Shein Swings to $99 Million Loss as Trump Tariffs Hit Sales

Shein says it swung to a quarterly loss as its sales slowed after US President Donald Trump removed an import duty exemption on small packages.

The move comes amid uncertainty over the paused US‑China tariff war. The fast‑fashion company, headquartered in Singapore, reported a $99 million (£74.1 million) loss for the first quarter of 2026, a sharp fall from a $395 million net income a year earlier.

In its filing, Shein indicated it was exploring options such as raising U.S. prices to offset increased import duties. It also warned that overseas conflicts had hit demand and logistics, further squeezing margins.

The quarter’s loss includes a paper hit of $328 million caused by an accounting change for special investor shares, a mechanism that can alter a company’s valuation before a listing.

The firm serves 281 million active customers globally—up 16% year‑on‑year—who placed over one billion orders in the same period. On 10 July, the China Securities Regulatory Commission approved Shein’s Hong Kong share sale after earlier attempts to list in New York and London were rejected.

The filing highlighted the impact of a Trump executive order that ended a global tariff exemption for goods valued up to $800. U.S. consumers had relied on that exemption to buy inexpensive items from sites like Shein and Temu, and the change is said to have negatively affected sales and overall revenue growth.

Earlier in July, the European Union imposed a €3 (≈$3.42) levy on low‑value e‑commerce imports, a move aimed at curbing what it called unfair competition from Chinese suppliers.

While the Hong Kong IPO is still under preparation, it is expected to launch in the coming months, offering a potential path for investors amid a challenging trade landscape.