Shares in fast-fashion giant Shein plunged more than 11 percent in Hong Kong on Tuesday after releasing disappointing financial results.

The company, which faces growing competition from low-cost e-commerce companies such as Temu and AliExpress, said that revenue grew just one percent on-year in the first six months of the year, while its operating profit halved.

By around lunch on Tuesday, Shein's share price had pared some of the losses but was still down 10.9 percent at HK$31.44.

Monday's results were Shein's first since its high-profile initial public offering this month, which put the company's valuation at around US$26.3 billion – well short of the nearly US$100 billion during private fundraising rounds in 2022.

Net revenue from Europe fell 13.9 percent to nearly US$3.8 billion for the second quarter, Shein reported.

The decrease "reflects a decline in sales volume as we raised prices and lowered online advertising spending" in anticipation of the removal of the customs duty exemption, the company said.

Another key market, the United States, saw revenue drop six percent in April-June, reflecting the impact of tariffs.

Since its first day of trading on the Hong Kong Stock Exchange in September, Shein's share price has fallen more than 35 percent. (AFP)


Edited by Aaron Tam