Shein, the popular online fast-fashion retailer, faced a significant setback last year as its profit plummeted by over a third, according to a report by the Financial Times. The company’s net profit dropped by almost 40% to $1 billion in 2024, as disclosed by sources familiar with the matter.
Despite the decline in profit, Shein’s sales for the same period saw a 19% increase, reaching $38 billion. However, these figures fell short of the company’s internal projections for the year. Shein had initially projected a net profit of $4.8 billion and sales of $45 billion for 2024, as per a presentation seen by the Financial Times.
The news of Shein’s financial performance comes at a crucial time as the company gears up for a planned listing on the London Stock Exchange. Reuters recently reported that Shein was considering slashing its valuation for the IPO by nearly a quarter, valuing the company at around $50 billion. Bloomberg also suggested that Shein might face pressure to reduce its valuation even further, potentially down to $30 billion.
In addition to financial challenges, Shein’s London listing could face delays due to recent developments in the United States. Following President Donald Trump’s decision to end a tax exemption enjoyed by Shein, the company may see a dent in profitability and a potential increase in prices for its US customers. As a result, the planned IPO in London might be postponed to the second half of the year, according to reports by the Financial Times.
Shein has yet to comment on the reports regarding its financial performance and the impact on its IPO plans. The company’s future trajectory will likely depend on its ability to navigate these challenges and regain investor confidence in the lead-up to its listing on the London Stock Exchange.
