Shein has swung to a quarterly loss of $99m (£74.1m) as the fast-fashion giant grapples with the removal of a US import duty exemption and disruption from the Iran war. The figure compares with a net income of $395m a year earlier, with the loss partly reflecting a paper loss of $328m due to an accounting change for special investor shares.
The announcement comes as Shein prepares for its stock market debut in Hong Kong, after receiving approval from the China Securities Regulatory Commission on 10 July. The filing did not give details on the size, timetable or pricing of the planned IPO, which is expected in the coming months.
“Shein swings to $99m loss after US tariff exemption removal and Iran war disruption hit sales.”
The removal of the US de minimis exemption, which allowed goods valued at $800 or less to enter without tariffs, has had an adverse impact on sales, Shein said. The exemption was ended by a Trump executive order on 29 August 2025, initially targeting China but later expanded globally. The White House said the exemption was being used to "evade tariffs and funnel deadly synthetic opioids" to the US.
"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," Shein said in the filing. "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."
The company also said the Iran war had hit demand, increased costs and caused delays of deliveries in some markets. Despite the challenges, Shein reported 281 million active customers in the year to the end of March 2026, a rise of more than 16%, with over one billion orders placed.
Earlier in July, the European Union imposed a €3 levy on low-value e-commerce imports, aimed at curbing what the trading bloc said was unfair competition from China. The dual pressures from US and EU trade measures, combined with geopolitical instability, leave Shein navigating a turbulent path ahead of its Hong Kong listing.