- Shein posted a quarterly loss of $99 million due to slowing sales after the U.S. removed an import duty exemption on small packages, along with a hefty one-time accounting charge.
- Shein filed its Hong Kong IPO prospectus revealing that its profits came under pressure after the U.S. scrapped duty-free treatment for low-value imports.
- Net income declined 38.7% to $2.064 billion in 2025 from $3.365 billion a year earlier, according to the draft prospectus.
- Shein's revenue rose to $41.8 billion in 2025, up from $38.7 billion in 2024 and $32.1 billion in 2023.
- Shein's U.S. revenue fell 14.3% to $2.04 billion in the first quarter from $2.38 billion a year earlier.
- The removal of the U.S. 'de minimis' duty-free exemption in May 2025 has hurt Shein's U.S. business, weighing on sales and overall growth while increasing operating expenses.
- Europe accounted for about one-third of Shein's revenues in 2025 and could also be affected this year by the EU duty.
Shein's recent IPO prospectus reveals significant financial challenges as the company grapples with a $99 million quarterly loss and a 38.7% decline in net income to $2.064 billion for 2025. The loss is attributed to the U.S. government's removal of the de minimis duty-free exemption in May 2025, which has adversely affected Shein's U.S. sales and overall growth.
The prospectus indicates that Shein's revenue rose to $41.8 billion in 2025, up from $38.7 billion in 2024, but this growth rate has slowed significantly from 20.7% in 2024 to 8% in 2025. The company reported a 14.3% drop in U.S. revenue to $2.04 billion in the first quarter compared to $2.38 billion a year earlier.4
In response to the increased duties, Shein is considering raising prices in the U.S. market to offset costs. The company noted that products shipped to the U.S. are now subject to tax rates ranging from 10% to 87.5%. Additionally, the European Union has imposed a €3 fee on low-value imports, which could further impact Shein's revenues, as Europe accounted for about one-third of its total revenue in 2025.7
Despite these challenges, Shein is seeking a valuation of $40 to $50 billion for its IPO, a significant decrease from the $100 billion valuation reported in 2022. The company aims to navigate these turbulent waters as it prepares for its Hong Kong listing, following previous unsuccessful attempts in New York and London.
“Shein's 2025 net income fell 38.7% to $2.064 billion from $3.365 billion, while revenue grew 8% to $41.8 billion, slowing from 20.7% growth in 2024. The company also swung to a $99 million quarterly loss in Q1 2026, partly due to a $328 million fair-value charge on convertible shares.”
