China’s photovoltaic industry is currently going through an unprecedented deep adjustment as it grapples with long-term overcapacity and intense price wars. According to the latest financial data, in the first half of 2025, the combined net losses of the top five photovoltaic companies in China amounted to a staggering 17.264 billion yuan.
Over the course of seven consecutive quarters of industry downturn, the severe overcapacity in China’s photovoltaic industry has become increasingly prominent. The supply-demand imbalance has led to a drastic drop in product prices across various segments of the industry chain, with enterprise operating rates generally remaining low. Upstream core segments such as polysilicon and silicon wafers have even experienced negative production growth.
Companies with diversified operations like Tongwei Group have been significantly impacted. Data shows that Tongwei Group incurred a net loss of 4.955 billion yuan in the first half of the year, marking its largest historical loss for the same period.
Longi Green Energy, a leading producer of silicon wafers and solar modules, managed to maintain growth in shipments of silicon wafers and battery components in the first half of the year. However, due to market prices falling below production costs, the company’s revenue decreased by 14.83% year-on-year, resulting in a net loss of 2.569 billion yuan.
TCL Clean Energy, focusing on silicon wafer business, saw its photovoltaic silicon wafer gross profit margin reach -23.74% due to severe oversupply, leading to a net loss of 4.242 billion yuan.
JA Solar disclosed its first mid-year loss since going public, with a net loss of 2.918 billion yuan. JinkoSolar incurred a net loss of 2.58 billion yuan in the first half of the year, despite a slight narrowing of losses in the second quarter, the overall scale of losses has significantly expanded compared to the same period last year.
Looking at the upstream segments of the industry chain, the polysilicon materials sector is experiencing a severe oversupply issue. Several leading polysilicon companies like Daqo New Energy, GCL-Poly Energy Holdings, and Xinjiang Daqo New Energy have witnessed a sharp decline in revenue and substantial losses.
Due to the slow progress in phasing out inefficient production capacity and the continuous release of new capacity, the oversupply situation in the polysilicon market has not fundamentally improved. The latest report from the Silicon Industry Branch of the China Nonferrous Metals Industry Association shows that the production of polysilicon has continued to increase in July and August, indicating lingering supply-side pressure.
Many companies have issued risk warnings in their financial reports. Tongwei Group believes that the inevitable elimination of outdated production capacity may pose severe operational risks to the industry if supply-demand contradictions are not eased.
Longi Green Energy acknowledges the consensus on “anti-inner clogging” within the sector but states that specific plans have not yet been set, leaving enterprises to continue facing operational pressures in the short term.
Meanwhile, Canadian Solar has stated that if future capacity adjustment speeds lag behind or downstream market growth fails to meet expectations, product prices may further decline, impacting corporate profits.
Simultaneously, industry data indicates that after experiencing a surge in installations and hoarding frenzy in the first half of the year, domestic photovoltaic new installations in China saw significant declines in July compared to the previous month and the same period last year, marking a new low for the year.