Shein swings to $99m loss as Trump tariffs hit sales

Fast-fashion giant Shein, headquartered in Singapore and founded in China, has announced that it swung to a quarterly net loss of $99m (£74.1m) during the first three months of the year. This steep decline marks a sharp reversal from the net income of $395m recorded during the same period a year earlier. The company's sales momentum slowed down significantly after US President Donald Trump eliminated the import duty exemption previously applied to small-package shipments.

The regulatory filing noted that the first-quarter figures partially reflected a paper loss of $328m resulting from an accounting modification for special investor shares, which can later be converted into ordinary stock and whose valuations fluctuate ahead of a listing. Furthermore, the firm noted that ongoing uncertainties surrounding the paused US-China trade wars, alongside the war in Iran, have negatively impacted consumer demand, elevated operational expenses, and caused delivery delays across multiple international markets.

Stock photo for illustration only, not from the actual event

The financial impact stems from an executive order signed by Donald Trump that officially terminated the global tariff exemption heavily utilized by American shoppers purchasing low-cost merchandise. Taking effect on August 29, 2025, the order expanded an earlier presidential directive that specifically targeted inexpensive products originating from China and Hong Kong to encompass the rest of the world. The de minimis exemption previously allowed merchandise valued at $800 or less to enter the United States completely tariff-free, driving massive consumer reliance on e-commerce platforms like Shein and Temu. The White House stated that the global exemption was being exploited to evade tariffs and smuggle dangerous synthetic opioids into the country.