Shein expects its net income to nearly double to $2 billion this year, even as new U.S. tariffs and regulatory uncertainty threaten its long-delayed IPO.
Shein Group Ltd. (PC:SHNQX) is forecasting $2 billion in net income for 2025, nearly double last year’s $1.1 billion profit. The Singapore-based fast-fashion retailer expects mid-teen percentage growth in sales, helped by price adjustments and tighter cost controls that offset lower traffic linked to U.S. trade policies.
The company told investors that stronger margins helped it weather the blow from President Donald Trump’s new import tariffs, which closed the “de minimis” loophole that had allowed Shein to ship low-cost packages to the U.S. without customs duties.
In the first quarter, Shein posted net income above $400 million on almost $10 billion in revenue, as U.S. consumers rushed to make purchases before the policy shift took effect.
Price Hikes and Spending Cuts Boost Shein’s Margins
Shein appears to have passed most of the tariff costs on to shoppers through modest price hikes while trimming marketing expenses. Analysts say reduced advertising competition in the U.S., particularly as rival Temu scaled back promotions over the summer, gave Shein room to protect its margins.
The stronger outlook also helps the company reassure investors ahead of its long-anticipated initial public offering, which has faced repeated delays amid political scrutiny. Still, some market observers say one-off factors, such as pre-tariff sales and inventory timing, may have temporarily inflated results.
Although headquartered in Singapore, Shein must still undergo review by China’s securities regulator, which oversees companies with significant operations linked to the mainland. Beijing’s approval process has slowed the timeline further.
The company’s valuation has also fallen sharply from its $100 billion peak. After a funding round in 2023 valued Shein at $66 billion, investors such as IDG Capital, Mubadala Investment Co., and HSG (Sequoia China) have reportedly pushed for more conservative pricing ahead of an IPO
Global Growth Isn’t Getting Any Easier for Shein
Shein is also facing mounting headwinds abroad. Several governments, including France, are considering or enacting restrictions on duty-free small parcels, a move that could raise costs and slow logistics.
Earlier this week, French regulators suspended Shein’s marketplace in response to consumer-protection complaints over prohibited product listings.
Even so, Shein continues to open new physical stores and expand its product range, betting that its global brand recognition can offset policy and regulatory challenges.
If the company can deliver on its profit target while navigating these risks, analysts say it may still revive investor appetite ahead of a long-awaited IPO in 2026.
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