Shein reports a $99 million quarterly loss as the administration ends the de minimis import duty exemption
Shein reported a $99 million loss in the first quarter of 2026, a significant decline from the $395 million profit recorded in the same period a year prior. The company's financial filings, released ahead of its upcoming Hong Kong initial public offering, attribute this decline to the administration's decision to end the de minimis exemption. This trade loophole previously allowed goods valued at $800 or less to enter the United States without tariffs, but the administration announced that the removal of this exemption has had an adverse impact on sales in the company's largest market. Under the new policy, Chinese-origin products sold by Shein are now subject to tax rates ranging from 10% to 87.5%. To offset these increased costs, Shein plans to increase prices in the U.S. market. The company also noted that a $328 million accounting charge for special investor shares contributed to the quarterly loss. Despite these challenges, Shein maintains a 281 million active customers and is preparing for its stock market debut in Hong Kong after failed attempts to list in New York and London.