Vanke's Q1 revenue fell by nearly 24% year-on-year, net loss narrowed slightly to 5.95 billion yuan | Financial Report Insights

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Vanke A disclosed its 2026 Q1 report on the 29th, with performance continuing a deeply pressured trend.

During the reporting period, the company achieved operating revenue of 28.93 billion yuan, a significant year-on-year decrease of 23.9%; the net loss attributable to shareholders of the listed company was 5.95 billion yuan, slightly narrowed compared to last year’s loss of 6.25 billion yuan, a year-on-year decrease in loss of about 4.7%. This marks several consecutive quarters of losses for Vanke, with the continued drag from real estate development business remaining the core issue.

From a positive signal perspective, the overall gross profit margin rebounded to 9.1%, an increase of 3 percentage points year-on-year, showing initial effectiveness in cost control. Meanwhile, net cash outflow from operating activities narrowed significantly from 5.79 billion yuan last year to 2.16 billion yuan this quarter, an improvement of 62.7%, indicating progress in curbing operating expenses.

However, the decline in the main real estate development business remains alarming. Contract sales in Q1 were only 16.77 billion yuan, a year-on-year plunge of 53.8%; settlement revenue was 14.57 billion yuan, down 36.1% year-on-year. At the same time, the asset-liability ratio remains high at 77.1%, with total interest-bearing debt at 356.05 billion yuan, and debt pressure is still intense.

Revenue down 23.9%, development business drags the overall picture

Vanke's total operating income in the first quarter was 28.93 billion yuan, down 23.9% year-on-year, of which real estate development business contributed 14.57 billion yuan, down 36.1% year-on-year, as the main factor dragging down overall revenue. In contrast, the operating services business performed relatively steadily, contributing 12.48 billion yuan, a slight increase of 1.7% year-on-year, becoming an important "ballast stone" for performance.

Looking at the income statement details, non-operating expenses surged 139.5% year-on-year to 660 million yuan, mainly due to increased late fees, reflecting continued pressure in debt repayment. Income tax expenses saw an abnormal jump, changing from a tax benefit of 320 million yuan last year to an expense of 1.11 billion yuan this quarter. The reason is that while the group incurs overall losses, some subsidiaries still generate taxable profits, and the reversal of deferred tax assets further erodes profit space.

Sales sharply decline, destocking pressure remains high

Sales data for the real estate development business is worrisome to the market. In Q1, Vanke achieved contracted sales area of 1.401 million square meters and contracted sales of 16.77 billion yuan, down 42.2% and 53.8% year-on-year, respectively, much larger declines than the industry's overall level.

As of the end of Q1, Vanke's consolidated statements still include 10.533 million square meters of sold-but-not-yet-delivered resources, corresponding to contracted amount of 107.2 billion yuan. This large pool of unsettled resources is both a potential source of future revenue and a continuing need for funds to complete delivery.

Q1 new starts and resumptions covered an area of 692,000 square meters, completing only 22.6% of the annual plan; completed area was 983,000 square meters, completing only 13.2% of the annual plan. The pace of starts and completions was overall slow, possibly due to tight funding and weak market demand. Notably, Vanke delivered 30 projects comprising 7,600 housing units in Q1, of which 32.1% achieved delivery 30 days ahead of schedule—"guaranteed delivery" execution remains stable.

Operating services business: Diversified performance, a highlight

Amid deep pressure on the development business, Vanke's diversified operating service segments show strong resilience, becoming a key pillar of the company’s fundamentals.

Property services: Onewo, leveraging the AI real estate management system "Lingshi," continued expanding from residential scenarios to industrial parks, city blocks, etc., and won bids for super-large projects such as Guangzhou University of Chinese Medicine Shunde Hospital, Xiamen University First Affiliated Hospital, in Q1. The tech-empowered strategy is starting to pay off.

Rental housing: Q1 achieved operating income of 724 million yuan. By end March, operated and managed 251,000 long-term rental apartments, with occupancy rate steady at 93.7%. The average lease term increased to 366 days, up 51 days year-on-year, continuously enhancing customer stickiness.

Commercial development & operation: Q1 operating income was 2.08 billion yuan (including off-balance-sheet), up 7.3% year-on-year. Overall occupancy rate of commercial projects managed by SCPG was 93.1%. Brand events such as "Fafa Season" lifted store traffic by 6.8% and store sales by 6.1% year-on-year in Q1.

Logistics & warehousing: Q1 operating income was 1.09 billion yuan, up 9.8% year-on-year, with cold-chain business income at 640 million yuan, up 28%; service revenue was 410 million yuan, up 38% year-on-year. Income from TOP30 cold chain customers soared 59% year-on-year, showing strong growth momentum.

Under heavy debt pressure, financing costs continue to fall

As of the end of the reporting period, Vanke held 60.49 billion yuan in monetary funds, total interest-bearing debt at 356.05 billion yuan, asset-liability ratio at 77.1%, and the debt structure remains highly tense. Total current liabilities are 557.1 billion yuan, of which non-current liabilities due within a year are as high as 136.68 billion yuan, highlighting considerable short-term repayment pressure.

In debt management, Vanke continued to gain support from financial institutions in Q1. The overall average cost of outstanding financing dropped to 2.88%, down another 14 basis points from last year end. Domestic average cost of outstanding financing was even lower at 2.62%. Major shareholder SZ Metro Group cumulatively provided new shareholder loans of 2.73 billion yuan this year up to the disclosure date, with financing cost at just 2.34%; it also agreed to extend principal and interest of 274 million yuan for shareholder loans originally due in Q1, providing crucial liquidity support.

Additionally, proposals to extend "22 Vanke MTN004" "22 Vanke MTN005" "23 Vanke MTN001" medium-term notes and "H1 Vanke 02" corporate bond have been approved by bondholder meetings, easing short-term liquidity risks to a certain extent.

Cash flow improves, asset disposals advance steadily

Cash flow saw positive changes. Q1 net cash outflow from operating activities was 2.16 billion yuan, significantly narrowed from 5.79 billion yuan last year, a 62.7% reduction, mainly due to effective curbing of operating expenses. Net cash outflow from financing activities was 4 billion yuan, down about 58.9% year-on-year, with repayments scaling back compared to last year.

On asset disposal, Vanke completed the disposal of Guangzhou Yuncheng parking lot asset package, transaction amount was 87 million yuan, achieving an orderly exit from non-core assets. Additionally, the Shiniushan project in Qingdao's Licang District was revitalized from commercial to residential land through "collection, planning adjustment, and re-offering." Shanghai Xinyao Zhongcheng project boosted asset value by 240 million yuan via relaxing restrictions on self-held rental housing. Activation of existing resources is advancing on multiple fronts.

Equity structure remains stable, SZ Metro Group continues support

In terms of shareholder structure, SZ Metro Group holds a stake of 27.18% (3.24 billion shares), remaining the largest shareholder. Its state-owned background provides an important credit endorsement for Vanke. Shenzhen Metro's loss in 2025 is about 37.197 billion yuan, and it recognized an investment loss from long-term equity investment in Vanke shares.

As of the end of the reporting period, the company's total share capital was 11.93 billion shares, including 9.72 billion A-shares and 2.21 billion H-shares, with equity structure stable and no significant changes.

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