Almost a third of Russian companies were not profitable in the first half of the year

The 30.4% of Russian companies were not profitable according to official data from the first half of 2025, being the worst figure recorded since the pandemic, reported this Tuesday the Russian media Izvestia. This represents 2.3 percentage points more than in the same period of the previous year and the maximum since 2020, when the red numbers were present in the accounts of 35.3% of the companies. One of the main reasons for the increase in unprofitable companies is the high interest rates, which in the first half were between 20% and 21%, falling to 18% in August, explained Sergei Katirin, president of the Chamber of Commerce and Industry. The expert maintains that companies are also pressured by rising logistics costs, changes in legislation, and the tax on profits, which rose from 20% to 25%, so profitability has fallen noticeably in many sectors. From the Ministry of Economic Development, they maintain that the indicator presents a marked seasonality characterized by rising values, while at the end of the year there is a decrease, in addition to other issues related to demand and technological investment. According to Rosstat, the Federal State Statistics Service of Russia, the biggest losses are recorded in coal mining, water supply, waste management, passenger land transport and scientific research, where nearly half of the companies are in the red. Still in July, Deputy Energy Minister Dmitri Islamov admitted that more than a quarter of Russian coal sector companies closed or are about to close due to the fall in exports because of the sanctions imposed by the West following the start of the war in Ukraine in 2022. Regarding transportation, the problem is common to all its branches, because since contracts are generally signed in the long term, they are corrected belatedly in relation to the increase in expenses, such as inflation, wage increases, the cost of maintaining foreign equipment and machinery, and increases in credit prices. Meanwhile, according to official statistics, the sectors in which up to a quarter are in losses are paper production, rubber and plastic products, the textile industry, pharmaceuticals, and wholesale trade. The information technology industry shows positive results, which also receives tax exemptions, although the good numbers of the segment of the complex related to the military industry also stand out, whose revenues have doubled or even tripled. Experts cited by Izvestia agree that the increase in losses leads to a decrease in tax revenues, a fall in investment activity and an increase in the debt burden, which will increase the pressure on banks, which will be forced to restructure their loans. It also represents an additional burden for the State, which will have to organize subsidy plans and rescues for sectors it considers key, as has already happened with coal.

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In the long run, these trends can curb economic growth and exacerbate structural imbalances, warn experts, who see the lowering of interest rates as a key measure to reverse the situation. The Russian Central Bank will meet on September 12th to discuss credit policy.