Shein swings to $99m loss as Trump tariffs hit sales
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- Shein swung to a $99m loss in Q1, reversing $395m in net income a year earlier, and attributed the hit to Trump's removal of the US de minimis exemption that had let packages valued under $800 enter tariff-free
- Trump's executive order ending the global de minimis exemption took effect 29 August 2025, broadening an earlier China- and Hong Kong-specific action; the White House said the loophole was used to "evade tariffs and funnel deadly synthetic opioids"
- Shein said it is "pursuing a wide range of options" including raising US prices to offset tariff costs, and separately blamed the Iran war for softer demand, higher costs, and delivery delays in some markets
- The $99m loss partly reflected a separate $328m paper loss from an accounting change tied to special investor shares convertible into ordinary stock — a non-cash item distinct from the operating hit
- Shein still grew to 281 million active customers (up more than 16% year-on-year) with over one billion orders in the year to March 2026, despite the tariff-driven US sales slowdown
- China's securities regulator (CSRC) approved Shein's Hong Kong share sale on 10 July after earlier attempts to list in New York and London fell through; size, timing and pricing were not disclosed
- The European Union imposed a €3 levy on low-value e-commerce imports in July, targeting unfair competition from China — a parallel policy move that could compound Shein's cost pressure
Why it matters: The headline $99m loss is inflated by a separate $328m non-cash accounting charge on special investor shares, meaning Shein's underlying US operations absorbed roughly a several-hundred-million-dollar swing largely from losing duty-free access on cheap packages — a cost the company now plans to pass to US shoppers via price hikes ahead of its Hong Kong listing.
