Shein sales in Europe fell 13.9 per cent. The retailer raised prices and cut ad spending

Shein sold goods worth $3.77bn in Europe in the second quarter of 2026. Shein sales in Europe were 13.9 per cent lower than a year earlier. The company reported the quarter on 28 September, four weeks after its Hong Kong listing.

Europe fell 13.9 per cent while the whole company grew 0.9 per cent

Group revenue reached $11.08bn, up 0.9 per cent. The United States brought in $2.5bn, down 6 per cent. Europe was the weakest market of the three. Net profit margin came in at 2.1 per cent against 6.2 per cent a year earlier, and first-half operating profit halved.

A €3 charge per product type landed on parcels on 1 July

Since 1 July the European Union has charged €3 on each distinct product type inside a small parcel sent from outside the bloc. A basket of four different items therefore carries €12 before anything else. Poland’s e-commerce chamber has since argued the fee should go further and rise to seven euros, because three did not change what people buy.

Shein raised prices and cut digital marketing spend

The company did three things around the charge. It raised European prices before and after 1 July. It spent less on digital advertising. It put more money into warehouses inside Europe. The sales figure is the result of all three at once, so the charge alone does not explain the whole drop.

Costs moved the other way. Fulfilment expenses rose 18.1 per cent, which Shein put down to oil prices and freight rates linked to tension in the Middle East.

Sky Xu says average prices will rise as brands move upmarket

Chief executive Sky Xu said the platform’s average selling price will rise as the mix moves towards brands at higher price points. He said Shein wants to buy more brands and become a collection covering several price levels. Rivals are moving too, and TikTok Shop sellers in eight EU markets can now sell into the UK. Shoppers, meanwhile, remain cautious about handing decisions over, with only 7 per cent of fashion buyers trusting AI to buy for them.

Two dates now matter. The third quarter is the first full period in which the €3 charge applied from day one, so the next report will separate the charge from the price rises that came before it. And the shares are still 27.3 per cent below the HK$48.56 they were sold at on 1 September, which is the number the market will read that report against.