Cracks in Russia’s Economy: Over a Third of Companies Now Operating at a Loss.

Russia’s Economic Outlook

According to UATV: Russia’s economy continues to deteriorate, with more than one-third of its companies now running at a loss. Trouble is spreading across multiple sectors, especially food production and oil. The country’s budget deficit has reached roughly $100 billion, driven by the war against Ukraine and the impact of international sanctions.

Based on the latest survey data:

• 31% of surveyed companies reported losses,
• 36% indicated low profitability,
• 26% described their financial position as unstable.

The food industry is particularly hard hit: 94% of Russian food service establishments are operating at or near the break-even point, often with losses. As of January 1, 2026, Moscow alone has seen 45 restaurants close—clear evidence of severe strain in this sector.

Meanwhile, the supermarket chain Magnit ended 2025 with a loss of 22.5 billion rubles, while its debt load surged 74% to 164 billion rubles annually. These figures highlight the financial difficulties not only of individual businesses but of entire economic segments. Notably, 74 Russian regions finished the year with budget shortfalls, and the cumulative deficit has surpassed 15 trillion rubles.

“We don’t have many resources. To be precise, only one—and it’s tied to our national trait: in tough times, we know how to pull together and work harder.”

Oleg Deripaska

Given these circumstances, Russia’s economic situation remains tense, and the path forward will depend on many factors—including domestic policy choices and the broader international environment.

The current state of affairs underscores the serious economic challenges facing the country, largely stemming from sanctions and the consequences of military conflict. Worsening financial results and business closures point to an urgent need for strategic economic adaptation. How the government responds and how businesses adjust to these pressures will be critical in shaping any recovery amid ongoing global instability.