Shein revenue neared US$10 billion in first quarter before tariffs: sources

[HONG KONG] Shein Group’s net income rose to over US$400 million and revenue was almost US$10 billion in the first quarter as consumers snapped up the fast-fashion retailer’s products ahead of US tariffs, according to people familiar with the matter.

The performance helped lift Shein’s profit margin to about 5 per cent, the people said, asking not to be identified because the figures were disclosed confidentially.

Shein’s path towards an initial public offering has developed into a saga, with an initial plan to list in the US derailed as the company’s supply chain and labour practices were scrutinised. Shein also considered the UK before opting for Hong Kong, where it has confidentially filed a draft prospectus, Bloomberg News reported earlier in July.

The clothing retailer, which was founded in mainland China and is headquartered in Singapore, does not disclose its financial figures publicly and it is unclear how it fared in the April-to-June quarter, which kicked off with US President Donald Trump’s “Liberation Day” tariff announcements.

Shein did not reply to Bloomberg’s emailed request for comment.

The US government’s decision to remove a so-called de minimis rule has been a blow to Shein, as the policy had exempted low-value goods – such as the ones the company ships – from tax. But since the rule change on imports from China and Hong Kong only took effect in May, Shein likely benefited for a while as consumers stocked up on products beforehand.

Trump has now signed an executive order removing the de minimis rule for all countries from Aug 29 – not just goods coming from China. That means Shein’s efforts to diversify its supply base to places like Vietnam won’t help to sustain its model of sending small parcels directly to US consumers with no duties.

Shein still needs approval from Chinese regulators to proceed with a share sale in Hong Kong. The company was valued at US$66 billion in a funding round in 2023, but it is under pressure to cut its valuation to about half of that.

Citing people with knowledge of the matter, the Financial Times reported in February that Shein’s 2024 net profit fell by almost 40 per cent to US$1 billion, while sales totalled US$38 billion. BLOOMBERG