The proportion of related-party transaction revenue for Wanwu Cloud has decreased to 6%. Management: Risk exposure has been further narrowed.

Ask AI · How can the decline in WeCloud’s related-party transaction ratio enhance business independence?

Beijing News Shell Finance reported by Ji Wenping (Reporter Duan Wenping) On the morning of March 20, 2025, WeCloud held its 2025 annual results press conference. The data show that in 2025 WeCloud’s revenue was RMB 37.27 billion, up 2.7% year over year, and after excluding developer-related businesses, revenue grew 8.4% year over year. As the core pillar of revenue growth, the company’s recurring business generated RMB 33.40 billion in revenue for the full year, up 8.5% year over year, and its share of total revenue rose to 89.7%, fully demonstrating the stability of its core business.

However, WeCloud’s gross margin on residential property management services fell slightly by 0.7 percentage points. In response, He Shuhua, Vice Chairman of WeCloud, Executive Director, and Chief Operating Officer, said: “Thanks to our commitment to the Diecheng strategy over the past few years, we have managed to offset the rigid increase in project costs relatively well. But on the handover-from-developer side, it has indeed caused fluctuations in gross margin. There are two core reasons: first, the collection rate fell; second, newly accepted projects are in a ramp-up period.”

On the morning of March 20, WeCloud held its 2025 annual results press conference. Screenshot of the results press conference

“Getting paid is difficult—this may be an industry-wide problem.” He Shuhua said. According to data from CRIC, in 2025 the average collection rate of the top 500 property management companies nationwide had already dropped to 71%, showing a downward trend for four consecutive years.

Facing these issues, He Shuhua said the company is actively responding. First, it sticks to the Diecheng strategy, and through professionalized operations, redeployment of labor, and the extensive introduction of robot operations, it helps significantly improve project operating efficiency. Second, it assists developers in selling off remaining inventory units; the cash collected from selling off the remaining units is prioritized for paying property management fees for vacant homes. “Given the current market environment, we do not choose passive waiting, but instead turn passivity into initiative. That is one of our major strengths.” Third, it pursues lean operations, tightening control of the minimum baseline standards for taking on new projects, and for loss-making projects accumulated in the past, it specifically sets up a dedicated remediation team.

In He Shuhua’s view, as project operations gradually stabilize, profitability will gradually recover.

What is noteworthy is that WeCloud’s business independence has further strengthened. The data show that in 2025 the share of income from continuing related-party transactions declined by 3.5 percentage points to 6%. Although overall performance is still affected by related businesses, after excluding developer-related business, core net profit grew 11.1% year over year.

Adhering to a prudent principle, in 2025 WeCloud further made an impairment allowance of RMB 740 million for amounts owed by related parties, an increase of RMB 480 million year over year. The impairment allowance action, together with the high costs brought by large numbers of vacant units, caused WeCloud’s net profit during the performance period to decline year over year.

In response, management said, “Recognizing credit impairment losses and proactively narrowing risk exposure may bring short-term earnings pain, but in the long run, it helps lay a solid foundation for high-quality development.”

At the results conference, Wang Xubin, WeCloud’s finance director, pointed out that the share of related-party business continues to decline, which is the result of the company’s proactive management. Looking ahead to 2026, it is expected to decline further. “Regarding the issue of receivables from existing related parties that everyone is concerned about, we always place risk control and cash recovery first. At present, our overall risk exposure is also continuing to narrow.”

Editor: Yang Juanjuan

Proofreader: Zhao Lin