Cross-border fast-fashion giant SHEIN has finally reached a critical milestone in its long-awaited Hong Kong IPO journey. On 26 July, SHEIN International Holdings updated its post-hearing prospectus, marking the latest step in a listing process that has stretched over four years and multiple jurisdictions.
From USD 100B to USD 30B
SHEIN’s valuation trajectory tells the story of shifting investor sentiment. At its 2022 peak, the company was valued at roughly $100 billion, making it the world’s third-largest unicorn behind ByteDance and SpaceX. By 2023, that figure had already been cut to around $66 billion in a funding round. Now, investors are pressing for a valuation closer to $30 billion — partly as a pragmatic trade-off to finally get the deal across the line. As one SHEIN investor told Caijing magazine: “We’ve missed the IPO window. The market favours AI companies right now. A lower valuation is fine — we just want to list.”
The Financials
SHEIN’s revenue continues to grow but profitability is eroding. In 2025, the company reported $41.8 billion in revenue and $2.06 billion in net profit. Q1 2026 showed $9.05 billion in revenue (up ~1.1% YoY) but swung to a net loss of $99 million, compared with a $39.5 million profit in the same period last year. Net margin fell from 4.4% to negative 1.1%.
Over the 2023–2025 period, net profit declined from $2.79 billion to $2.06 billion — a drop of nearly 39% year-on-year in 2025 alone.
Geopolitical Headwinds
The external environment has turned hostile on multiple fronts. The US Trump administration ended the de minimis exemption for low-value parcels in 2025, undermining SHEIN’s low-cost shipping model into its most important market. The EU followed suit on 1 July 2026, scrapping its own €150 de minimis threshold and introducing transitional fixed duties of €3 per item category.
In France, the Senate passed an “anti-fast-fashion law” in June 2026 targeting SHEIN, Temu and AliExpress specifically — banning advertising for such platforms and imposing per-item import taxes of €2 to €10, while European rivals like Zara and H&M are exempt. SHEIN’s Paris pop-up inside the BHV department store was terminated in June following local retailer protests.
Fulfillment costs are rising in lockstep. Q1 2026 fulfilment expenses reached $4.32 billion, up 12.8% YoY, now consuming 47.7% of operating expenses versus 42.8% a year earlier. Across Europe, regulatory investigations and fines have accumulated to over €210 million.
Growth Stalling
Traffic and download data reinforce the pressure. Similarweb shows SHEIN’s global website traffic growth decelerating from above 60% in H2 2025 to single digits by June 2026. Apptopia reports app downloads falling by up to 30% YoY in several months of the trailing 12-month period. US revenue — SHEIN’s largest market — dropped ~14.2% in Q1 2026, with Bloomberg-compiled card spending data showing double-digit declines in most months through June.
What Comes Next
On 10 July, China’s CSRC issued the offshore listing approval: SHEIN may issue up to 3.416 billion ordinary shares on the Hong Kong Stock Exchange. Executive Chairman Donald Tang (formerly of Merrill Lynch and Bear Stearns) will step down to become senior adviser, while reclusive founder Chris Xu will personally lead the pre-IPO investor roadshow.
SHEIN has announced plans to invest over $10 billion in a smart supply-chain headquarters in Guangdong province, signalling continued commitment to its China-based operational backbone. But the core question for IPO investors remains whether a discounted valuation adequately prices in the structural headwinds — or whether further compression lies ahead.
Read the original report (Sohu IT / Caijing)
*Translated and adapted from Sohu IT (it.sohu.com).*