Beike's net profit last year was 5 billion yuan, mainly due to layoffs and salary reductions.

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Source: Daguang Business Review

After the real estate industry entered a period of deep adjustment, Beike’s performance has still been truly uplifting.

In 2025, when domestic real estate developers suffered widespread losses, although Beike’s year-over-year decline in net profit was also close to 27%, it still made a profit of RMB 2.991 billion, becoming the only remaining super “money-printing machine” in the real estate sector!

First, let’s state the conclusion: this RMB 3 billion net profit was mainly achieved by significantly cutting headcount and lowering costs by Beike, against the backdrop of intensified real estate industry adjustments, only a slight increase in revenue, and a decline in commission rates.

From the revenue side, Beike’s total revenue in 2025 was RMB 94.6 billion, up only 1.2% year over year. On the cost side, however, Beike’s total labor cost in 2025 decreased by 7.4%, saving RMB 3.1 billion!

In addition, last year Beike’s selling/marketing expenses fell by 5.8%, and general and administrative expenses also declined by 9.9%, with the operating expense ratio dropping by 1.4 percentage points.

Overall, it seems that Beike is reducing costs and boosting efficiency in every direction, but the truly decisive move is “cutting people.”

By the end of 2025, Beike’s total number of employees dropped from 135,072 at the end of the previous year to 119,245. Net reduction of employees during the year was 15,827, a decrease of more than 11.7%. Total labor cost spending decreased by RMB 3.1 billion. This is the key reason Beike was able to preserve its RMB 3 billion net profit.

Based on Beike’s publicly disclosed financial report data, the following chart was prepared (unit: RMB 100 million). Since Beike’s full 2025 financial report has not yet been released, the compensation data for Peng Yongdong and Dan Yigang are only estimates for now; the explanation will be provided below.

This table intuitively reflects the impact of labor costs on Beike’s net profit. As you can see: labor cost is Beike’s largest cost item and also a key variable affecting net profit.

Precisely because of this, from 2021 to now, Beike has generally been reducing its total labor costs, causing the share of labor cost within revenue to show an overall downward trend. But as of 2025, Beike’s labor cost still accounts for more than 40% of its total revenue.

Therefore, this is also the core reason why in recent years Beike has been exposed to “large-scale layoffs” almost every year: if the company wants higher net profit and to earn more, Beike must reduce headcount and cut salaries with even greater intensity and力度.

From 2021 to 2024, Beike’s total labor cost spending fell from RMB 48 billion to RMB 41.7 billion, a net reduction of RMB 6.3 billion. Correspondingly, net profit immediately swung from a loss of RMB 525 million to a net profit of RMB 4.078 billion—an effect that can be described as “visible results from cost cutting.”

But ironically, in reducing labor cost spending, Beike has clearly been playing a “double standard.”

From 2021 to 2024, although Beike’s total labor cost spending decreased by RMB 6.3 billion, the total compensation of the two core executives, Peng Yongdong and Dan Yigang, surged from RMB 15 million to RMB 700 million, and the share of executive compensation at Beike jumped from 0.03% in 2021 to 1.68% in 2024!

On one hand, Beike’s total labor cost is declining overall; on the other hand, the total compensation amount and share for Peng Yongdong and Dan Yigang are skyrocketing.

With this kind of one falling and the other rising, the gap is far too stark—this is also the fundamental reason why Beike executives led by Peng Yongdong have repeatedly gotten caught up in public opinion storms in recent years.

But why did Peng Yongdong and Dan Yigang’s compensation suddenly skyrocket after 2021?

In May 2021, Beike’s founder Zuo Hui unfortunately passed away. After Zuo Hui’s death, did executives such as Peng Yongdong and Dan Yigang completely let themselves run wild?

Worth mentioning is that a substantial portion of the compensation for executives such as Peng Yongdong was in the form of share-based payments.

According to financial report data disclosed, in 2025 Beike’s compensation paid via share-based payments was approximately RMB 1.9 billion, and in 2024 the compensation paid via share-based payments was RMB 2.726 billion.

Of the RMB 2.726 billion in the previous year, Peng Yongdong and Dan Yigang took about 25%—totaling RMB 681 million. In addition, RMB 19.48 million was paid in cash, so the two of them received total compensation of as much as RMB 700 million.

In 2025, if we refer to the combined share of 25% that the two took from the RMB 1.9 billion in share-based-payment compensation in 2024, and then add the cash payment portion, the combined compensation for Peng Yongdong and Dan Yigang may be about RMB 500 million. Of course, the exact numbers will only be known after Beike fully discloses its 2025 results.

There’s another point: Beike’s net profit of RMB 2.991 billion in 2025 did not exclude the RMB 1.9 billion compensation paid in the form of shares mentioned above.

If it were excluded, Beike’s net profit in 2025 would increase by another RMB 1.9 billion on top of the RMB 2.991 billion base. In that case, last year Beike’s net profit would rise to around RMB 4.9 billion. This figure is very close to Beike’s adjusted net profit of RMB 5.017 billion.

That means that after excluding these RMB 1.9 billion, the effect of Beike’s headcount reductions and salary cuts in 2025 is actually even more pronounced: the net profit is not RMB 3 billion, but more than RMB 5 billion.