Shein Group Ltd. swung to a net loss of $99 million in the first quarter of 2026, reversing a $395 million profit in the same period a year earlier, as the fast-fashion retailer filed a draft prospectus with the Hong Kong Stock Exchange on 26 July 2026 — marking the first public disclosure of its financial results. Revenue rose just 1.1% year-on-year to $9.05 billion in the quarter.
The filing attributed the loss to two factors: an adverse impact on US sales following the removal of the de minimis duty exemption, and a $328 million fair-value charge on convertible redeemable preferred shares. The de minimis rule had previously allowed packages worth less than $800 to enter the United States without import duties; the US government removed that exemption in May 2025. Shein said in the prospectus that China-origin products sold by it or through its marketplace and shipped to the US are now subject to tax rates ranging from 10% to 87.5%.
Reuters reported earlier in July 2026 that Shein was seeking a valuation of $40 billion to $50 billion in the offering, citing a source with knowledge of the matter — a figure the company has not confirmed. Bloomberg characterised the disclosed financials as adding pressure on the valuation Shein can command in one of the year's biggest initial public offerings. Goldman Sachs (GS), Morgan Stanley (MS) and JPMorgan Chase (JPM) are named as joint sponsors of the listing in the filing. The prospectus does not disclose the number of shares to be sold, the offer price, the listing timetable or the expected proceeds.
Shein said proceeds from the IPO would be used to improve technology, raise brand awareness, expand its global presence, promote corporate responsibility and for general corporate purposes. The filing listed founder Sky Yangtian Xu, who founded the company in 2012, as chairman and chief executive. Donald Tang, who had previously served as executive chairman, was not listed among the company's directors or senior management in the prospectus. Pre-IPO investors named in the filing include IDG, Sequoia Capital, HongShan, Tiger Global, Boyu, Brookfield and General Atlantic.
The Hong Kong listing follows failed attempts by Shein to list in New York and London. Shein received approval from the China Securities Regulatory Commission for its Hong Kong listing on 10 July 2026. The company also faces a broadening regulatory headwind in its other major markets: the European Union imposed a €3 fee on low-value e-commerce imports this month, a measure the EU said was intended to curb unfair competition from China. In 2025, products stored in Shein's Chinese central warehouses accounted for more than 90% of the company's net revenue, according to the prospectus.
Sources: Bloomberg, CNBC, Reuters