Shein warns of Trump tariff impact in IPO filing
Higher duties could push U.S. prices higher
By: James Powel
USA Today
.... Fast-fashion retailer Shein blamed Trump administration trade polices with China for a loss in the first quarter of 2026 as the purveyor of ultra-cheap clothing prepares to go public.
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Documents filed in seeking a $40 billion to $50 billion valuation through an initial public offering with the Stock Exchange of Hong Kong showed the company taking $99 million loss in the first quarter of 2026.
..... The company made a profit of $395 million in the first quarter of 2025, according to the documents.
..... founded in Nanjing, China, and headquartered in Singapore, Shein has found itself at the center of trade tensions between the United States and China.
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Trump ended the "de minimis" exemption, a trade loophole for low-cost imported goods, for imports from China in May 2025.
..... Shein said the move has adversely affected sales in its largest market.
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Winston Ma, executive director of the Global Public Investment funds Forum and a former managing director at the China Investment Corporation, told Reuters that Hong Kong's institutional investors will "zero in on the 2.9% operating margin" and "re-price Shein away from a pure hyper-growth tech platform toward a physical retail and logistics player navigating high-friction global trade."
..... It's narrowing margin adds to concerns that Sheirn's rapid rise in encountering headwinds from higher trade costs, increased regulatory scrutiny and intensifying competition in global e-commerce.
..... The company's U.S. revenue fell 14.3% to $2.04 billion in the first quarter from $2.38 billion a year earlier. [2025]
the United States accounted for 22.5% of quarterly revenue, down from 29.4% of annual revenue in 2023.
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Shein said Chinese-origin products sold directly form the company or through its marketplace and shipped to the United States are now subject to tax rates ranging form 10% to 87.5%.
..... Before the Trump administration's actions, those products were taxed 10% to 62.5%, according to the company
..... In response to the increased duties and taxes, we are pursuing a wide range of options, including increasing our prices in the U.S. market to offset a portion of the increased costs." Shein said. "We expect to pass on the majority of the increased costs under our cost-plus pricing strategy."
..... Shein has faced criticism from rivals, regulators and advocacy groups over issue including working conditions in supplier factories, allegedly addictive features of tis shopping app, and the environmental impact of shipping large volumes by air.
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Shein has said it has a zero-tolerance policy on labor abuses and has invested in risk assessments and mitigation framework to safeguard users.
..... Contributing: Reuters