Jumia Technologies ((JMIA)) has held its Q1 earnings call. Read on for the main highlights of the call.
The recent earnings call for Jumia Technologies painted a mixed picture, reflecting both optimism and challenges. The company has made strides in cost management and customer engagement, alongside strategic expansions. However, these positives are tempered by a decline in revenue and significant losses in certain markets, particularly Egypt, which weigh heavily on the company’s outlook.
Improved Loss Projections
Jumia Technologies has revised its loss before income tax guidance for 2025, projecting a reduction to $50 million to $55 million, down from the previous estimate of $65 million to $70 million. This improvement highlights the company’s efforts to streamline operations and enhance financial efficiency.
Physical Goods Orders Growth
The company has increased its guidance for physical goods orders growth to 20% to 25%, up from the earlier forecast of 15% to 20%. This upward revision is indicative of strong demand and successful strategic initiatives.
Cost Reduction Success
Jumia has successfully reduced fulfillment expenses per order to $2.1, marking a 14% reduction year-over-year. This achievement underscores the company’s focus on cost management and operational efficiency.
Positive Customer Engagement
The number of quarterly active customers has grown from 1.9 million in Q1’24 to 2.1 million in Q1’25, reflecting a 15% increase. This growth demonstrates enhanced customer engagement and satisfaction.
International Vendor Growth
Jumia has experienced a 61% year-over-year increase in international orders from Chinese vendors, highlighting the company’s expanding global reach and vendor network.
Strategic Expansion
The company is expanding its logistics services, such as Jumia Deliveries, to Nigeria following a successful pilot in Ivory Coast. This move is part of Jumia’s broader strategy to enhance its logistics capabilities.
Decline in GMV
Jumia reported an 11% year-over-year decline in overall GMV, attributed to currency headwinds and reduced corporate sales in Egypt. This decline poses a challenge to the company’s growth trajectory.
Revenue Decline
The company’s revenue for the quarter was $36.3 million, down 26% year-over-year and 18% in constant currency. This decline reflects ongoing challenges in the market.
Increased Loss in Adjusted EBITDA
Jumia’s adjusted EBITDA loss increased to $15.7 million in Q1’25 from a loss of $4.3 million in Q1’24, indicating financial pressures despite operational improvements.
Challenges in Egypt
In Egypt, physical goods orders decreased by 15% year-over-year, and GMV fell by 69% in USD terms, highlighting significant market-specific challenges.
Forward-Looking Guidance
Jumia’s forward-looking guidance reflects a strategic focus on reducing losses and improving financial efficiency. The company anticipates a loss before income tax of $50 million to $55 million for 2025, with a further reduction to $25 million to $30 million in 2026. Jumia aims to achieve profitability by Q4 of 2026 and full-year profitability in 2027. The company also projects a 10% to 15% increase in GMV for 2025, excluding foreign exchange impacts.
In conclusion, Jumia Technologies’ earnings call revealed a company navigating a complex landscape of growth opportunities and market challenges. While there are clear improvements in cost management and customer engagement, the decline in revenue and significant losses in markets like Egypt remain critical concerns. The company’s forward-looking guidance suggests a strategic emphasis on achieving profitability and sustaining growth in the coming years.