Jumia Technologies, Africa’s leading e-commerce platform, reported a 10% decline in annual revenue for 2024, totaling $167.5 million. Despite the drop, the company showcased resilience through cost-cutting measures, improved operational efficiencies, and strategic expansion beyond urban centers.
In the second quarter of 2024, Jumia’s reported revenue fell by 17% to $36.5 million, primarily due to currency devaluations in key markets. However, on a constant currency basis, revenue increased by 15%, reflecting strong underlying performance. The company’s Gross Merchandise Value (GMV) also mirrored this trend, decreasing by 5% in reported terms but growing by 35% in constant currency, reaching $170.1 million in Q2 2024.
“Under the leadership of CEO Francis Dufay, the company has focused on enhancing cash efficiency, refining its customer value proposition, and leveraging strategic partnerships, resulting in notable operational and financial improvements,” Jumia stated.
Financial Performance Highlights
- Annual Revenue: $167.5 million, down 10% year-over-year from $186.4 million in 2023.
- Gross Merchandise Value (GMV): $720.6 million, reflecting a 4% year-over-year decline.
- Operating Loss: Reduced to $66 million from $73.3 million in 2023, driven by cost management.
- Adjusted EBITDA Loss: Improved by 10% year-over-year to $16.3 million in Q2 2024.
- Net Cash Flows: Cash burn was cut by more than half, falling to $8.7 million due to a 19% reduction in marketing expenses and efficient resource utilization.
- Liquidity Position: Improved to $133.9 million, reflecting an increase of $13.4 million, including proceeds from the August 2024 At-the-Market (ATM) offering.
Despite the revenue decline, Jumia managed to reduce its operating costs by 8% year-over-year to $20.2 million. The company attributed its improved cost management to disciplined expenditure and a focus on high-return marketing channels such as CRM, SEO, and targeted offline initiatives.
Operational Performance and Market Expansion
Jumia’s marketplace revenue, comprising third-party sales, marketing, and value-added services, declined by 31% year-over-year to $22.8 million. This drop was primarily driven by currency devaluations and lower commissions from corporate sales in Egypt. However, the number of orders grew by 6% to 22.7 million, with orders from outskirt regions accounting for 56% of total orders in Q4 2024, up from 49% in Q4 2023.
The company also expanded its logistics network by opening new warehouses in Nigeria and Morocco. These facilities aim to increase storage capacity and enhance supply chain efficiency while minimizing the impact on the balance sheet through a leasing model rather than facility ownership.
In 2023, Jumia exited the South African and Tunisian markets to concentrate on larger markets like Nigeria, Morocco, and Egypt. This strategic shift has helped the company streamline its operations and focus on regions with higher growth potential.
Currency Impact and Financial Resilience
Currency devaluations in key African markets significantly impacted Jumia’s financial performance, affecting both GMV and Total Payment Volume (TPV). TPV declined by 7%, largely mirroring the GMV decrease. However, Jumia’s decision to hold 67% of its liquidity in USD mitigated some currency risks, demonstrating a prudent approach to financial management.
The company emphasized that its Q2 2024 results reflect a period of determined execution against its strategic priorities, showcasing its ability to navigate market challenges while maintaining operational efficiency.
Outlook for 2025: Focus on Profitability and Growth
Looking ahead, Jumia is optimistic about its performance in 2025. The company forecasts a loss before income tax of between $65 million and $70 million, representing a year-over-year decrease of 33% and 28%, respectively. Favorable trends observed in the first quarter of 2025 have reinforced this positive outlook.
CEO Francis Dufay highlighted Jumia’s strategic priorities for the year: “We plan to double down on expansion outside major urban centers, diversify our product assortment with competitive pricing, and strengthen relationships with international sellers. To improve our path to profitability, we will continue enforcing cost discipline and enhancing operational and marketing efficiency.”
Jumia anticipates physical goods orders to grow between 15% and 20% year-over-year in 2025. This growth will be driven by the company’s expanding logistics network, improved supply chain capabilities, and a commitment to offering essential items at lower prices than physical stores.
Conclusion
Despite the challenges posed by currency devaluations and a competitive e-commerce landscape, Jumia’s 2024 performance reflects its resilience and adaptability. Through strategic cost-cutting measures, operational improvements, and targeted market expansion, the company has strengthened its financial position. As Jumia continues to optimize its product offerings and expand beyond major urban centers, it is well-positioned to drive sustainable growth and achieve profitability in 2025.
