XJ ELECTRICS (02619) has issued a profit warning, expecting to record a net loss of between RMB 30 million and RMB 35 million for the six months ending June 30, 2026. This represents a significant reversal from the net profit of approximately RMB 25.3 million reported for the same period in 2025.

The company attributed the anticipated loss to a combination of several key factors. Weak demand in overseas markets and uncertainty surrounding tariff policies were primary contributors, with a slowdown in global economic growth and softening demand for kitchen small appliances in the US during the first half of 2026. Frequent adjustments to tariffs in major export destinations also pressured foreign order volumes.

Additionally, a sharp rise in raw material costs since the beginning of the year has increased product costs and compressed profit margins. Currency fluctuations further compounded the issue, as the sustained depreciation of the US dollar against the Renminbi during the first half of 2026 led to significant exchange losses, given that the group primarily settles its export business in US dollars.