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Tadawul-listed companies excluding Saudi Aramco reported a 63% year-on-year decline in Q4 2025 net profits to SAR 16.4 billion. The sharp drop was driven by losses in the petrochemicals sector, weaker performances in energy and food production industries, and impairment charges recorded in financial results. This marks a significant reversal from previous quarters, with the petrochemicals segment facing margin pressures from global commodity price fluctuations and domestic demand shifts.
The decline raises concerns for Saudi equity markets, particularly for investors holding exposure to energy-linked stocks. With the Tadawul All Share Index (TASI) already showing volatility, the earnings slump could exacerbate near-term weakness. Traders may need to reassess valuations in the energy and industrial sectors, while monitoring for potential policy responses from Saudi authorities to stabilize key industries.
For Gulf investors, the results highlight sectoral vulnerabilities in the post-oil transition. The petrochemicals sector's struggles underscore the need for diversification strategies. Market participants should watch for Q1 2026 guidance updates from major firms and potential government stimulus measures targeting energy-intensive industries.
