Shein Reports Quarterly Loss as US Tariffs Weigh on Sales Ahead of Hong Kong Listing
Fast-fashion retailer Shein has posted a quarterly loss after higher US import tariffs and weaker demand affected its business, as the company prepares for a stock market listing in Hong Kong.
The Singapore-headquartered retailer, which was founded in China, reported a net loss of $99 million for the first quarter, compared with a $395 million profit recorded during the same period a year earlier.
The financial results were disclosed as part of regulatory filings for the company’s planned initial public offering (IPO) in Hong Kong. However, the filing did not specify the size, pricing or timetable for the share sale.
Shein attributed part of the downturn to changes in US trade policy after President Donald Trump removed the import duty exemption for low-value packages, significantly increasing costs for goods shipped into the United States.
The company said it is considering several measures to offset the impact, including raising prices for customers in the US market.
Shein also cited disruptions linked to the conflict involving Iran, saying the situation reduced consumer demand in some regions, increased operating costs and caused shipping delays.
The quarterly results were also affected by a non-cash accounting adjustment of $328 million related to special investor shares that can later be converted into ordinary shares before the company’s public listing.
Despite the loss, Shein continued to expand its customer base. As of the end of March 2026, the company reported 281 million active customers, representing an increase of more than 16% compared with a year earlier. Those customers placed more than one billion orders during the period.
Earlier this month, China’s securities regulator approved Shein’s proposed Hong Kong listing after previous attempts to float its shares in New York and London failed. The IPO is expected to take place in the coming months.
The company said the removal of the US “de minimis” exemption has had a significant impact on its American business. The policy previously allowed goods valued at $800 or less to enter the United States without import duties, benefiting online retailers such as Shein and Temu.
The exemption was expanded globally after an executive order signed by President Trump took effect in August 2025. The White House said the measure was intended to prevent abuse of the system and curb the smuggling of illicit synthetic opioids into the country.
Shein acknowledged that the policy change has slowed sales growth in the United States and weighed on its overall revenue performance.
The company is also facing additional challenges in Europe after the European Union introduced a €3 levy on low-value e-commerce imports earlier this month, a move aimed at addressing what EU officials describe as unfair competition from Chinese online retailers.
