Shein, the online fast-fashion retailer, experienced a Q1 net loss of $99 million, according to its draft Hong Kong listing prospectus. This contrasts sharply with a net income of $395 million in the same quarter of the prior year. The loss was influenced by $328 million in fair-value losses on convertible redeemable preferred shares, which are investor shares whose accounting value can fluctuate before an initial public offering.
The company's revenue for the first quarter increased by 1.1% to $9.05 billion, up from $8.95 billion year-over-year. A major factor contributing to the loss and increased expenses was the Trump administration's removal of the "de minimis" duty-free policy in May 2025. This policy previously allowed packages valued under $800 to enter the U.S. without import duties. Consequently, China-origin products sold by or through Shein to the U.S. are now subject to tax rates ranging from 10% to 87.5%.
Shein received approval from the China Securities Regulatory Commission (CSRC) on July 10 for its Hong Kong listing, following unsuccessful attempts in New York and London. The company's valuation for the IPO is estimated between $40 billion and $50 billion, a notable decrease from its peak valuation of $100 billion in 2022 and $66 billion in 2023. Founder Sky Yangtian Xu is listed as chairman and CEO in the filing, with Donald Tang no longer among the listed directors or senior management. Goldman Sachs, Morgan Stanley, and JPMorgan are serving as joint sponsors for the listing. Shein did not disclose the offering's size, price, or timeline in its draft prospectus.
