Online fast-fashion giant Shein is facing significant financial setbacks as it prepares for a planned listing on the London Stock Exchange. The company’s profit for 2024 dropped by nearly 40%, falling to $1 billion, adding to its challenges in the lead-up to the IPO. Despite a 19% increase in sales to $38 billion, the company’s profit figures were much lower than initially projected, with a target of $4.8 billion in profit and $45 billion in sales for the year.
Shein’s performance has led to reports that the company is considering cutting its valuation for the London IPO, with estimates suggesting a drop of up to 25%, bringing the valuation to around $50 billion, and some sources indicating it could fall as low as $30 billion.
In addition, the planned listing may be delayed to the second half of the year due to recent political and regulatory challenges. U.S. President Donald Trump’s move to end a tax exemption enjoyed by Shein could hurt the company’s profitability, raising prices in the U.S. and potentially making it more difficult to maintain its previous growth trajectory.
As Shein prepares for its public debut, the company faces mounting pressures both in terms of financial performance and regulatory hurdles, which could impact its stock market debut in London.