At the start of 2024, Shein was earning nearly $400m in a single quarter. By the first three months of 2025, it was losing money. The Singapore-headquartered company — founded in China and now seeking a stock market debut in Hong Kong — reported a net loss of $99m for Q1 2025, against a net income of $395m in the same period a year earlier. That reversal, equivalent to nearly half a billion dollars in swing, is being attributed in large part to a single stroke of an executive pen in Washington.

The instrument in question is a US presidential order that dismantled the so-called de minimis exemption, a rule that had allowed goods valued at $800 or less to enter the United States without attracting any import duties. An earlier version of the order had already targeted cheap products from China and Hong Kong specifically; on 29 August 2025, it was extended to cover the rest of the world. For a business model built on shipping individual low-cost garments directly from Chinese factories to American consumers, the consequences were immediate. "The removal of the US de minimis exemption has had an adverse impact on our sales in the US and the overall growth of our net revenues," Shein stated in its IPO filing with Hong Kong regulators.

The company added that it is raising prices in the United States to offset some of the additional costs. The filing, submitted as part of preparations for a Hong Kong listing approved by the China Securities Regulatory Commission on 10 July, also disclosed that Shein counted 281 million active customers in the year to March 2026 — a rise of more than 16% — who collectively placed over one billion orders. Those figures suggest demand remains structurally robust even as margins are being compressed by trade policy.