Shein is seeking a valuation of $40 billion to $50 billion in a Hong Kong initial public offering after its prospectus showed 2025 net income fell 38.7% to $2.06 billion. Revenue rose about 8% to roughly $41.8 billion, and the operating margin narrowed to 2.9%. The request has a number. The market does not yet have a price. [1]

The annual figures advance Sunday's account of Shein's $99 million first-quarter loss. That filing opened the books while reserving the exchange hearing, offer size, price, allocation, listing, and return. Monday's analysis adds a fuller operating history. It does not complete any of those later stages.

Reuters reported that the sought range sits below Shein's $64 billion valuation in a 2024 funding round and far below the $98.2 billion recorded after a 2022 round. [1] Those private valuations are reference points, not prices available to public investors under current conditions.

The prospectus changes the question

The filing makes it harder to discuss Shein as a pure ceremony of listing momentum. Investors can now inspect slower growth, lower profit, a narrow margin, tariff pressure, and a first-quarter loss. They can compare those receipts with the valuation request rather than guessing from regulatory progress alone.

Reuters' filing account put 2025 revenue at $41.9 billion and showed growth shifting away from the United States. U.S. revenue contributed 24.1% of the total in 2025, down from 29.4% in 2023, while Europe and other markets grew in share. [2] Rounding differences between Reuters accounts should remain attached to their presentations rather than turned into a false contradiction.

First-quarter U.S. revenue fell 14% to $2 billion, while total quarterly revenue rose only 1.1% to about $9 billion. Operating profit fell 26% to $258 million, and the quarterly operating margin declined from 3.9% to 2.9%. [2] Those figures expose operating pressure more directly than the net loss alone.

The $99 million quarterly loss included a $328 million noncash fair-value change on convertible redeemable preferred shares. [1] [2] That accounting effect matters, but subtracting it mechanically would not create an audited alternative profit. The operating decline and thin margin remain visible without pretending the net figure is simple.

Tariffs have entered the books

Shein said removal of the U.S. de minimis exemption hurt sales growth and increased expenses. It was considering options including higher U.S. prices. The company also warned that European import fees could create effects in line with or greater than those seen in the United States. [1]

That establishes exposure and management's account of pressure. It does not allocate every dollar of slower growth or lower profit to tariffs. Product mix, marketing, fulfillment, competition, pricing, and geography also move the operating result.

The regional shift is not merely defensive. Europe had become Shein's largest market by 2024, and revenue outside the United States and Europe also expanded. [2] A valuation analysis therefore needs to ask whether growth elsewhere compensates for weaker U.S. economics, at what acquisition and fulfillment cost, and with what cash flow.

Product sales still accounted for nearly 90% of 2025 revenue, while service revenue grew. Apparel's share declined as other goods expanded. [2] Those changes can diversify the business or introduce new complexity. The filed totals do not establish which categories produce durable margins.

Sought is not priced

The phrase seeks $50 billion can sound like an achieved valuation because the top of the range is concrete. It remains a negotiating and marketing objective. The draft prospectus did not disclose the IPO size or price range. [2] Investors have not completed bookbuilding, allocation, or first trading.

The exchange hearing is another separate stage. Filing a draft allows review. A completed hearing can permit the company to proceed. A final prospectus fixes the operative disclosure. Pricing sets the transaction. Allocation distributes shares. Listing creates a public market. Later returns show whether the price held.

No one of those verbs can be borrowed from another. A company may seek a range and price below it. It may revise terms, delay, or withdraw. Even a completed first trade would not settle long-term value, cash generation, governance, or supply-chain risk.

Reuters quoted analysts questioning whether Shein can regain the exceptional growth associated with its earlier years. [1] Their judgments frame investor scrutiny; they are not market-clearing bids. The eventual order book and price will provide the first public transaction evidence.

No verified X post was authorized for the commission. That means claims of vindication after failed listing attempts, or claims that the process proves regulatory capture, remain outside this article's evidence. The divergence exists between IPO momentum language and the operating receipts in the filing, not between invented online camps.

What a real valuation record requires

The next useful documents are the exchange decision, final prospectus, audited and versioned figures, offer size, share count, ownership, cornerstone commitments, proceeds, and use of funds. Investors also need cash flow, liabilities, supply-chain exposure, and governance sufficient to test the narrow margin.

Pricing will then supply numerator and denominator: the amount investors agree to pay and the shares or enterprise value to which it applies. Without those terms, $40 billion to $50 billion remains a sought range attached to a company whose disclosed economics have changed sharply since its prior private rounds.

The prospectus has therefore done something important. It replaced a sealed-company narrative with figures that can be challenged. Revenue grew. Profit fell 38.7%. Margin narrowed. The U.S. business weakened, and the first quarter produced a loss shaped partly by accounting. [1] [2]

Those facts may still support a large public offering. They do not themselves support its requested price. Shein has opened more of its books and named what it wants. Investors have not yet answered.

-- THEO KAPLAN, San Francisco