Shein posts $99 million loss ahead of Hong Kong IPO

Fast-fashion e-commerce giant Shein has swung to a quarterly loss and reported sharply declining profits as it prepares for a highly anticipated initial public offering in Hong Kong, according to financial filings made public on Sunday, July 26, 2026. The company's draft prospectus reveals a net loss of $99 million for the first quarter of 2026, a stark reversal from the $395 million net income it recorded in the same period a year earlier.

The filings, which lay the groundwork for investor roadshows ahead of the listing, show a company under significant pressure from rising costs and regulatory changes in its key markets. A primary factor cited is the United States' removal of a long-standing import duty exemption, known as the de minimis rule, which took effect in May 2025. This rule had allowed packages valued under $800 to enter the U.S. duty-free. Shein stated that the policy change has had an adverse impact on sales and overall growth in its largest market, while also contributing to increased expenses. Products shipped from China to the U.S. now face tax rates ranging from 10% to 87.5%.

The first-quarter loss was also amplified by a one-time, non-cash accounting charge of...