Shein Swings to Quarterly Loss as Trump Tariffs Hit Sales

Shein has swung to a quarterly loss, reporting $99 million in the red for the first three months of the year, a stark contrast to the $395 million net income recorded a year prior. This downturn follows a slowdown in sales, attributed in part to former US President Donald Trump's decision to end an import duty exemption on small packages. The move has directly impacted Shein's operational costs and pricing strategies.

The fast-fashion retailer, headquartered in Singapore but founded in China, is currently preparing for a stock market debut in Hong Kong. While the filing did not reveal specific details about the initial public offering's size or timeline, the company is actively seeking ways to mitigate the financial impact of increased duties and taxes. Shein indicated in its filing that it is considering raising prices in the US market to offset a portion of these additional expenses.

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In response to the increased duties and taxes, we are pursuing a wide range of options, including increasing our prices in the US market to offset a portion of the increased costs.

Adding to its challenges, Shein also cited the Iran war as a factor that has negatively affected demand, increased costs, and caused delivery delays in certain markets. The company's first-quarter results were also influenced by a $328 million paper loss stemming from an accounting change related to special investor shares. Despite these headwinds, Shein reported a significant increase in active customers, reaching 281 million in the year to March 2026, with over one billion orders placed.

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The removal of the US de minimis exemption has had an adverse impact on our sales in the US and the overall growth of our net revenues.