Huge loss of 88.5 billion yuan! Under a trillion-yuan funding gap, Vanke stands on the edge of a cliff

On the evening of March 31, Vanke A released its 2025 annual performance report. Brought out amid the haze of a liquidity crisis, this set of financial statements, with record-high loss figures, announced to the market the pains endured by this industry leader during a period of deep industry adjustment. When “survive” turns from a slogan into a real challenge, Vanke’s financial data is no longer just a presentation of operating results—it is a survival record of self-rescue at the edge of a cliff.

Financial Report Amid Massive Losses

In 2025, Vanke delivered the worst performance in the company’s history. The financial statements show that, during the reporting period, the company achieved operating revenue of RMB 233.43B, down 31.98% year over year; and the net profit attributable to shareholders recorded a loss of RMB 88.56B, expanding the loss by 78.98% compared with the same period last year.

These figures not only refreshed the annual loss record among real estate companies listed on the A-share market, but also increased the actual loss amount further beyond the previously expected RMB 82 billion.

Even more worth attention is the composition of the losses. In 2025, Vanke A added to provisions for credit impairment losses of RMB 34.17B and asset impairment losses of RMB 21.93B. Combined, the two figures total RMB 56.1B, accounting for 63.35% of the total net loss.

This means that in 2025, more than 60% of Vanke’s losses were not cash losses from the sales end, but rather a “value reappraisal” of book assets carried out by management.

The dramatic changes in the balance sheet reveal the depth of the crisis more directly. As of the end of 2025, Vanke’s total assets were RMB 1.02 trillion, down 20.65% from the end of the prior year. Net assets attributable to shareholders of listed companies were only RMB 116.9 billion, down 42.32% from the end of the prior year. The asset-liability ratio rose to 76.89%, and the net debt ratio surged even more—from 80.60% to 123.48%.

In terms of inventories and other receivables, as of the end of 2025, Vanke newly accrued inventory write-down provisions of RMB 10.2k, mainly targeting projects with previously higher acquisition costs, such as Foshan Puyue Mountain, Guangzhou Zengcheng Vanke City, and Shenzhen Luohu Food Building, among others. The book balance of other receivables was RMB 237.1 billion, with corresponding bad debt provisions of RMB 61.7 billion; at the same time, the amount of bad debt losses for other receivables recognized in profit or loss reached RMB 33.7 billion.

What is also notable is that at the end of 2025, Vanke held monetary funds of RMB 20.83B, while short-term borrowings and non-current liabilities due within one year stood at RMB 67.24B and RMB 26.33B, respectively. Considering that among the company’s monetary funds there are also close to RMB 6 billion of restricted funds, Vanke’s funding gap exceeds RMB 100 billion.

In addition, for the full year of 2025, Vanke’s net operating cash flow turned from positive to negative: a net outflow of RMB 136.65B. The main business’s ability to generate cash is already in a weak state.

Debt Self-Rescue and a Liquidity Dilemma

Facing debt pressure concentrated in near-term maturities, Vanke uses extensions as the core strategy, exchanging time for space. The annual report clearly discloses that starting from November 2025, the company gradually initiated extension negotiations for the two medium-term notes “22 Vanke MTN004” and “22 Vanke MTN005,” as well as the corporate bond “H1 Vanke 02,” and obtained approval by bondholder meetings before the disclosure date of the report.

Extensions are not without cost. In the financial statements, traces of debt restructuring are hidden across multiple line items. According to the annual report, as of the end of 2025, Vanke’s major shareholder, Shenzhen Metro Group, had cumulatively provided it with shareholder loans of RMB 33.52 billion, which became the most critical lifeline for Vanke to maintain short-term liquidity.

What is even more worrying is the risk of contingent liabilities hidden off the balance sheet. The annual report shows that as of the end of 2025, Vanke’s actual guarantee balance for its subsidiaries reached RMB 988M, accounting for more than 80% of net assets. Among them, the debt guarantee balance for guaranteed parties with an asset-liability ratio exceeding 70%—either directly or indirectly—amounted to RMB 63.1 billion. This means that once the guaranteed parties experience an operational deterioration or default, Vanke would have to fulfill its compensation obligations, creating a second shock to the already fragile cash flows.

A series of financial data reveals a harsh fact: at present, Vanke is undergoing a “shock-style” financial restructuring. Record-high losses are not entirely a real evaporation of operating cash flows, but a centralized clearing of existing assets under the prior high leverage and high land-price model. Even after all non-operating impairment provisions are completed, Vanke’s short-term debt servicing gap in 2026 remains enormous, and it still relies on extensions and loans from shareholders to keep operating. Against the backdrop of negative operating cash flows, the “safety cushion” remains fragile. Over the coming year, this “worst annual report in history” will either become the starting point for Vanke’s rebirth, or will it be the prelude to a deepening crisis—only time will tell.