The company generated revenues of $36.4 million, which reflects a 13% decline year-over-year; however, when adjusted for constant currency, there was a 9% increase, showcasing resilience in its primary markets despite notable currency depreciation in Nigeria and Egypt.
Jumia's Gross Merchandise Value (GMV) for the quarter was $162.9 million, a slight decrease of 1% year-over-year, yet it showed a significant 29% increase in constant currency.
In spite of the revenue drop, Jumia saw a modest rise in its active customer base, which grew by 1% year-over-year, while the number of orders increased by 4%, indicating consistent engagement despite external pressures.
Additionally, Jumia reported an improved liquidity position of $164.6 million, supported by proceeds from its At-the-Market (ATM) offering in August 2024. This is a notable recovery from a liquidity decline of $19 million in Q3 2023, providing the company with enhanced resources to drive growth while adhering to a prudent spending strategy.
Francis Dufay, the CEO of Jumia, shared his perspectives on the results, noting: “We are encouraged to see continued resilience in our usage and business fundamentals despite the significant first quarter currency depreciation headwinds in Nigeria and Egypt that continue to impact reported GMV and topline revenue.
We undertook several major operational steps in the quarter, including improvements to our logistics network and the consolidation of our warehouse footprint to enable greater efficiencies and increase supply capacity.
“While these changes negatively impacted operations and expenses in the third quarter, we believe that these efforts position us well to scale and drive profitable growth as we expand our footprint beyond the major cities (“upcountry”).”
As part of its strategic realignment, Jumia has halted operations in South Africa and Tunisia to redirect resources toward markets with greater growth potential.
This decision follows a comprehensive assessment of the company's operational footprint, aimed at enhancing efficiencies within its logistics network and streamlining its warehousing capabilities.
“Although these changes will have a short-term effect on our operations and financial results, we are confident that these initiatives will position the business favorably for scaling as we pursue profitability,” stated Dufay.
When the company disclosed its withdrawal from South Africa and Tunisia last month, it emphasized that this strategic decision was intended to optimize resource allocation and concentrate on markets with more robust growth prospects across the continent, including Nigeria and others. The company noted that this choice was made after evaluating its performance in the two countries, which represented a minor portion of its overall business.
For the year ending December 31, 2023, and the first half of 2024, Jumia reported that South Africa and Tunisia contributed only 3.5% and 2.7% of total orders, and 4.5% and 3.0% of gross merchandise value (GMV), respectively.
Following a 64% reduction in operating losses for 2023, bringing the total down to $73 million, Jumia’s CEO, Dufay, who has been implementing various strategies to mitigate losses and achieve profitability, expressed optimism that the company would return to growth this year while further decreasing its losses.
He noted that the results from recent quarters have demonstrated significant progress toward Jumia’s strategic objectives, positioning the company for revenue growth and better cash management in 2024.
Prior to this, in Q4 2022, Jumia had already taken steps to reduce its ongoing losses by cutting its workforce by 20%, resulting in the departure of 900 employees. The company also discontinued its food delivery service, Jumia Food, which was deemed unprofitable.