Jumia has projected a growth in its topline despite macro-economic headwinds expected to persist in 2024.
The company forecasted a return to topline growth in both orders and GMV, excluding potential foreign exchange impacts. This confidence stems from their unwavering commitment to their growth strategy, which includes several key priorities: executing the growth strategy, leveraging technology and data, and unlocking potential in key markets.
The company noted that it will continue to focus on improving supply chains in its core categories, driving customer acquisition through efficient marketing channels, and expanding its reach into secondary cities across Africa.
According to the company, Jumia’s story is not just about surviving challenging times, but about emerging stronger and more prepared for the future. By prioritising efficiency, focusing on core business areas, and adopting a more data-driven approach to marketing, Jumia has reaffirmed its position as a leader in Africa’s dynamic e-commerce landscape. As the company continues to execute its strategy and capitalise on its unique position, it is well on its way to truly shaping the continent’s digital future.
The company in its fourth quarter (Q4), 2023 financial results witnessed a 90 per cent year-over-year decline in operating loss, accompanied by an even more impressive 99 per cent drop in adjusted EBITDA loss. This dramatic improvement wasn’t achieved through aggressive cost cuts, but rather through a comprehensive approach focused on improved unit economics and operational efficiency.
Further, decreases in sales and advertising expense, down 63 per cent year-over-year, and general and administrative expenses, down 54 per cent year-over-year, contributed to the decrease in losses. By optimizing logistics and marketing strategies, Jumia was able to achieve significant cost savings without compromising growth potential.
JumiaPay, the company’s digital payment platform is playing a crucial role in streamlining operations and enhancing customer experience. JumiaPay’s Total Payment Volume (TPV) stood at $59.3 million in Q4 2023, marking a 10 per cent decrease year-over-year. However, transactions inched higher to three million, a 41 per cent increase year-over-year. Likewise, 45 per cent of orders on the Jumia platform in Q4 2023 were completed using JumiaPay, up from 31 per cent in Q4 2022.
However, the Company said “Jumia’s 2023 was not without its share of difficult decisions. Recognizing the challenging economic environment and its impact on consumer spending, the company took bold steps to streamline its operations. This included discontinuing activities with poor growth prospects, restructuring its business model, and implementing significant reductions in marketing spend. While these initial choices had a short-term impact, they were crucial in laying the groundwork for a financially stronger and more sustainable future.”
