US company profits in China dropped for the second straight year in 2012, but the country remains a vital market, according to a report by American Chamber of Commerce in Shanghai on Thursday.

The chamber said China ranked in the top-three investment destinations for 54 percent of US companies surveyed, although some may leave the market because of rising costs.

Of the 420 companies surveyed, 73 percent were profitable in 2012. This is down from 78 percent in 2011 and 79 percent from the year before.