Yu Weining attributed the growth to accelerated factory activity and rising product prices during the period. High-tech manufacturing led the gains, with profits in sectors such as semiconductors and unmanned aerial vehicles jumping 58.7% year-on-year.
Raw material producers also benefited, with non-ferrous metals seeing profit growth of 148.2%, and chemical manufacturers reporting a 35.9% increase. Analysts said the results reflected both stronger domestic production and sustained export demand, as Chinese firms capitalised on global markets to offset slower consumer spending at home.
Despite the optimism, Yu warned of potential risks from “escalating geopolitical tensions,” highlighting that uneven sectoral recovery and global uncertainties could temper growth prospects. The report alluded to disruptions in oil shipments stemming from recent U.S.-Israeli attacks on Iran, which led Tehran to close the Strait of Hormuz, a key energy transit route.
China has moved to mitigate domestic economic impacts, raising retail gasoline and diesel ceiling prices moderately while relying on its strategic oil reserves and alternative energy sources. Iranian crude exports to China have continued despite the conflict, helping cushion the economy against surging global energy prices.
Overall, the early 2026 profit rebound follows a modest 0.6% rise in industrial profits for 2025, ending three consecutive years of declines. Observers say the trend underscores Beijing’s ongoing efforts to stabilise industrial output, support high-value manufacturing, and navigate the challenges posed by global energy volatility and uneven domestic consumption.