Group 1: Overall Industry Performance - The home appliance sector's revenue in Q2 2025 increased by 4.78% year-on-year to 431.5 billion yuan, with net profit attributable to shareholders rising by 3.38% to 38.1 billion yuan, indicating steady growth [1] - The "trade-in for new" policy is driving domestic demand, with the white goods segment showing an upward trend in domestic sales [1] Group 2: White Goods Sector - The white goods segment's revenue in Q2 2025 grew by 4.64% year-on-year to 303.2 billion yuan, supported by favorable domestic policies and increased demand for air conditioning due to high temperatures [2] - The net profit attributable to shareholders in the white goods sector increased by 6.08% year-on-year to 30.6 billion yuan, with a significant improvement in operating cash flow, which rose by 48.18% [2] Group 3: Black Goods Sector - The black goods segment's revenue in Q2 2025 rose by 5.81% year-on-year to 50.8 billion yuan, with improvements in product structure and a relatively stable cost environment for LCD TV panels [3] - However, the net profit attributable to shareholders in the black goods sector decreased by 1.04% year-on-year to 1.033 billion yuan, reflecting a divergence in financial performance among leading brands [3] Group 4: Kitchen Appliances Sector - The kitchen appliances segment experienced a revenue decline of 6.95% year-on-year to 12.4 billion yuan, primarily due to sluggish real estate conditions and increased difficulty in claiming subsidies [4] - The net profit attributable to shareholders in the kitchen appliances sector fell by 16.75% year-on-year to 1.96 billion yuan, indicating a decline in profitability [4] Group 5: Smart Home Sector - The smart home segment saw a significant revenue increase of 32.09% year-on-year to 12.564 billion yuan, driven by domestic promotions and overseas market growth [5] - However, the net profit attributable to shareholders in the smart home sector decreased by 12.95% year-on-year to 1.026 billion yuan due to increased marketing expenditures [5] Group 6: Traditional Small Appliances Sector - The traditional small appliances segment's revenue declined by 0.69% year-on-year to 23.1 billion yuan, with some companies experiencing negative growth due to changes in tariff policies and weakened external demand [6] - The net profit attributable to shareholders in this sector fell by 12.44% year-on-year to 1.344 billion yuan, reflecting pressure on profitability [6]

Investment Rating - The report maintains an "Outperform" rating for the home appliance industry [8][15]. Core Insights - The home appliance sector shows steady growth, with white goods domestic sales improving and external tariff impacts becoming evident. Leading brands demonstrate resilience, while cleaning product leaders experience high growth. Increased marketing expenses in discretionary categories have led to a slight decline in profitability. Future outlook suggests that trade-in programs will support domestic demand, and leading brands along with emerging categories will contribute to revenue growth, indicating investment value [4][15]. Summary by Sections Overall Performance - In Q2 2025, the home appliance sector's revenue increased by 4.78% year-on-year to 431.5 billion yuan, with a net profit attributable to shareholders rising by 3.38% to 38.1 billion yuan. The first half of 2025 saw revenue growth of 8.59% to 842.6 billion yuan and net profit growth of 11.23% to 71.2 billion yuan. The cost environment improved due to a decline in raw material prices and shipping costs [19][29]. White Goods - The white goods segment's revenue grew by 4.64% year-on-year to 303.2 billion yuan in Q2 2025, with net profit increasing by 6.08% to 30.6 billion yuan. Domestic demand is supported by favorable policies and high temperatures driving air conditioning needs. However, external sales showed weakness due to tariff impacts [10][20]. Black Goods - The black goods segment reported a revenue increase of 5.81% year-on-year to 50.8 billion yuan, but net profit decreased by 1.04% to 1.0 billion yuan. The segment faced challenges from fluctuating U.S. tariff policies and varying performance between self-owned brands and OEMs [11][29]. Kitchen Appliances - Kitchen appliance revenue declined by 6.95% year-on-year to 12.4 billion yuan, with net profit down by 16.75% to 1.96 billion yuan. The decline is attributed to sluggish real estate conditions and increased difficulty in subsidy applications [12][19]. Smart Home - The smart home segment experienced a significant revenue increase of 32.09% year-on-year to 12.6 billion yuan, although net profit fell by 12.95% to 1.0 billion yuan due to increased marketing expenditures [13][19]. Traditional Small Appliances - Revenue for traditional small appliances decreased by 0.69% year-on-year to 23.1 billion yuan, with net profit down by 12.44% to 1.3 billion yuan. The segment faced challenges from changing tariff policies and reduced external demand [14][19]. Upstream Performance - The upstream sector saw a revenue increase of 5.07% year-on-year to 29.5 billion yuan, with net profit rising by 12.56% to 2.2 billion yuan. The upstream segment's profitability improved due to better cost management [19][25].