Jumia narrows losses to $48.7m on new operational strategy

Jumia’s losses slowed to $48.7 million in the first nine months of 2024 from $68.8 million in the corresponding period of 2023 after shifting its operational strategy to cut excesses and chart a path toward profitability.

In the last year, the e-commerce company has taken several major operational steps, such as improving its logistics network and consolidating its warehouse footprint, to enable greater efficiencies and increase supply capacity.

Despite these measures, the company continues to deal with macroeconomic pressures, especially currency devaluations in Nigeria and Egypt.

Its financial statement released on Thursday revealed that total revenue fell to $121.8 million as of the nine months ended September 2024 from $127 million in the corresponding period of 2023. However, its gross profit increased to $75.6 million from $70 million.

Read also: Jumia exits South Africa, Tunisia to focus on profitability

Commenting on Q3’s result, Francis Dufay, Jumia’s chief executive officer, said, “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.”

He highlighted the company’s operational shifts are expected to drive scale and profitable growth as it expands its footprint beyond major cities. He noted that the company’s decision to cease operations in South Africa and Tunisia will also help it allocate scarce resources to markets with stronger growth potential. This move will reduce Jumia’s footprint from 11 to 9 countries.

“While these updates will have a near-term impact on our operations and financial performance, we believe that our efforts position the business well to scale on our path to profitability. As we move forward, we are committed to taking a disciplined approach to managing our operations. The proceeds of our recent capital raise will help to accelerate our growth trajectory,” he stated.