Shein’s adjusted net profit fell 67% to $228 million in the second quarter, its first results since listing in Hong Kong, because the Middle East conflict raised what it pays for jet fuel and air freight to fly cheap clothes to shoppers. Revenue rose 0.9% to $11.08 billion only because Latin America made up for declines in Shein’s two biggest markets, with Europe down 13.9% to $3.77 billion and the US down 6%. The European drop came as Shein raised prices and cut online ads ahead of the EU’s €3 per-category fee on low-value parcels, which started July 1 and will be joined by a €2 handling fee from November 1. CEO and Chair Yangtian Xu said Shein will move into higher-priced brands, including through acquisitions, to raise its average selling price and profitability.
