9.05 billion. Operating margin fell to 2.9 per cent from 3.9 per cent, and full-year 2025 net income dropped 38.7 per cent to US$2.06 billion, even as revenue grew 8 per cent to US$41.85 billion, a sharp deceleration from 20.7 per cent growth in 2024. Since Washington removed the de minimis exemption last year, Chinese-origin goods shipped to American customers have attracted duties ranging from 10 to 87.5 per cent. Shein raised prices to compensate, and demand responded exactly as economists predict: US revenue fell 14.3 per cent in the first quarter to US$2.04 billion. America, once nearly 30 per cent of the business, now contributes 22.5 per cent of quarterly revenue. What makes this filing more than a post-mortem on de minimis is the warning embedded in its risk disclosures. Europe accounted for roughly a third of 2025 revenue, and this month the European Union began levying a €3 handling fee on low-value parcels from outside the bloc, alongside the removal of its €150 customs duty exemption. Shein concedes in the prospectus that the impact in the EU could match or exceed that in the US. Read plainly, that is a company telling prospective investors that more than half its revenue base is under simultaneous regulatory assault.  The architecture problem Shein’s advantage was never simply cheap clothes but a supply chain purpose-built for cross-border small-parcel trade. Products stored in central warehouses in Mainland China accounted for more than 90 per cent of net revenue in 2025. Localising inventory in the US or Europe would blunt the tariff hit, but it would also break the rapid test-and-reorder loop that makes Shein Shein. The company is being pushed to choose between its cost base and its operating model. Its answer, on the evidence of the filing, is to become something else entirely. Shein is leaning into a third-party marketplace, shifting inventory risk onto merchants, and diversifying beyond clothing into a broader lifestyle assortment.  Growth, meanwhile, is being sourced from everywhere. The company now counts around 273 million active customers across some 160 markets, who made more than 1 billion orders in 2025. Whether Southeast Asia, Latin America and the Gulf can replace Western margins is the multi-billion-dollar question the prospectus cannot answer. The venue that will have it Why list now, into numbers like these? Partly because Hong Kong is the venue that will finally have it. After failed attempts in New York and London, Shein secured CSRC approval on 10 July. The Hong Kong document duly avoids any specific mention of Xinjiang, gesturing instead at generic reputational risk from “negative publicity”. Lerong Lu of King’s College London told Reuters the city offers Shein a workable compromise: access to global capital under the watch of Chinese regulators, with less political friction than New York or London. Meanwhile, Hong Kong is enjoying its strongest IPO run in five years with HK$210 billion raised across 87 listings in the first half of 2026, up 92 per cent year on year, and PwC forecasting HK$380 billion for the full year.  However, the reported valuation target of US$40 billion to US$50 billion is half the US$100 billion Shein commanded in 2022.  The four co-founders – Sky Xu, Molly Miao, Maggie Gu and Tony Ren – control 65 per cent of the Cayman-registered holding company and their Class A shares carry 10 times the voting power of ordinary shares. Xu added the chairman title after Donald Tang, long the company’s public face in Western capitals, departed the top table. Buyers of this IPO are backing the founders’ judgment with limited recourse, at precisely the moment that judgment faces its hardest test. Nevertheless, none of this makes Shein uninvestable. A business generating US$41.85 billion in revenue, over a billion orders a year and positive underlying earnings through a tariff shock of this scale is not fragile. But the prospectus makes explicit that the era in which customs loopholes subsidised Shein’s growth is over. Further reading: The last resort: Shein’s Hong Kong listings, explained.