The once-leading film and television giant is now facing severe challenges. Recent legal records show that Huayi Brothers Media Corporation (300027.SZ) and its legal representative, Wang Zhongjun (also known as Wang Zhongjun), have been issued a new consumption restriction order due to an advertising contract dispute. The applicant is Beijing Tairui Feike Technology Co., Ltd., and the enforcement court is the Chaoyang District People's Court in Beijing.
On the evening of December 10, Huayi Brothers announced that due to economic conditions and delayed repayments, the company is experiencing temporary liquidity issues, leading to overdue debts totaling 52.5 million yuan—exceeding 10% of its audited net assets in 2024. Additionally, some of the company's bank accounts have been frozen.
Huayi Brothers stated it is actively negotiating with financial institutions to extend loans and resolve disputes. The company plans to optimize its asset structure by divesting non-core businesses and reallocating resources to focus on its main operations. Meanwhile, film and television projects continue as scheduled.
A separate disclosure revealed that Wang Zhongjun’s 154 million shares (48.54% of his holdings, 5.55% of the company’s total equity) will undergo a second auction after the first attempt failed on December 8–9. The new auction is scheduled for December 29–30. Earlier in October, 2.26 million of Wang Zhongjun’s shares and 157,000 of Wang Zhonglei’s shares were successfully auctioned via JD’s judicial sales platform.
Notably, Alibaba’s investment arm and Jack Ma, collectively holding 6.07% of Huayi Brothers’ shares, are considered acting in concert, raising concerns over potential control instability. Currently, all shares held by Wang Zhongjun and Wang Zhonglei are frozen, accounting for 13.81% of the company’s total equity.
Founded in 2004 and listed in 2009, Huayi Brothers was once hailed as China’s top entertainment stock, with a peak market cap exceeding 90 billion yuan. The company produced blockbusters like "A World Without Thieves," "If You Are the One," and "The Wandering Earth," while managing stars such as Huang Xiaoming, Fan Bingbing, and Zhou Xun. It also attracted investments from Alibaba and Tencent, which remain key shareholders.
However, setbacks in diversification, scandals, and industry competition have plunged the company into losses. From 2018 to 2024, Huayi Brothers accumulated over 8.2 billion yuan in net losses. Its ventures into tourism (a 3.5 billion yuan Suzhou project sold in 2025) and gaming (a failed 1.9 billion yuan investment in Hero Entertainment) proved costly.
Recent releases like "Towards the Sun," "Lychee of Chang’an," and "The Volunteers: To the War" failed to reverse losses. In Q1–Q3 2025, revenue fell 46% year-on-year to 215 million yuan, with net losses widening by 168% to 114 million yuan.
Hopes now rest on Stephen Chow’s "The Mermaid 2," in post-production, and Feng Xiaogang’s "Catching Spies," starring Lei Jiayin and Hu Ge. The company is also pivoting to short-form content under the "Huayi Brothers Fire Drama" label and exploring AI-driven projects.
On the market front, Huayi Brothers’ stock has plummeted, closing at 2.23 yuan on December 12, with a market cap of just 6.187 billion yuan—less than a tenth of its peak value.
(Disclaimer: This information is for reference only and does not constitute investment advice.)
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