Shein and Temu Experience Declining U.S. Demand as Cheap Goods Loophole Tightens

The usage of low-cost e-commerce platforms Temu and Shein is witnessing a notable decline in the U.S. market. This downturn comes in light of tariffs imposed on Chinese imports by former President Donald Trump and the closure of the de minimis loophole.

Recent data indicates that Temu’s daily active users (DAUs) in the U.S. plummeted by 52% in May compared to March, while Shein saw a 25% decrease in the same period, according to market research firm Sensor Tower. DAUs represent the number of individuals engaging with a platform within a 24-hour period.

The monthly active users (MAUs) figure also indicated a downward trend, with Temu’s MAUs decreasing by 30% and Shein’s by 12% in May compared to March. These declines reflect a significant reduction in both platforms’ rankings on the Apple App Store, with Temu’s average rank dropping to 132 in May 2025 from a previous top 3 position, and Shein falling to an average rank of 60 from the top 10 over the past year.

This decrease in user activity aligns with a reduction in advertising spend by both companies in the U.S. Following Trump’s tariff announcement in April, Temu’s ad spend fell by 95% year-on-year, while Shein’s dropped by 70%.

Both platforms have adjusted their logistics models in response to these tariffs, moving away from a drop shipping approach to establish a network of warehouses within the U.S. Despite challenges in the American market, Temu has seen growth internationally, with non-U.S. users comprising 90% of its global MAUs in the second quarter.

Analysts from HSBC noted that this growth was particularly notable in Europe, Latin America, and less affluent regions. As such, many Chinese platforms are now focusing their efforts on expanding in these international markets.