On September 29th, the stock price of Shein, a fast fashion company founded in mainland China, hit a new low since its IPO, dropping by approximately 35% from its issuance price on September 1st. The first financial report released after its listing showed a nearly 70% year-on-year decrease in adjusted net profit in the second quarter, with a decline in revenue from the European and American markets.
Shein’s stock price on September 29th fell by 14.3% at one point during the trading day, hitting a record low since its IPO, and eventually closing at 31.50 Hong Kong dollars, down by 10.71%.
Shein went public in Hong Kong on September 1st at an issuance price of 48.56 Hong Kong dollars per share. Based on the closing price on September 29th, the stock price has fallen by about 35% in less than a month since its IPO.
According to Reuters, Shein was valued at around 26 billion US dollars at the time of its IPO, but as of September 29th, its market capitalization had fallen to approximately 17 billion US dollars. The company’s valuation in 2022 had once approached 100 billion US dollars.
Founded in mainland China, Shein is currently headquartered in Singapore and primarily sells low-priced clothing and lifestyle products to overseas markets such as Europe and America through online platforms.
Shein’s mid-year report for 2026 showed that the revenue for the second quarter was 11.082 billion US dollars, with only a 0.9% year-on-year increase. The adjusted net profit decreased from 683 million US dollars in the same period last year to 228 million US dollars this year, marking a 66.6% decrease.
In the second quarter of this year, Shein’s warehousing, distribution, and other expenses increased by 18.1% year-on-year, reaching 5.587 billion US dollars, accounting for about half of the quarterly revenue. In the same period last year, these expenses accounted for approximately 43.1% of the revenue. Shein attributed the decrease in profit margin to the rise in oil prices and transportation costs.
Investment bank J.P. Morgan estimated that Shein’s profitability in the second quarter was more than 10% lower than the lower end of the range indicated in its prospectus.
Revenue from the European market for Shein decreased by 13.9% year-on-year in the second quarter, while revenue from the US market dropped by 6%.
Shein stated that in response to the upcoming new low-price parcel tariffs to be implemented by the European Union, the company raised prices on goods in Europe in advance and reduced online advertising, leading to a decrease in product sales. Changes in the proportion of third-party merchant business also affected the revenue amount.
Shein’s low-price sales model had previously benefited from tariff exemptions for small cross-border parcels to Europe and America. The US ended tax-free treatment for low-cost parcels from mainland China and Hong Kong in 2025, subsequently expanding the measures to other countries.
Starting from July 1st this year, the EU abolished the tariff exemption for low-value cross-border online purchases not exceeding 150 euros and temporarily imposed a tariff of 3 euros per item. Since the new regulations were not implemented until the end of the second quarter, Shein’s price increase in Europe during that quarter was considered a preemptive measure. Shein stated that the new EU regulations may have a greater impact.
Shein also faced intellectual property and consumer rights disputes in Europe and America. Reuters previously reported that the company was involved in several lawsuits in the US for alleged design and product infringements. In France, Shein was fined 40 million euros in 2025 for false discount issues and an additional total of 22.5 million euros in 2026 for order confirmations, returns, and product information issues.
Shein’s revenue growth rate has declined from 41.1% in 2023 to 20.7% in 2024 and further to 8% in 2025.