The Business of Fashion

Fast-fashion retailer Shein has reported a 67% drop in quarterly profit, hit by rising costs and a slump in sales across Europe. The company, which has built its business on ultra-cheap online apparel, is facing mounting pressure from regulatory scrutiny, trade rules and softer European consumer demand, raising questions about its growth model ahead of any potential listing.

An affordable fashion chain is closing 120 stores, citing 'negative pressure' on its customers, understood as financial strain on shoppers and the business. The announcement affects locations across the United States, though the company name and timeline are not detailed in the available reporting. The closures add to a wave of retail downsizing as budget-conscious consumers cut back on apparel spending.

Shein has reported its first results as a public company, revealing that profits fell by roughly two-thirds. The decline in the fast-fashion retailer's earnings is drawing attention to pressures on its business model, including scrutiny over tariffs, competition and its much-anticipated listing. Analysts and investors are weighing what the sharp drop means for the company's valuation and growth prospects going forward.