US Firms in China See Rebound in Optimism and Profits, AmCham Survey Finds

U.S. companies operating in China are expressing a significant rebound in optimism, driven by improved profitability and a perceived stabilization in U.S.-China relations, according to a new survey. The annual report from the American Chamber of Commerce in Shanghai (AmCham Shanghai) shows sentiment recovering sharply from a record low recorded last year.

Key Survey Findings

The chamber's annual China Business Report, which surveyed 262 companies, found a marked improvement in both sentiment and financial performance. This year's findings end a four-year period of historically low confidence among U.S. businesses in the country.

Key metrics from the report include:

• 58% of respondents are now optimistic about their five-year business outlook, a 17-percentage-point increase from the previous year.
• Profitability has strengthened, with 78% of firms reporting their China operations were profitable last year, the highest level recorded since 2019.
• Investment plans are also firming up, with 31% of companies planning to increase investment in 2026, compared to only 14% that expect to reduce it.

A Shift in Business Challenges

While geopolitical tensions remain a factor, the survey indicates a shift in the primary concerns for U.S. firms. Intense domestic competition has now overtaken U.S.-China relations as the top challenge, cited by 68% of respondents.

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Views on the regulatory environment were mixed. While a majority of companies (55%) now view China's regulatory landscape as transparent, a 7-percentage-point increase, the proportion expecting the environment to become more open in the future fell slightly to 39%.

Political Thaw Boosts Confidence

AmCham Shanghai attributes the significant "mood shift" to diplomatic efforts to stabilize the relationship between Washington and Beijing. Last year's survey was conducted amid escalating trade disputes, whereas the latest data follows a trade truce and a successful leadership summit.

"After the leadership of the two countries agreed that they were going to be working on a constructive relationship... that was very reassuring to all of our members," said Jeffrey Lehman, chairman of AmCham Shanghai. He noted this reassurance "really drives so many of the positive results" seen in the survey.

For investors, this revival in business confidence suggests that U.S. companies with significant China operations may see a more stable operating environment, though navigating fierce local competition remains a critical challenge.