Performance Losses Mount, Internal and External Challenges Compound: Can Meckor Home Furniture Break Out Through Diversification?

First, due to its own debt disputes, the controlling shareholder’s shares in the company were fully frozen. Subsequently, a lawsuit was filed because the company’s guarantee for the controlling shareholder’s external obligations was overdue. Recently, Meike Home Furnishings has attracted continuous attention.

In terms of performance, Meike Home Furnishings has reported losses for three consecutive years from 2022 to 2024, with the 2025 earnings forecast showing an even larger loss. Debt risks continue to rise, as the third quarter of 2025 shows the company’s cash holdings far below short-term loans, leading to overdue bank loans and lawsuits. Operational crises are frequent; in 2024, 27 stores were closed. In January 2026, two major factories in Tianjin completely shut down, and the company was also involved in a wage arrears controversy.

Under heavy pressure, Meike Home Furnishings has chosen to diversify into the optoelectronics field to boost revenue. Industry insiders believe this move is not impossible, but the “time lag” risk is very high. The main furniture business has not yet recovered, and a new sector requiring ongoing R&D investment has been added, which could easily cause losses on both ends and distract resources.

On March 12, regarding issues such as overdue debt, losses, and diversification into optoelectronics, Beijing News reporters contacted Meike Home Furnishings via email. As of press time, no reply has been received.

Repeated Borrowing Disputes and Guarantee Overdue

On March 5, Meike Home Furnishings announced that all 488 million shares held by its controlling shareholder, Meike Investment Group Co., Ltd., were fully frozen, accounting for 33.99% of the company’s total share capital and 100% of Meike Group’s holdings. The freeze began on March 4, 2026, enforced by the Wuxi Intermediate People’s Court in Jiangsu Province.

The trigger for this freeze was a debt restructuring dispute. The announcement states that the freeze resulted from a borrowing dispute between the company and Jiangsu Asset Management Co., Ltd. (“Jiangsu Asset”). In September 2024, the company and Jiangsu Asset engaged in a debt restructuring through a loan agreement, transferring their claims on the listed company via a “Debt Transfer Contract.” The full subsidiaries of Meike—Meike Digital Creation (Ganzhou) Home Furniture Intelligent Manufacturing Co., Ltd., Meike International Furniture (Tianjin) Manufacturing Co., Ltd., and Meike International Furniture Processing (Tianjin) Co., Ltd.—signed the contract to transfer their debt claims to Jiangsu Asset. Meike Group provided guarantees for this loan. In September 2025, both parties agreed to extend the loan for one year, until September 2026. Recently, the company failed to make the scheduled debt restructuring payments to Jiangsu Asset, which filed a lawsuit and requested property preservation. According to a notice from the Wuxi Intermediate People’s Court, all shares of Meike Home Furnishings held by Meike Group have been fully frozen. The dispute involves a claim of 117 million yuan.

Subsequently, Meike Home Furnishings was sued again for overdue guarantees provided to its controlling shareholder. On March 6, the company announced that it had guaranteed a total of 100 million yuan in financing for Meike Group with Industrial Bank, of which 51 million yuan had been disclosed earlier. To date, Meike Group has failed to repay the loans on time, and the guarantee provided by Meike Home Furnishings has expired. Industrial Bank has already accelerated the remaining 49 million yuan and filed a lawsuit demanding that Meike Home Furnishings fulfill its guarantee obligations. The announcement also states that Meike Home Furnishings has overdue guarantees for six loans to the controlling shareholder, totaling 337 million yuan.

The company warned that these overdue guarantees could lead to lawsuits and joint guarantee liabilities, potentially increasing financial costs and worsening liquidity issues.

Continuous Losses and Debt Burdens

Beijing News reporters reviewed Meike Home Furnishings’ annual reports and noted that its losses have been expanding in recent years. Since the first loss in 2022, the company’s performance has been “out of control,” with cumulative losses exceeding 1.8 billion yuan by the third quarter of 2025.

Specifically, from 2022 to 2024, revenue was 4.496 billion, 4.182 billion, and 3.395 billion yuan respectively, with year-over-year declines of 14.78%, 6.98%, and 18.83%. Net profits attributable to shareholders were -289 million, -463 million, and -864 million yuan. For 2025, net losses are forecasted to be between 1.2 billion and 1.8 billion yuan, with losses further widening.

Financial data shows that as of the end of the third quarter of 2025, the company’s cash balance was 116 million yuan, while short-term borrowings reached 946 million yuan, with a coverage ratio of only 12%. This indicates significant short-term repayment pressure. According to public reports, by the end of January 2026, Meike Home Furnishings had overdue loans guaranteed for Meike Group totaling 287.6 million yuan, including a 150 million yuan overdue loan from the Xinjiang branch of China Export & Import Bank, which has already been sued. The bank demands repayment from Meike Group and seeks reimbursement from the guarantee, Meike Home Furnishings. The other three overdue loans are being negotiated for extension, but the company still faces risks of joint liability.

On March 10, Meike Home Furnishings announced that it had accumulated 165 lawsuits and arbitrations over the past 12 months, involving 460 million yuan, accounting for 16.76% of its latest audited net assets. These disputes include construction contract disputes, financial loan disputes, leasing disputes, and housing rental disputes.

Public reports also indicate that in January, the company faced a wage arrears crisis. It once proposed using furniture as salary payment, asking employees to sell furniture to offset overdue wages, which sparked collective protests and exposed the company’s strained cash flow. On March 12, Beijing News reporters noticed on multiple social platforms that former employees of Meike Home Furnishings still reported unpaid wages.

Faced with mounting pressure, the company has had to adopt drastic measures. In January, it shut down two wholly owned subsidiaries in Tianjin. The company stated that this was to optimize idle capacity, reduce losses, and accelerate strategic transformation.

The reporters also observed that the number of physical stores continued to shrink. Financial reports show that in 2024, 27 stores were closed, and in the first half of 2025, four underperforming stores were shut down. Public information indicates that in February 2025, the Beijing Meike Meijia (North Fourth Ring) store closed, which was among the top ten stores by revenue in 2024.

Can Diversification into Optoelectronics Break the Deadlock?

In December 2025, Meike Home Furnishings announced a plan to issue shares and pay cash to acquire assets and raise supporting funds. The plan involves acquiring 100% of Shenzhen Wandezhao Optoelectronic Technology Co., Ltd. (“Wandezhao”), marking a formal entry into the high-speed interconnected and optoelectronic technology sector from the high-end furniture field.

The company states that Wandezhao operates in a different industry from its main business, and there are risks associated with integration. After the transaction, Wandezhao will become a controlling subsidiary, and the two companies will need to further integrate in terms of business systems, organizational structure, and management. If integration does not meet expectations, it could adversely affect Wandezhao’s operations and harm the interests of the listed company and shareholders. The announcement also mentions that after the transaction, the company’s total assets and revenue are expected to grow further, strengthening its ongoing operational capacity.

As of now, the audit and valuation work related to this transaction has not been completed, and the valuation and transaction price are yet to be determined.

Industry insiders suggest that for Meike Home Furnishings, the challenge is not whether it can “cross over,” but rather the “time lag” risk. Its core furniture business has not yet recovered, and adding a new sector requiring continuous R&D investment could cause losses on both ends. Some also believe that the company lacks operational experience in AI and high-tech fields, and the effectiveness of integration, profitability, and market competitiveness of the target company will take time to verify. The success rate of the transformation remains uncertain.

Beijing News Reporter Zhang Jie

Editor Wang Lin

Proofreader Yang Xuli