China’s National Energy Administration (NEA) reported 11.04 GW of new solar capacity in July, down about 48% year-on-year. Even so, additions reached 223.25 GW in the January–July period, lifting total installed solar capacity to 1.11 TW, up 50.8% year-on-year.

The sharp July slowdown underscores a deep adjustment underway across the industry.

First, business performance is diverging across market players. Among Chinese leaders, signs of stabilization are emerging. LONGi posted first-half 2025 revenue of RMB 32.813 billion and narrowed losses by RMB 2.661 billion year-on-year. Its back-contact (BC) modules shipped around 4 GW, reaching more than 70 countries. Meanwhile, JA Solar reduced its Q2 loss by over 40% quarter-on-quarter; operating cash flow has improved for three straight quarters, with a single-quarter net inflow of RMB 3.7 billion.

By contrast, international inverter major, SMA Solar, was hit hard. The company posted a EUR 42.4 million net loss in the first half—a 196.1% year-on-year plunge—with shipments down to 8.3 GW, pushing it out of the global top five in inverter shipments.

At the same time, large-scale bases and new applications are emerging as bright spots. China Three Gorges (CTG) launched tendering for the Kubuqi Desert (central–northern Ordos) new energy base: 8 GW of PV and 4 GW of wind paired with 5 GWh of storage, with total investment estimated at around RMB 80 billion.

In building-integrated photovoltaics (BIPV), the strategic cooperation between LONGi and Center Int achieved a breakthrough for curved coal-storage sheds. Using a contour-following mounting scheme and an arched cleaning robot, it addressed complex curved-surface installation challenges and advanced work on the 'Technical Specification for BIPV with Crystalline Silicon Modules on Curved Metal Roofs.'

LONGi BIPV Solution for Curved Coal-Storage Sheds
Image credit: LONGi's BIPV solution for curved coal-storage sheds, cropped from original, © LONGi via BJX Guangfu
On the regulatory front, policy is steering the transition. Recently, Hubei Province issued new rules for distributed PV, requiring general industrial and commercial systems to self-consume at least 50% of annual generation and encouraging PV-plus-storage to raise self-consumption. Meanwhile, CHN Energy—China’s top PV builder in recent years—is shifting from scale to 'value optimization,' tightening return thresholds and prioritizing mega-bases in deserts, the Gobi and barren lands, as well as integrated hydro–wind–solar hubs.

Analysts note that with central ministries calling for a lawful clampdown on cut‑throat, below‑cost competition, the industry is moving from volume-driven expansion to quality-focused breakthroughs.

As capacity is rationalized, leaders with stronger technology, balance sheets and differentiated offerings are best placed to exit the downturn early and pull the solar sector into a new phase of high-quality growth.

Experts expect a healthier, more orderly competitive landscape as industry concentration rises and N‑type technologies gain share.