Konka Group, once China’s celebrated “TV king,” stunned markets with a 2025 earnings warning that forecasts a headline net loss of between RMB12.582 billion and RMB15.573 billion. The announcement sent the company’s share price tumbling about 23%, inflicting losses on roughly 140,000 retail investors and stoking talk of an imminent “*ST” special treatment and potential delisting if net assets turn negative after the year‑end accounts are filed.
The scale of the fall owes largely to a fourth‑quarter accounting shock. Konka had recorded a modest attributable loss of RMB982 million in the first three quarters of 2025, implying that the company expects to book about RMB11.6–14.6 billion of additional losses in the single final quarter. Management attributes the hit to sharply increased impairment provisions on inventories, receivables, equity investments, financial assistance and other low‑efficiency assets, plus recognition of contingent liabilities.
Operationally, Konka said its consumer electronics business continued to underperform as products lacked competitiveness, dragging revenue down to a projected RMB9–10.5 billion for 2025 (a year‑on‑year decline of 5.5–19.0%). Even after some cost control, gross margins were insufficient to cover expenses and the core consumer electronics arm remained loss‑making.
The collapse is the culmination of a decade‑long slide. Konka’s revenue peaked at RMB55.1 billion in 2019 and fell to about RMB11.1 billion in 2024, while the company posted consecutive net losses from 2022 through 2024. The TV division, which still generated over RMB14 billion in 2014, has shrunk by roughly two‑thirds; rivals such as Hisense and TCL seized market share as television manufacturing became increasingly commoditised.
Repeated pivot attempts failed to revive the firm. Konka expanded into property, environmental services, semiconductors, smartphones and home appliances, and even invested in a tourism resort, but none of these bets offset the decline of its core business. The company’s balance sheet has deteriorated markedly: a reported asset‑to‑liability ratio climbed to a record 96.78% through Q3 2025 and interest expenses reached RMB539 million over the same period.
State influence has grown as Konka moved into a new ownership phase. In 2025 China Resources (Huarun) completed a takeover, acquiring a 30% stake and installing a new board and management team. Huarun provided a RMB3.97 billion low‑interest loan to lower financing costs, but that lifeline has not remedied the structural problems now revealed by the year‑end write‑downs.
The governance picture has darkened further with disciplinary investigations announced into former senior executives, signalling a broader clean‑up under the new controlling shareholder. Regulators have already flagged past disclosure lapses, and the combination of negative equity, major impairment charges and regulatory scrutiny makes special treatment and possible delisting a realistic near‑term outcome.
Konka’s plight matters beyond one listed company. It illustrates the fate of mid‑sized legacy manufacturers in China that failed to upgrade product competitiveness amid fierce domestic and overseas rivalry, and it exposes the limitations of diversification strategies that lack coherent industrial logic. For creditors, suppliers and local workforces, the coming months will determine whether the company can be restructured under state guidance, re‑capitalised, or written down and removed from the stock market — with different implications for investor losses and regional economic pain.