Shein, the fast-fashion giant headquartered in Singapore but founded in China, swung to a quarterly loss as its sales slowed after US President Donald Trump removed an import duty exemption on small packages. The company reported a $99 million loss in the first three months of the year, compared with a net income of $395 million a year earlier.

Tariff Uncertainty and Business Strategy

The loss comes amid ongoing uncertainty over the tit-for-tat US-China tariffs, which are currently paused. In response to increased duties and taxes, Shein said it is pursuing a range of options, including increasing prices in the US market to offset some of the rising costs.

The firm also cited the Iran war as a factor affecting demand, increasing costs, and causing delivery delays in some markets; the first-quarter figures also included a $328 million paper loss due to an accounting change for special investor shares. These shares can later be converted into ordinary stock, with their value potentially fluctuating before a listing.

Preparing for Hong Kong Listing

The announcement is part of the company’s preparations for its planned stock market debut in Hong Kong, However, the filing did not provide details on the size, timing, or pricing of the initial public offering (IPO).

On 10 July. The China Securities Regulatory Commission (CSRC) approved Shein for a Hong Kong share sale after failed attempts to list in New York and London; the Hong Kong listing is expected to take place in the coming months.

The filing also revealed that Shein had 281 million active customers in the year ending March 2026 — a 16% increase from a year earlier, who placed more than one billion orders.

Impact of Tariff Policy and Global Measures

The figures reflect the impact of a Trump-signed executive order ending a global tariff exemption for goods valued at $800 or less. The order. Which took effect on 29 August 2025, expanded an earlier action that targeted cheap products from China and Hong Kong to now cover the rest of the world.

Previously, the so-called de minimis exemption allowed low-cost goods to enter the US without tariffs, enabling platforms like Shein and Temu to offer affordable products, the White House stated the exemption was being used to “evade tariffs and funnel deadly synthetic opioids” to the US.

Earlier in July, the European Union also imposed a €3 levy on low-value e-commerce imports, a move aimed at curbing what the trading bloc has described as unfair competition from China.