Jumia Reports $20 Million Loss in Q3 2024 Amid Economic Challenges
Jumia Technologies, Africa’s top e-commerce platform, reported a $20.1 million operating loss in the third quarter, ending on September 30, 2024. The 12-year-old company disclosed these results in its financial statement released on Thursday, attributing the loss to ongoing macroeconomic challenges that have affected consumer demand and increased operational costs across its markets.
This quarter’s performance showed a slight decline compared to the $18.3 million loss recorded in the same period last year.
Key Financial Highlights
- Revenue: Despite a 13% year-over-year revenue drop to $36.4 million, Jumia reported a 9% increase in revenue in constant currency terms. Additionally, gross merchandise volume (GMV) grew by 29% over last year’s Q3 figures, demonstrating strength in overall transaction volume.
- Adjusted EBITDA: Adjusted EBITDA, which excludes certain non-cash and non-operating items, showed a loss of $17 million. This represents a 15% increase from the $14.8 million loss reported in Q3 2023.
Strengthening Financial Position
Jumia has taken steps to bolster its financial position amid economic challenges. In August, the company raised an additional $71.8 million through an at-the-market offering, which brought its total liquidity to $164.6 million. This cash injection highlights Jumia’s efforts to manage economic headwinds and maintain financial stability.
CEO’s Statement on Business Strategy
Francis Dufay, Jumia’s Chief Executive Officer, commented on the quarter’s performance, stating, “In the third quarter, we continued to strengthen the underlying fundamentals of the business.”
Dufay also noted that quarterly active customers rose by 1% year-over-year, while orders increased by 4%. He emphasized Jumia’s focus on diversifying its product offerings and enhancing its value proposition to customers across its markets.
Jumia’s CEO, Francis Dufay, expressed optimism regarding the company’s resilience, despite significant currency depreciation in key markets like Nigeria and Egypt, which impacted reported gross merchandise volume (GMV) and top-line revenue in Q3. “We are encouraged to see continued resilience in our usage and business fundamentals,” Dufay noted, as the company navigates currency-driven challenges.
Operational Enhancements and Efficiency Measures
In Q3, Jumia took notable steps to improve operational efficiency, including optimizing its logistics network and consolidating its warehouse infrastructure. These actions are aimed at streamlining costs and expanding supply capacity. While these changes temporarily increased operational costs, Dufay believes they position Jumia to scale efficiently and drive long-term profitability, particularly as the company expands into more remote regions beyond major cities, or “upcountry.”
Strategic Market Reallocations
Jumia recently made the strategic decision to cease operations in South Africa and Tunisia, redirecting resources toward markets with stronger growth potential. Although this shift will have short-term effects on operations and financials, Dufay emphasized that these actions better align with Jumia’s long-term growth strategy.
Commitment to Sustainable Growth
Dufay also highlighted the importance of maintaining disciplined financial management. He stated that the recent capital raise will help accelerate Jumia’s growth but underscored the company’s commitment to a measured approach to spending, ensuring long-term profitability. “Our efforts position the business well to scale on our path to profitability,” he said.