Shein reveals financials, valuation in Hong Kong IPO filings

• Europe overtook the U.S. as Shein's largest market in 2024, accounting for 35.4% of revenue ($14.8 billion) in 2025, while U.S. contribution fell from 29.4% in 2023 to 24.1% in 2025
• First quarter 2026 revenue grew just 1.1% year-over-year to $9 billion, with U.S. revenue declining 14% to $2 billion, reflecting the impact of eliminated duty exemptions
• Operating profit margin compressed to 2.9% in Q1 2026 from 3.9% a year earlier as marketing and fulfillment costs rose while sales stagnated, with operating profit falling 26% to $258 million

Shein Hong Kong IPO Filing Summary

Key Financial Performance:

Online fast-fashion retailer Shein filed for a Hong Kong IPO, revealing financials for the first time. The company reported a $99 million loss in Q1 2026, primarily due to a $328 million non-cash accounting charge related to convertible preferred shares.

Revenue grew from $32.1 billion (2023) to $41.9 billion (2025), representing a 14.2% compound annual growth rate. However, Q1 2026 revenue increased just 1.1% year-over-year to $9 billion, signaling significant deceleration.

Geographic Shift:

The U.S. market share declined sharply from 29.4% of revenue (2023) to 22.5% (Q1 2026) following the elimination of import duty exemptions on small packages. U.S. revenue fell 14% to $2 billion in Q1 2026.

Europe became Shein's largest market in 2024, growing from $10.2 billion (2023) to $14.8 billion (2025), representing 35.4% of total revenue. Rest of World markets expanded to 40.5% of revenue by 2025.

Profitability Pressure:

Operating profit dropped 26% in Q1 2026 to $258 million as marketing and fulfillment costs rose amid stagnant sales. Operating margin compressed to 2.9% from 3.9% year-over-year, with historical margins ranging from 2.5% to 4.3%.

Valuation:

Shein's valuation has declined substantially from $98.2 billion (2022) to $64 billion (2024). The company reportedly seeks a $40-50 billion valuation for its IPO, though specific pricing details were not disclosed in the filing.

Product Mix:

Product sales comprise nearly 90% of revenue, with apparel's contribution declining from 68.8% to 63.8% between 2023-2025 as diversification accelerates.