Konka, a household name that for decades led China’s television market, has reported a shock profit warning that pushes the company to the brink of insolvency. The maker of televisions and other appliances said it expects 2025 revenue of RMB90–105 billion and a net loss attributable to shareholders between RMB125.8 billion and RMB155.7 billion — a collapse that dwarfs last year’s loss of RMB32.96 billion and has wiped out shareholder equity on paper.
The market reacted violently: Konka’s A shares hit consecutive limit-down sessions and had lost more than 27% of their value within days of the warning. The firm also issued a notice forewarning a potential *ST designation — a regulator-flag that signals financial abnormality and places a company on a watchlist that can lead to delisting if remedial measures fail.
The proximate cause of the extraordinary fourth-quarter loss was a sweeping round of impairment provisions. Konka said it had written down inventories, receivables, equity investments, financial supports and a raft of low-efficiency assets — an accounting purge that follows year-on-year increases in impairment charges dating back to 2019. The company has already booked nearly RMB74 billion of new impairment charges through 2024; the 2025 provisions are the detonator that turned accumulated weakness into an immediate solvency crisis.
Underlying those write-offs are longer-term strategic and market pressures. China’s TV market has been shrinking since 2019 as consumers shift to phones and tablets for video consumption, and total television shipments in 2025 hit a 16-year low. Konka’s retail market share slipped to about 7.2% in 2024 and its weight in the high-end segment is negligible; rivals such as TCL expanded global shipments and shifted to higher-margin product lines, highlighting the cost of strategic missteps.
Konka’s troubles are not purely cyclical. Over the past decade the group diversified aggressively — from environmental engineering and real estate to semiconductors and new materials — and repeatedly changed senior managers. Those moves left the company with sprawling, low-related businesses and large capital commitments, some of them heavily sensitive to local policy and property-market cycles. Several high-profile projects and shareholder loans have strained cash flow, while recurring quality and after-sales complaints have eroded brand equity.
Governance concerns have compounded the financial pain. Former executives have been publicly disciplined for suspected violations, and internal whistleblowing and regulatory admonitions have flagged problems in disclosure and controls. Last year the controlling stake held by state-owned OCT was transferred to China Resources, which has since injected liquidity, extended guarantees and sought to stabilise operations by monetising assets and coordinating debt relief for subsidiaries.
China Resources’ intervention has bought breathing space: it has provided guarantees, rolling debt extensions and asset sales to bolster cash flow and has the potential to integrate Konka’s nascent semiconductor activity with its microelectronics units. But the semiconductor line is long-term and capital intensive, while many of Konka’s businesses need immediate restructuring. With liabilities of RMB282.7 billion and a reported debt ratio nearing 97% as of September 2025, the company faces stark choices: rapid asset disposals, heavy state-backed recapitalisation, formal restructuring or, in the worst case, delisting and bankruptcy proceedings.
Konka’s collapse is a cautionary tale for China’s industrial champions. It illustrates how secular demand shifts, weak strategic focus, aggressive diversification and lax governance can combine into a financial implosion. For investors, suppliers and policymakers the question is whether China’s system of state-linked rescues and corporate reorganisations can salvage productive parts of a once-iconic manufacturer — or whether Konka will become another example of a legacy name that failed to adapt.