typhoon zones." In 2024, the world's largest single-unit capacity 16.6MW floating wind platform, the "Ming Yang Tiancheng," commenced operation in the deep waters off Yangjiang, solidifying the company's position as the world's second-largest in new offshore wind installations.
While technological breakthroughs are evident, the issue is that these leading edges have not been fully translated into profit advantages.
Data from the 2025 annual report shows that revenue from wind turbine and related component sales was 31.01 billion yuan, constituting 81.4% of operating revenue, but with a gross margin of only 6.38%. In contrast, power station product sales boasted a gross margin of 28.99%, and wind farm power generation had an even higher gross margin of 45.99%. The power station sales business—developing and constructing new energy power stations before transferring them to third parties—is the true pillar of Ming Yang's profits. This segment contributed 4.506 billion yuan in revenue in 2025, a year-on-year increase of 61.41%.
This reveals an often-overlooked structural characteristic: Ming Yang Smart Energy is not purely a wind turbine manufacturer but a hybrid entity combining "manufacturing + power station development + transfer."
The timing of revenue recognition from power station transfers directly impacts the company's overall profits. This revenue grew from 2.792 billion yuan in 2024 to 4.506 billion yuan in 2025, a sharp 61% increase, serving as the key driver for the company's performance recovery in 2025.
When the pace of project transfers slowed in the first half of 2026, profits experienced severe volatility.
For a manufacturing company known for its technology, relying on asset transfers rather than the products themselves for profits inherently sows seeds of instability. Power station transfers are influenced by multiple factors including project construction cycles, grid connection, regulatory approvals, and buyer funding arrangements. A bottleneck in any link directly affects the income statement.
Overseas Investment and the Output Gap
Another layer of pressure on Ming Yang comes from its international operations.
In 2025, international sales revenue was only 807 million yuan, accounting for 2.12% of total revenue, but it achieved a high gross margin of 21.34%, significantly exceeding the 10.13% level for domestic sales.
The profit potential in overseas markets is clear; the problem lies in the entry barriers and upfront investments being far higher than market expectations.
The company continues to advance its global layout, with increased year-on-year investments in overseas market promotion, local team building, and international project research. However, the cycle from signing an overseas order to delivery and revenue recognition is much longer than in the domestic market.
For European projects, a timeline of three to five years from bidding, certification, financing to delivery is the norm. Costs are already recorded in the current period's expenses, while revenue recognition remains distant.
The Q1 2026 report shows Ming Yang's net profit attributable to shareholders was a mere 24.6585 million yuan, down 91.84% year-on-year. Its non-GAAP net profit was -115 million yuan, a decrease of 140.07%.
Based on this, Q2 net profit is estimated to be between 75 and 125 million yuan. The sequential quarterly improvement might suggest a recovery in operational rhythm, but the warning signal from the non-GAAP net profit cannot be ignored—the profitability of its core business has slipped close to the breakeven line.
Industry Divergence and the Benchmark
Placing Ming Yang's situation alongside its peers makes the divergence trend even clearer.
In 2024, Dajin Heavy Industry's overseas revenue reached 1.733 billion yuan, accounting for nearly 50% of its wind power equipment segment revenue. Its net profit attributable to shareholders grew 11.46% year-on-year, with gross margin rising for three consecutive years to 29.83%.
Dajin Heavy Industry follows an integrated "manufacturing + shipping + delivery" model, streamlining the delivery chain using Delivered at Place (DAP) terms. The continuous increase in European orders translates into tangible cash flow, not just "framework agreements" in press releases. In 2024, it delivered projects including the UK's Moray West, Sofia, DBB offshore towers, France's NOY monopiles, and Denmark's Thor monopiles, with cumulative shipments reaching 110,000 tons. Export gross margin was 38.5%, an 11 percentage point increase year-on-year.
Envision Energy represents another path.
It exercises restraint regarding low-price domestic orders, shifting resources towards high-value overseas markets. In 2025, its overseas installed capacity reached 4.8GW, a 15-fold year-on-year increase. The key distinction is that Envision's overseas orders represent actual delivered volumes that have been installed and can be recognized as revenue, not just "awarded capacity" on presentation slides.
The commonality between these two companies is that the pace of their overseas expansion matches their cash flow capacity, with predictable order conversion cycles, forming a verifiable delivery capability.
Ming Yang's problem is a significant temporal mismatch between overseas investment and output—the narrative advanced too quickly, factory layouts were established too early, and project realization is too slow.
Ming Yang already experienced a performance "trough" in 2023, with net profit attributable to shareholders dropping 89.19% year-on-year to 372 million yuan, and even reporting its first quarterly loss in Q1. It subsequently achieved a performance recovery in 2024 and 2025 by ramping up power station sales. However, as soon as the pace of power station sales slowed in the first half of 2026, profits came under immediate pressure.
Behind these cyclical fluctuations lies the company's persistent failure to establish a sufficiently stable foundation of manufacturing profits, instead relying excessively on the "one-off deal" nature of power station transfers as a profit source.
Key Focus Areas for the Market
Looking at Ming Yang Smart Energy from the vantage point of July 2026, several questions warrant ongoing observation.
The conversion rate and delivery pace of overseas orders. Of the overseas awarded capacity announced in 2025, how much will enter the manufacturing, shipment, and revenue recognition stages in 2026? The answer to this directly determines whether Ming Yang's overseas story is a strategic layout or a financial burden.
Its ability to defend domestic market share. Against the backdrop of ongoing price competition in onshore wind and increasing competitors in offshore wind, can Ming Yang maintain its advantage in its "home turf" of offshore wind?
During the industry's most difficult period in 2023, Ming Yang achieved a "soft landing" by leveraging its first-mover advantage in offshore wind and the flexible model of power station transfers.
However, the same strategy appears less effective in 2026—overseas investments are still increasing, but the domestic competitive landscape is different from three years ago. Companies like Goldwind, Envision Energy, Sany Renewable Energy, and Yunda are all strengthening their product lines, cost control, and overseas layouts. Ming Yang faces not just point pressure but a systemic upgrade in competition.
For investors, the value anchor for Ming Yang Smart Energy may need recalibration. It's no longer just about the "offshore wind leader" label; it's about clearly calculating the sustainability of power station transfer revenue, when the overseas business will cross the breakeven point, and whether the gross margin of its core manufacturing business can return to healthy levels.
Without clear, trend-driven improvements in these areas, volatility in Ming Yang's income statement is likely to persist.
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