China industrial profits jump 15.8% in March, fueled by AI and chip boom despite oil shock risks

china's industrial profits jumped 15.8% in march from a year earlier — the fastest pace in six months, according to the national bureau of statistics. that accelerated from a 15.2% surge in the first two months of the year. for the first quarter overall, profits expanded 15.5%, the strongest start to a year since 2017 outside the pandemic spike in 2021. the equipment and high-tech manufacturing sectors drove the gains, with profits up 21% and 47.4% in the quarter, respectively, per nbs chief statistician yu weining. the ai and chip boom fueled outsized subsector growth: optical fiber makers saw profits jump 336.8%, optoelectronics makers rose 43%, and display device manufacturers gained 36.3%. drone makers posted a 53.8% profit increase, and other intelligent consumer device makers gained 67.3%. raw material producers' earnings rose 77.9% as oil refineries swung to profit. the upswing follows a 2025 where industrial profits eked out just 0.6% growth after three straight annual declines. robust manufacturing exports underpinned the improvement, said pinpoint asset management's zhiwei zhang — china's exports grew 14.7% in the first quarter, the fastest since early 2022. but the middle east conflict poses a headwind: brent crude has surged about 48% since the u.s.-israel strikes on iran began in late february, driving up costs for chemicals, fibers and plastics. the trump administration also sanctioned a chinese "teapot" refinery for buying iranian oil, threatening a source that accounts for a quarter of china's refinery capacity.