Abstract: Information technology capability is widely regarded by the academic circles and business circles as a vital means to reduce the operating cost and improve earning capacity. This paper applies the method of paired sample in the control group and collects the data of 248 listed companies during 2007-2012 to conduct an empirical test of the continuous influence of the information technology capability during the economic downturn period, as well as the impact of environment uncertainty on the relationship between information technology capability and financial performance. The results show that companies with superior information technology capability have better average profit rates in the current year and the subsequent two years, suggesting that information technology capability can make a sustainable improvement on the profitability even during the period of economic downturn. The findings also show that for those companies competing in the uncertain environment, information technology capability plays a greater role in lowering the business cost, and this impact is also sustainable. This study verifies that information technology capability has a sustainable impact on the corporate financial performance in the context of China’s economic transition and that the environmental uncertainty has a moderating effect on the relationship between information technology capability and financial performance, which provides Chinese companies with theoretical guidance for enhancing their ability to recover from losses during the period of economic downturn.

Key words: information technology capability; economic downturn; financial performance; environmental uncertainty; paired sample in the control group