Shein’s profits said to plunge 70% as Temu and Zara challenge its dominance

Slowing earnings growth is weighing on the company’s plan for a public market debut in London

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Shein reportedly saw sales and profits growth slow significantly in the first six months of 2024. Photo: Reuters

Ann Caoin Shanghai

Published: 7:30pm, 25 Oct 2024

Chinese-founded fast-fashion giant Shein saw profits plunge over 70 per cent in the first half of 2024 due to fierce competition from rivals such as PDD Holdings’ Temu, according to a report by The Information.

Revenue growth of the Singapore-registered company slowed to 23 per cent during the period, down from 40 per cent for the full year of 2023. Profits dipped below US$400 million, The Information reported, citing unnamed sources.

Those numbers mark a significant deceleration from last year, when the company more than doubled its profits to a record high of over US$2 billion, according to a Financial Times report in March.

Shein, a private business, does not disclose its financial data to the public. It did not immediately respond to a request for comment on Friday.

An advertisement for Shein in London, where the company is planning a public listing. Photo: Reuters

If confirmed, the slowing earnings growth adds further uncertainty to Shein’s initial public offering plan on top of regulatory obstacles. The company is preparing for a listing in London and has held talks with potential investors, after abandoning an earlier plan to go public in New York amid pushback from US lawmakers.