Shares of fast-fashion platform Shein fall 6% after quarterly profit slides 67%
On September 29, shares of fast-fashion retailer Shein plummeted more than 6 percent following a 67 percent decline in quarterly profit, sparking investor concerns about margin pressure and slowing growth. Analysts from Jefferies estimated earnings fell over 10 percent below the conservative range projected in Shein's prospectus.
Adjusted net profit for the second quarter was $228 million, with margins contracting to just 2.1 percent from 6.2 percent the previous year. This sharp drop in margins was attributed to the Middle East conflict driving up jet fuel and freight costs for Shein, which ships affordable garments by air to customers worldwide. Since its debut on the Hong Kong stock market on September 1, Shein's shares have declined 27.3 percent from the offering price of HK$48.56 ($6.19).
On Monday, Shein CEO and Chair Yangtian Xu emphasized the priority of expanding inventory in Europe and venturing into higher-priced clothing to boost profitability.
Written by urgent.news from Channel News Asia's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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