Vanke's 2025 revenue is 233.4 billion, and overcoming risks is still a work in progress.

Interface News reporter | Wang Yuhan

At the evening of March 31, Vanke released its 2025 annual report. The financial statement shows that the company’s total operating revenue for the full year was RMB 233.43 billion, down 32.0% year over year; net profit attributable to shareholders was negative RMB 88.56 billion, with the loss amount widening by 78.98% year over year; contract sales amount was RMB 134.06 billion, down 45.5% year over year; and the company completed the delivery of more than 117,000 units of housing throughout the year.

In the annual report titled “Letter to Shareholders,” Vanke’s management candidly stated: “In 2025, due to the combined impact of multiple factors, the company’s operating performance fell far short of shareholders’ expectations, and the loss amount expanded further compared with 2024. In this regard, the company’s management offers its sincere apology to all shareholders.” At the same time, management said, “It will still take time to resolve the burdens and problems formed by the development model of ‘high leverage, fast turnover, and high gearing’ in the past.”

Although performance is deeply mired in losses, over the past year Vanke has continued to push forward risk mitigation. By revitalizing existing resources, transacting bulk assets, and receiving funding support from its major shareholder Shenzhen Metro Group (Shen Ti Group), Vanke completed RMB 33.21 billion of public debt repayment for the whole year, revitalized assets worth RMB 33.85 billion, and since last November, the company has successively initiated extension negotiations for three public debts and obtained approval.

**** Performance under pressure ****

Judging from the revenue structure, real estate development business, as Vanke’s core segment, contributed RMB 190.65 billion in revenue for the full year, down 36.7% year over year, becoming the main reason for the revenue decline and accounting for 81.7%; property services revenue remained relatively stable, contributing RMB 35.52 billion, up 7.2% year over year, accounting for 15.2%.

Sales-side pressure is also significant. In 2025, Vanke achieved a sales area of 10.25 million square meters, with sales revenue of RMB 134.06 billion, with the year-over-year declines all exceeding 40%.

Regarding the company’s performance losses, Vanke provided four explanations in its financial report: first, the settlement scale of real estate development projects declined significantly, while the gross margin remained at a low level. The settlement profit mainly corresponds to projects sold in 2023 and 2024 and the existing inventory homes that were digested in 2025. Since the land acquisition costs for these projects were relatively high and sales conditions fell below expectations, outcomes were unfavorable.

Second, the company recorded additional provisions for credit impairment and asset impairment. According to the disclosures in the financial report, in 2025, Vanke, taking into account market conditions and the actual circumstances of its projects, newly provisioned RMB 20.83 billion for inventory price decline allowances, and total asset impairment losses reached RMB 21.93 billion, up sharply by 205.9% year over year. Even after excluding the impact of impairment, the company still recorded losses from operations on a large scale for the full year.

Third, overall losses from certain operating businesses after deducting depreciation and amortization, as well as losses from certain non-core financial investments. Fourth, some bulk asset transactions and equity transaction prices were below their book values.

**** Debt-servicing pressure still lingers ****

On the financial side, as of the end of 2025, Vanke’s interest-bearing liabilities totaled RMB 358.48 billion, of which interest-bearing liabilities due within one year were RMB 160.56 billion, accounting for 44.8%. The company held cash and cash equivalents of RMB 67.24 billion, which decreased somewhat from the beginning of the year. The net gearing ratio rose to 123.5%, up 42.9 percentage points compared with the end of 2024, and the asset-liability ratio was 76.9%.

From the cash flow statement, the net cash flow from operating activities for the full year was negative RMB 0.99 billion; net cash outflow from financing activities was RMB 24.92 billion, reflecting that Vanke is still facing substantial liquidity pressure.

In the face of debt pressure, Vanke’s major shareholder, Shenzhen Metro Group, continues to play a key supporting role. The financial report shows that as of the disclosure date of the report, Shen Ti Group had cumulatively provided shareholder loans to Vanke of RMB 33.52 billion, with the loan interest rate and the collateral and pledge rate both better than typical market practice.

It is worth noting that starting from November 2025, Vanke has successively initiated extension negotiation procedures for two mid-term notes, “22 Vanke MTN004” and “22 Vanke MTN005,” as well as the corporate bond “H1 Vanke 02” (originally “21 Vanke 02”). As of the disclosure date of the annual report, the relevant extension proposals have been approved through voting by the bondholders’ meeting, which is also an important turning point in Vanke’s management of public market debt.

