Fast-fashion retailer Shein's first earnings report since its September IPO disappointed investors, sending its Hong Kong-listed stock down about 14% to a record low. The China-founded company reported second-quarter revenue of $11.08 billion, a modest 0.9% increase from a year earlier, while adjusted net income fell by two-thirds to $228.0 million. Analysts at Jefferies noted results landed more than 10% below the low end of the range implied by the prospectus. U.S. revenue dropped 6.0% and Europe revenue slid 14%, with the downturn attributed to the elimination of tariff exemptions for low-value goods imports by the U.S. government in 2025 and the European Union in July.

The ongoing conflict in the Middle East has also disrupted shipping and driven up freight costs. Shein expects the external environment to remain uncertain in the second half of 2026, though it anticipates a stronger final quarter. In response to the headwinds, Shein is pursuing measures including raising product prices.

The stock has fallen nearly 30% from its IPO price, with the company now trading at roughly a quarter of its former $100 billion valuation.