From nearly 100 billion to 25: The massive crash of Shein is revealed

The fast-fashion giant Shein is currently preparing for an initial public offering (IPO) in Hong Kong, but it may arrive with a price tag much lower than the one attached to it at its peak. According to a report by Reuters today (Monday), the company is expected to aim for a valuation of about 25 billion dollars, with another source pointing to a range of 25–28 billion dollars — compared to a valuation of 98.2 billion dollars at which it was estimated in a funding round in 2022.

Within just four years, one of the world's largest online fashion giants may see nearly three-quarters of its value wiped out — at least on paper. According to three sources who spoke with Reuters, Shein is expected to reach its planned IPO on the Hong Kong Stock Exchange at a valuation significantly lower than previous estimates. Two of the sources estimated that the valuation would be around 25 billion dollars, while a third source pointed to a range of 25–28 billion dollars, depending on the price range marketed to investors.

This is a sharp decline even compared to expectations from the beginning of the month. According to a previous Reuters report, Shein was then aiming for a valuation of 30–40 billion dollars. However, the largest gap is revealed when comparing the numbers to the company's peak: in a funding round held in 2022, Shein was valued at no less than 98.2 billion dollars. If the IPO does indeed take place at a valuation of 25 billion dollars, it represents a decrease of about 75% compared to that estimate.

Shein, founded in China in 2012 and famous for selling fashion items at extremely low prices, currently sells to customers in about 160 countries. According to another source with direct knowledge of the plans, the company intends to offer up to 8% of its shares in the IPO. If the valuation stands at 25 billion dollars, the size of the IPO could reach up to 2 billion dollars.

Behind the decline in value is, among other things, a significant slowdown in the growth rate. Shein's revenue grew by 41.1% in 2023 and by 20.7% in 2024, but in 2025 growth amounted to only 8% and revenue reached 41.8 billion dollars. At the beginning of 2026, the slowdown became even more acute: in the first quarter, revenue grew by only 1.1%, partly due to the impact of American tariffs and customs duties imposed since May of last year.

Financial data present a complex picture. In 2025, Shein recorded a net profit of 2.06 billion dollars. A valuation of 25 billion dollars means that investors are pricing it at 12 times this annual profit. However, in the first quarter of 2026, the company shifted to a loss of 99 million dollars after sales slowed down, and it also recorded fair value losses of 328 million dollars related to convertible shares.

Some investors who were exposed to presentations ahead of the IPO or examined the latest reports told Reuters that they are not convinced that the company will be able to return to the high growth rates that allowed it to reach a valuation of nearly 100 billion dollars.

The reason is not just Shein's own performance. The company operates in a business environment that has become more complex, as key markets increase oversight of trading platforms that sell cheap products manufactured in China. Added to this are higher trade costs and increasing competition.

The valuation at which Shein will be issued may have additional significance for the company's founders and investors who already hold shares in it. According to the IPO documents, if the valuation is lower than certain pre-agreed levels, Shein will be required to grant additional shares to some of the investors who entered the company before the IPO. This means that the low valuation may also change the distribution of holdings among shareholders.