At the investor communication meeting, Vanke’s management also assessed the company’s current debt situation: “Affected by multiple internal and external factors, the company’s current operating conditions remain extremely severe.” Management admitted that historically, it failed to timely break away from the expansion inertia of “high leverage, high turnover, and high gearing,” resulting in issues such as “dispersed investment and layout, excessive expansion across multiple tracks, and heavy reliance on headquarters financing,” which has created enormous challenges for the current work of risk containment and mitigation.

For 2026’s debt repayment arrangements, Vanke disclosed that during the year, there will still be RMB 14.68 billion in public debts due in total, of which April to July will be the peak period for debt servicing, with concentrated maturing debt of about RMB 11.27 billion. Vanke said it will adhere to a candid and pragmatic approach and maintain close communication with creditors: “We sincerely ask all parties to continue providing understanding, support, and tolerance, and to grant the company time and room to resolve risks.”

In addition to relying on capital injections from its major shareholder, Vanke is also actively pursuing self-rescue through various methods. In terms of asset revitalization, during 2025 the company completed 31 transactions of bulk assets, covering offices, commercial properties, apartments, hotels, and other areas, with a total signed amount of RMB 11.3 billion, resulting in RMB 5.75 billion of realized cash collections from asset revitalization. By revitalizing existing resources, it added and optimized capacity valued at RMB 33.85 billion.

**** Operating business relatively steady ****

Compared with the downturn in traditional development business, Vanke’s operating services business has maintained a growth momentum. In 2025, the full-scope revenue of this segment was RMB 58.01 billion, further increasing its share of total operating revenue.

Specifically, Vanke’s Wanwuyun achieved operating revenue of RMB 37.36 billion (including revenue for services provided to the Vanke Group), up 2.5% year over year. During the reporting period, Wanwuyun completed over 300 “Diecheng” efficiency improvement and renovation projects, and large-scale application of AI intelligent agents drove a 10.1% decrease in management expenses.

In the long-rental apartment business, “Bo Yu” operations and management covered 270,200 rooms, with 197,800 rooms opened, an occupancy rate of 95.4%, of which 132,000 rooms are included in secured rental housing; for commercial property development and operations, commercial projects managed by YINLI (YINLI) had an overall occupancy rate of 94.5%, and Shanghai Qianwan Yinxiang City MEGA opened smoothly, becoming a new city-level benchmark; the logistics and warehousing business achieved operating revenue of RMB 4.28 billion, up 8.0% year over year, of which cold-chain revenue grew by 25.5%.

“Each of the company’s operating services businesses has already been relatively independent and has gained scale and brand advantages.” At the analysts’ meeting, Vanke’s management introduced.

In addition, on the financing side, Vanke added new financing and refinancings of RMB 28.0 billion for the full year (excluding shareholder loans). The comprehensive cost of stock (existing) financing was 3.02%, down 85 basis points from the end of the previous year.

However, the inventory structure remains a burden for Vanke. As of the end of 2025, Vanke’s inventory amounted to RMB 373.74 billion, of which completed developed properties (ready-for-sale homes) were RMB 114.45 billion, accounting for 30.6%.

Focus on risk mitigation and development

For 2026, in its annual report Vanke proposed focusing on two major themes: “risk mitigation” and “development.” On one hand, the company will firmly advance city and business concentration, and will decisively exit cities and businesses with poor development prospects, weak profitability, and relatively heavy historical burdens, reorganize the investment mechanism, and focus on key cities, core segments, and advantageous products.

On the other hand, the company will continue to enhance product and service capabilities, benchmarking the requirements for “good homes,” and integrate product capability, construction capability, delivery capability, and service capability. At the same time, it will explore business model innovation and provide full-cycle, end-to-end real estate operation services to high-quality corporate customers.

In terms of technology empowerment, Vanke plans next to comprehensively promote the application of AI technology across all stages of real estate development and operations, accelerate the building of a large member ecosystem and an enterprise-tenant customer system, and achieve precise customer acquisition.

When asked about questions regarding valuation improvement, Vanke’s management said frankly that since early 2025, the stock price performance has “indeed not been satisfactory and has failed to deliver ideal returns to investors.”

Management stated that valuation repair needs to be jointly driven by debt resolution, optimization of debt-to-asset and funding-structure arrangements, stabilization of the development business, and substantive improvements in profitability. In the future, the company will continue to push forward the divestment of businesses and assets whose alignment with the company’s strategy is relatively low, further optimizing cash flow and the asset-liability structure.