Poly Developments and Holdings Group Co., Ltd., the leading real estate enterprise, saw a sharp 60% drop in land acquisitions, and reported its first quarterly loss in Q3.

Five months ago, Poly Developments and Holdings Group Co., Ltd. (Poly Development) was still aggressively acquiring land and had made achievements in core markets such as Shanghai and Beijing. However, after entering the third quarter of this year, the company's pace of land acquisition has significantly slowed down.

According to statistics from the China Index Academy, in the first half of this year, Poly Development ranked first in the industry with an equity land - acquisition amount of 41.4 billion yuan, spending an average of 6.9 billion yuan per month. But by the end of September, the company's land - acquisition amount had only increased to 49 billion yuan, dropping to the fifth place in the industry, with a gap of 26.9 billion yuan from China Overseas Land & Investment Limited.

In the third quarter, Poly Development only spent an average of 2.5 billion yuan per month on land acquisition, about one - third of that in the first half of the year.

What happened? Some reasons can be glimpsed from the data in the third - quarter report recently released by Poly Development.

01 

Continuous deterioration of profitability

On October 22, Poly Development released its third - quarter report for 2025. The data shows that the company's single - quarter revenue in the third quarter reached 56.865 billion yuan, a significant year - on - year increase of 30.65%, indicating a remarkable recovery. However, the profit side showed a cliff - like decline: the single - quarter net profit attributable to the parent company was a loss of 782 million yuan, a year - on - year decrease of 299.19%. This is the first time the company has suffered a loss during a non - year - end settlement period. The non - recurring net profit attributable to the parent company was a loss of 840 million yuan, a sharp year - on - year decline of 429.03%.

The data in the third - quarter report reflects a fact: Poly Development's profitability has been continuously deteriorating. In the first three quarters of this year, the gross profit margin was 13.37%, a year - on - year decrease of 2.55 percentage points. In the third - quarter alone, the gross profit margin was only 10.76%, a sharp year - on - year decline of 4.82 percentage points.

Meanwhile, Poly Development's cash flow was also under pressure in the third quarter. The net operating cash flow turned negative, reaching - 9.04 billion yuan, a year - on - year decrease of 875.12%. Coupled with an 8.7% year - on - year increase in sales expenses, the profit margin was further eroded.

Affected by the under - expected financial indicators, Poly Development's stock price continued to fall. According to the monitoring of Data Bao, on the day after Poly Development released its third - quarter report (October 23), 170 million yuan of support funds sold Poly Development's stocks, ranking first among individual stocks of traditional developers.

Regarding the reason for the profit turning into a loss, Poly Development explained that "affected by industry and market fluctuations, the profitability of the settled projects has declined."

However, from the financial report data, "minority shareholder equity" is the main reason for the decline in Poly Development's profits. In the third quarter, Poly Development's net profit attributable to the parent company was a loss of 782 million yuan, while the minority shareholder profit and loss reached 730 million yuan, resulting in the rare situation of "loss attributable to the parent company but profit for minority shareholders."

As of the end of the third quarter, the proportion of minority shareholder equity in the total owner's equity of Poly Development reached 42.64%, and the proportion of minority shareholder profit and loss in the total net profit in the first three quarters soared to 70.41%, a significant increase of 21.81 percentage points compared with 48.6% for the whole year of 2024. This means that about 70% of the profits are prioritized to be taken away, significantly reducing the profits distributed to the listed company's shareholders.

This structure of "small equity taking away large profits" makes the listed company bear a greater impact of losses directly when the project's profitability declines.

In the future, for the company's profits to recover, it will rely on the settlement of more high - quality projects to boost the overall profit level. However, according to the semi - annual report data of Poly Development this year, as of the end of June this year, the unsold land reserves in third - and fourth - tier cities were about 20 million square meters, and nearly 60% of them had not started construction. In the context that the market decline in third - and fourth - tier cities is higher than the national average, some projects will face the risk of "selling at a loss."

Poly Development has invested 51% of its funds in core areas such as Beijing, Shanghai, and Guangzhou this year to optimize the quality of land reserves. However, the newly acquired land projects will take 2 - 3 years to enter the settlement period, and in the short term, they cannot offset the decline in the profitability of existing projects. Guosheng Securities pointed out that this cycle mismatch of "existing projects dragging down and new projects not showing results" will continue to affect the company's profit performance in 2025.

Before the profit recovery, Poly Development has slowed down its land acquisition, which will further lengthen the company's future adjustment period.

02 

Hidden risks of decline

According to the latest data released by Poly Development, in the first three quarters of 2025, the company achieved a contracted sales amount of 201.731 billion yuan, a year - on - year decrease of 16.53%, and a contracted sales area of 10.1042 million square meters, a year - on - year decrease of 25.13%. This decline rate is higher than that of branded real - estate enterprises.

According to statistics from the China Index Academy, from January to September 2025, the total sales of the top 100 real - estate enterprises in the industry were 2.60659 trillion yuan, a year - on - year decrease of 12.2%. Among them, the average sales of the top 10 real - estate enterprises were 128.09 billion yuan, a decrease of 11.2% compared with the previous year.

The decline rate of Poly Development's performance is more than 5 percentage points higher than that of the first - tier real - estate enterprises.

Meanwhile, since the third quarter, the decline in Poly Development's sales has widened. At the end of the first half of the year, the company's sales decreased by 16.25% year - on - year. By the end of the third quarter, the decline had widened to 16.53%. Compared with the third quarter of 2024, the decline was as high as 20.18%.

After comparison, it is found that in the first half of this year, Poly Development's average monthly sales were about 24.2 billion yuan, but in the third quarter, it dropped to about 18.85 billion yuan per month on average.

Under the pressure of various performance indicators, Poly Development has actively reduced its construction starts. In the first three quarters of 2025, the company's newly started construction area was 5.12 million square meters, a year - on - year decrease of 40.19%, far higher than the decline rate of sales performance.

Compared with leading enterprises such as China Resources Land Limited, China Merchants Shekou Industrial Zone Holdings Co., Ltd., and China Overseas Land & Investment Limited, although Poly Development's current sales still rank first in the industry, its performance resilience is significantly weaker than that of its peers. Poly Development's commercial operation income in the middle of 2025 was 2.54 billion yuan, while China Resources Land's operating income from real - estate business was 12.11 billion yuan during the same period. Poly Development's commercial operation income is about 21% of China Resources Land's.

As a traditional real - estate developer, Poly Development is more closely bound to the overall development of the real - estate industry. The future performance trend will deeply depend on the recovery rhythm of the industry.