Over 20 billion yuan loss in a year? Understanding the prudence and long-term value of Meikailong

Ask AI · Why does Maike Laiang regard asset impairment as a prudent strategy?

It is worth noting that behind the book losses, the company’s core operating indicators have already shown positive signals.

Produced by | China Visitor Network

Reviewed by | Li Xiaoyan

On March 30th, the leading domestic home furnishing market Maike Laiang (601828.SH) released its 2025 annual report, achieving a total revenue of 6.58B yuan for the year, with a net cash flow from operating activities reaching 816 million yuan, a significant increase of 277.34% year-on-year. Despite a net loss attributable to shareholders of 23.72B yuan for the period, mainly due to prudent adjustments of the fair value of investment properties and asset impairments under industry cycles, after excluding non-recurring gains and losses, the company’s main business is demonstrating resilience in bottoming out and stabilizing, with the long-term value of its transformation and layout gradually becoming apparent.

As a home furnishing industry leader with years of deep cultivation, Maike Laiang’s performance fluctuations are closely related to the profound adjustments in the real estate industry and the phased pressure on home furnishing consumption demand. By 2025, the nationwide new housing construction area will have fallen by over 70% compared to 2021, and the weakening demand for new home deliveries directly led to a sharp decline in supporting home renovation procurement; nationwide, the rent for 100 streets shops decreased by 0.81% year-on-year, and the rent for 100 MALL shops decreased by 0.34% year-on-year, with commercial real estate rents remaining under pressure. Coupled with the impact of new business formats diverting traffic, traditional home furnishing markets face unprecedented operational pressures. Against this backdrop, Maike Laiang conducted a centralized valuation adjustment of its core investment properties according to accounting standards, resulting in an approximate fair value change loss of 23.44B yuan, accounting for 98.8% of the net loss for the period. Although this book adjustment amplified short-term performance fluctuations, it genuinely reflects asset values under industry cycles and further demonstrates the company’s prudent attitude of consolidating asset quality and returning to operational fundamentals.

It is worth noting that behind the book losses, the company’s core operating indicators have already shown positive signals. In 2025, Maike Laiang’s core home furnishing commercial service segment’s gross profit margin increased by 2 percentage points to 61.9%, indicating steady optimization of main business profitability; net operating cash flow significantly increased year-on-year, confirming the effectiveness of cost reduction, efficiency enhancement, and stabilizing and retaining merchants, also providing solid financial support for subsequent transformation. Facing challenges such as declining customer flow and pressure on rent income, the company stabilized its merchant base through rent reductions and preferential concessions, while optimizing the mall format mix by introducing high-end appliances, automobiles, catering, and other diverse formats, releasing potential category operating areas, and enhancing the overall competitiveness of the malls, thus laying a foundation for improving operational quality.

During the critical period of transformation, Maike Laiang accelerated its shift from traditional home furnishing markets to a “new home furnishing lifestyle operator” through strategic upgrades. In 2025, the company deepened the implementation of the “1001 Strategy,” promoted the upgrade of the “3+Star Ecosystem,” and built a collaborative development pattern of “home + appliances + decoration,” driving the business from channel sales to scene-based services and ecological empowerment. The high-end appliance business accelerated its upgrade, launching the “Mega-E Smart Electric Oasis” 2.0 strategy in May, with a plan to create 40 ecological benchmark stores in three years. By mid-year, 50 stores had already been established, making it one of the fastest-growing business segments; automotive category recruitment continued, covering 44 cities and over 30 brands, further enriching consumption scenarios and expanding customer acquisition channels. Meanwhile, leveraging the resource advantages of its controlling shareholder Jianfa Shares, the company connected the entire chain of “buying a house - decorating - home purchase,” bringing the home furnishing consumption scenario forward to the home buying stage, achieving ecological synergy and empowering new growth paths.

In terms of organizational governance, Maike Laiang promotes a smooth transition by advancing the professionalization and youthfulness of its management team, injecting new vitality into transformation and development. By 2025, the company completed core management adjustments, with founder Che Jianxing resigning as general manager and being replaced by Executive Director Shi Yaofeng, while optimizing the board structure and introducing professional management talent. Despite experiencing short-term personnel fluctuations, the company maintained stable daily operations, continuously improved internal control mechanisms and organizational structure, providing a solid guarantee for the implementation of strategies. After the management change, the new team focused on deepening core business and ecological expansion, setting a development goal that the core home furnishing category’s operating area share would not be less than 70%, and promoted a shift from scale expansion to a quality and efficiency-oriented transformation.

From an industry cycle perspective, Maike Laiang’s short-term difficulties are both a concentrated reflection of industry adjustments and an important opportunity for transformation breakthroughs. With continuous policy support for real estate since 2026, including lowering existing mortgage rates and broadening financing channels for commercial real estate, the real estate market is gradually stabilizing and warming, and home furnishing consumption demand is expected to be gradually released. At the same time, the penetration rate of integrated decoration models is increasing, and the proportion of renovation demand for existing homes has exceeded 50%, shifting the industry from a growth market to a stock market, providing new growth space for companies with ecological layout advantages. Relying on years of accumulated channel networks, brand reputation, and ecological resources, Maike Laiang is expected to seize opportunities in the industry recovery and achieve continuous improvement in operating performance.

As a benchmark enterprise in the home furnishing industry, Maike Laiang is consolidating its foundation through value revaluation and cultivating new energy through ecological transformation. Short-term performance fluctuations do not change the long-term development logic; asset adjustments are an inevitable choice under industry cycles. Its main business resilience, transformation results, and governance optimization will jointly drive the company through cycles and realize the leap from traditional markets to a comprehensive home ecosystem platform. In the future, as industry recovery and transformation dividends are released, Maike Laiang is expected to gradually return to a value-oriented track and continue writing a new chapter of high-quality development in the home furnishing industry.

Personal opinion, for reference only.