Jumia cuts losses by over 90% by focusing on restoring order and growing GMV


In 2023, Jumia revised its adjusted EBITDA loss forecast three times: $100-120 million in the first quarter, $90-100 million in the second quarter and $80-90 million in the third quarter, targeting a reduction of 57 to 61% from one year to the next if respected.

The company exceeded these expectations and significantly outperformed in this regard. It ended the year with an adjusted EBITDA loss of $58.2 million, a 68% decrease from 2022, and the fourth quarter ended with less than $1 million in adjusted losses. , a reduction of 99%. Jumia’s operating loss narrowed 90% to $4 million this quarter and 64% to $73 million for the full year, leading to an improvement in the liquidity position, closing the year with 121 million dollars. according to its financial results for the 4th quarter of 2023 and the full year.

These losses were reduced mainly by a reduction in tax provisions in certain countries, a non-recurring event occurring in the last quarter of 2023. In addition, significant decreases in commercial and advertising expenses, down 63% year-on-year other, and general and administrative expenses. expenses, down 54% year-on-year, contributed to this. For the latter, Jumia’s notable exit from the food delivery sector in the fourth quarter led to layoffs and departmental restructuring, resulting in a 17% decrease in personnel costs within the year-over-year general and administrative expenses. on the other.

“We will continue to seek greater efficiency, whether on a daily, monthly or weekly basis. We continue to find new opportunities to be a little leaner and spend a little less money, not only on personnel but also on tools, logistics, etc. In some countries, we have identified that we could be a little leaner in certain departments. This is ongoing optimization and we are making adjustments, so it’s business as usual for us. said Francis Dufay, CEO of Jumia, during a call with TechCrunch.

In addition to macroeconomic conditions such as currency devaluations impacting consumer purchasing power, Jumia’s strategic decisions, including exiting the food delivery sector and reducing customer incentives, have contributed to a 4% decline in orders to 6.6 million, a 16% reduction in active customers to 2.3 million and an 8% decline in GMV year-over-year to $233 million.

Nonetheless, the company remains optimistic that its focus on physical goods, such as electronics and fashion items, will improve these metrics while minimizing losses. A slight indicator is the quarterly increase in active customers, orders and GMV of 16%, 17% and 42%, respectively, quarter over quarter, mainly fueled by the success of Black Friday sales campaigns and Christmas. There is also the increase in the average order value of physical goods from $40.6 in 2022 to $45.5 in 2023, which likely lessened the impact on the company’s revenue which saw a modest 2% year-over-year decline to $59.4 million.

“In 2024, we expect to further improve our economic situation and reduce cash burn better than in 2023 and return to growth in orders and GMV excluding currency impact,” Dufay said. “We will maintain the same strategy on the marketing side to be very careful and conservative on all expenses and on the entire cost base, and with that, we believe we have everything it takes to grow by cost-effective manner.”

Investors have shown their approval for Jumia’s cost-cutting measures throughout the year, with its share price up more than 35% at press time.

Meanwhile, JumiaPay’s total payments volume (TPV) stood at $59.3 million in Q4 2023, a 10% year-on-year decrease. However, transactions surged, reaching 3 million, an increase of 41% year-on-year; 45% of orders on the Jumia platform in Q4 2023 were finalized with JumiaPay, compared to 31% in Q4 2022.


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