Reading made a £40.6m operating loss in the 2018-19 financial year as player wages increased by more than £5m, the club's accounts have revealed.
Those losses were reduced from more then £45m after the club sold their training ground and received income from management charges and loan fees.
The Royals also spent £1.5m in rent on their Madejski Stadium ground.
Reading sold the ground for £26.5m to a holding company controlled by owner Dai Yongge in the previous financial year.
They remain under investigation by the English Football League for the valuation placed on the stadium. Fellow Championship clubs Derby County and Sheffield Wednesday have also faced similar scrutiny.
The full figures for the year ending June 2019, published through Companies House, also showed the Royals spent £225 for every £100 of income on player wages as their wage bill increased by £5.4m from the previous financial year.
The latest accounts do not include the high-profile purchases of strikers George Puscas and Lucas Joao in August.
“The owners do seem incredibly generous and willing to invest,” football finance expert Kieran Maguire, form the University of Liverpool, told BBC Radio Berkshire.
“But they have exhausted the options available to the club to reduce costs. To stay within Profitability and Sustainability regulations, they will need to start to address that issue.
“Clearly the biggest of those is going to be player wages.”