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Shein’s U.S. business operations are under investigation by the Federal Trade Commission. The e-commerce company disclosed the investigation within a Sunday filing with the entity running the Hong Kong Stock Exchange, where Shein Global Holdings Limited intends to become a publicly traded company.
Shein did not outline specifics about the investigation and the FTC declined to comment on the matter. However, Shein disclosed that while a settlement with the FTC is possible, the company cannot predict the outcome of the investigation and warned of the potential for significant monetary payments.
Shein’s filing also provided a look at its financial performance. The company’s active customer base and its total orders grew steadily from 2023 through 2025.
The company, however, reported a net loss of about $99 million for the three months ending March 31 this year, marking a significant drop from its $395 million net income during the same period in 2025. Shein said this change was mainly attributable to fair value losses on its convertible redeemable preferred shares.
Meanwhile, its net revenues in the U.S. dropped year over year during the same timeframe, whereas net revenues grew across its other geographic regions.
Shein flagged that the removal of the U.S. de minimis exemption in 2025 had a negative effect on its U.S. sales and the “overall growth” of its net revenues. This also increased its fulfillment expenses as a percentage of net revenues, though the company has since observed signs of normalizing consumer purchase behavior in the country.
The global e-commerce company has also felt the impact of other changes in U.S. trade policy.
Fulfillment expense per order increased slightly year over year for the twelve months ending March 31, due to the “impact of evolving tariff and customs duty policies since 2025,” the filing noted.
Shein said it has been passing the majority of its additional tariff costs onto the consumer by increasing its prices in the U.S. market since May of 2025.