Jumia’s revenue and gross merchandise volume showed growth despite a decrease in quarterly active customers, according to its Q1 2024 report. Revenue grew 19% year-over-year (57% in constant currency) to $48.9 million, while GMV jumped 5% year-over-year (39% in constant currency) to $181 million.
In contrast, the African online retailer’s quarterly active customers declined by almost 5%, from 2 million to 1.9 million, due to cost-cutting measures such as reduced customer incentives and free delivery expenses. However, this exercise has led to a more loyal and higher quality customer base with increased repurchase rates. Average order value increased 3% from Q1 2023 to $39.6 million. Interestingly, despite the decline in customer base, Jumia’s quarterly orders saw an increase of 1.9% to 4.6 million. Jumia attributes this growth to the continued improvement of its sourcing and product assortment.
“This quarter is special because we have finally returned to growth in GMV and orders. For a year and a half, very few people outside believed that we would be able to grow Jumia again with this level of cuts to marketing, staff and everything else. But it turns out we can do it with lower marketing, logistics and general and administrative costs,” CEO Francis Dufay said in a call with TechCrunch. “I mean, there are a lot fewer people at Jumia today running the company. We have lost around 40% of our workforce since the end of 2022. And yet, we continue to grow. So this is a very significant achievement, and we believe we still have a lot of market potential to capture in our markets. »
The e-commerce company says the increase in revenue is due to the sale of more expensive items, such as electronics and home and everyday items, as well as higher commissions and business sales. Likewise, GMV growth reflects efforts to improve its product assortment, more efficient marketing spend and reductions in customer incentives, with marketing spend falling 30% compared to the first quarter of 2023.
Additionally, this disciplined expense management and increased streamlining of its logistics network reduced Jumia’s quarterly cash burn to $19.1 million from $22.0 million in the first quarter of 2023. Therefore, its loss operating revenue and its adjusted EBITDA loss for the quarter fell 71% year-over-year and 83% year-over-year, to $8 million and $4 million respectively, demonstrating a continued effort by the company to significantly reduce costs and improve gross margins until it achieves profitability.
A key driver of Jumia’s quest for profitability continues to be JumiaPay (the ratio of JumiaPay orders to physical goods increased from 20% to 32.5% in Q1 2024). The continued rollout of JumiaPay to delivery in Nigeria and Kenya to increase cashless orders positions JumiaPay as a more powerful enabler of its overall e-commerce platform; JumiaPay saw its transactions reach 2 million, an increase of 52% year-on-year, while recording 10% year-on-year growth in total processing volume (TPV) to 45 .4 million dollars in the first quarter of 2024.
Jumia, whose share price has risen 26% to $6.90 since reporting its results, said its liquidity position in the first quarter of 2024 stood at $101.5 million, with 28 $.6 million in cash and cash equivalents and $72.8 million in term deposits and other financial assets. The company noted that 79% of its cash was denominated in US dollars, providing protection against fluctuations in local currency prices (it suffered a cash loss of $5.9 million due to the conversion of currencies linked to devaluations in Egypt and Nigeria, two of its largest markets, during the exchange period). quarter).
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