MMK profits plummet as Russia's economy falters

Russia's steel giant MMK reports a staggering profit drop amid economic turmoil.

Russia faces severe economic downturn as steel profits fall dramatically

Vladimir Putin confronts an escalating economic crisis, evidenced by the significant profit decline of Russia's largest steelmaker, MMK. In the first half of 2025, MMK's profits plummeted nearly 89% compared to the previous year, attributed to ongoing war and sanctions. Specifically, revenues decreased by 25% to 313.5 billion roubles, resulting from reduced sales and declining prices. The steelmaker's leadership warns that demand for metal products will likely remain low, compounded by soaring inflation and high interest rates, currently set at 20%. The broader Russian economy is struggling, with forecasts indicating further downturns across various industries, including a possible collapse of commercial airlines by 2027 due to heightened maintenance costs and fleet reductions.

The economic crisis in Russia appears to deepen as key industries like steel experience drastic downturns. The plummeting profits of MMK underscore the challenges that sanctions and internal economic policies pose. Furthermore, the potential collapse of the aviation sector raises alarms about job losses and broader economic repercussions. The high interest rates compound these problems, limiting investment and consumer spending. It seems that without a strategic pivot, Russia might face a prolonged recession, affecting millions.

Highlights

The future of Russia's economy hinges on critical policy changes and international relations.