(Yicai) May 6 — Twenty-two major players in China’s photovoltaic industry reported aggregate losses of CNY10.5 billion (USD1.5 billion) in the first three months amid tumbling raw material prices and sluggish end demand despite ongoing efforts to cut excess capacity.
Revenue sank 11.6 percent to CNY95.8 billion (USD14 billion), reflecting a pattern of shrinking scale alongside persistent losses, according to Yicai’s analysis of the financial reports of the 22 listed firms. And losses excluding non-recurring items reached CNY13.2 billion.
For industry giants such as Tongwei, Longi Green Energy Technology and TCL Zhonghuan, this was their 10th consecutive quarter of losses.
Tongwei’s net loss narrowed 5.7 percent year on year to CNY2.4 billion (USD352 million) while revenue plunged 23.9 percent to CNY12.1 billion (USD1.7 billion). TCL Zhonghuan racked up a net loss of CNY1.6 billion (USD234 million), even though revenue climbed 7.3 percent to CNY6.5 billion (USD954 million). And Xi’an-based Longi reported a net loss of CNY1.9 billion, widening by 34.2 percent.
Xinjiang Daqo New Energy fared particularly badly. The silicon material producer saw revenue plummet 79.2 percent to CNY189 million (USD27.7 million), the lowest quarterly revenue since it went public in October 2010. And the Shihezi-based firm’s net loss widened 42.5 percent to CNY801 million (USD117.6 million).
The root cause of these losses is the sharp decline in upstream prices. The average price of N-type multi-crystalline silicon raw material tumbled to CNY40,500 (USD5,900) per ton at the end of March from CNY59,200 in early January, a quarterly drop of approximately 24.7 percent. Prices of various silicon wafer models also slumped by more than 24 percent.
The silicon wafer and silicon material sectors have been the hardest-hit segments. The battery segment, though, has proved to be relatively resilient. The higher penetration of N-type technology has helped support some product price premiums. Hainan Drinda New Energy Technology narrowed its net loss to CNY44 million (USD6.4 million) in the first quarter, after excluding non-recurring items.
By contrast, the module segment saw declining revenues but improved profitability year on year, helped by lower raw material costs and deliberate production cuts aimed at preserving margins, which partially offset weak demand.
Several leading solar firms began to voluntarily reduce production after the Political Bureau of the Central Committee of the Communist Party of China, which is the country’s top decision-making body, proposed to combat ‘involution,’ or disorderly, cutthroat competition, in July 2024. However, given the industry’s substantial existing production capacity, the impact of these measures has been slower than expected.
The industry remains in a state of oversupply, but positive factors are gradually emerging, Longi Chairman Zhong Baoshen said at the earnings call. The government’s roll out of measures to combat ‘involution’ and the continued shift toward competition driven by market forces, mean that this year could be a crucial year for the PV industry in terms of consolidation and quality-focused development.
Looking ahead to the second quarter, wafer prices have started to stabilize following a rebound in silicon material prices. However, battery cell prices have begun to decline more rapidly, with prices dropping more than 7 percent in a single week in April. Whether the industry can reach a turning point in earnings will depend largely on the pace of recovery in downstream installation demand.
Editor: Kim Taylor

source