Jumia, which is one of Africa’s biggest online shopping websites, recently shared its results for the third quarter of 2024. The company faced some tough times during this period, continuing to lose money and struggling to find ways to become profitable.
What Happened This Quarter
- Sales Decline: Jumia’s revenue dropped to $36.4 million, which is 13% less than what they earned during the same period last year. Despite this, their expenses on sales and advertising stayed the same as last year.
- Commissions Boost: The small amount of revenue they made this quarter mostly came from commissions earned on sales made by other companies in Egypt. However, they faced setbacks because the value of money in countries like Nigeria and Egypt decreased, which affected their earnings.
Jumia’s CEO, Francis Dufay, noted that while the company is still working hard to expand its product variety and attract more customers, they are feeling the effects of currency problems. Despite these challenges, they saw a 1% increase in the number of active customers and a 4% increase in total orders compared to last year.
Key Numbers to Know
- Total Revenue: $36.4 million for this quarter.
- Losses: Operational losses increased to $20.1 million.
- Active Customers: Steady at 2 million.
- Market Focus: Jumia plans to concentrate only on markets that show good potential, which means they will shut down operations in South Africa and Tunisia by the end of this year.
Looking Ahead
To improve its financial situation, Jumia is narrowing its focus and has decided to leave less profitable markets. The company is also looking to strengthen its logistics and increase its product range and customer base.
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Although the number of customers has not changed compared to last year, Jumia is working hard to keep its existing customers by using a network of sales agents and online marketing techniques.
Financial Position
As of now, Jumia has $85.8 million in cash and a total of $164.6 million in liquidity, which has increased mainly due to a recent stock offering that brought in $94.7 million after deducting costs.
Growth in Payments
Another bright spot in their report is the growth of JumiaPay, their payment service. Transactions processed through JumiaPay rose to $3 million this quarter, which is a 10% increase compared to last year. They are focusing on making the payment process easier for users, which is important for the overall success of their online business.
Stock Market Performance
Jumia’s stock price has increased by 43% this year, which has pleased investors and analysts. Currently, shares are trading at $4.82, benefiting from increased confidence in the company’s future.
In summary, Jumia is facing significant challenges but is making strategic changes to improve its position and focus on more promising markets.
