Jumia Technologies, a prominent African e-commerce entity, disclosed a noteworthy contraction in its Q3 losses, marking a 67% decrease compared to the preceding year. The company, situated in the competitive landscape of the African tech sector, is strategically implementing cost-cutting measures to steer towards profitability. These initiatives include substantial workforce reductions, rationalizing product offerings with a focus on essentials like groceries, and curtailing non-core delivery services.
Thank you for reading this post, don't forget to subscribe!In its financial report, Jumia, recognized as the inaugural Africa-centric tech startup listed on the New York Stock Exchange, reported an adjusted EBITDA loss of $15 million for the three months ending September 30. This constitutes a substantial improvement from the $46 million loss incurred during the corresponding period in 2022. Francis Dufay, the Chief Executive, emphasized the salient reduction in losses and efficient cash utilization, culminating in a strengthened liquidity position of $147 million as of September’s conclusion.
The outlook for Jumia anticipates a further refined financial performance, with a projected adjusted EBITDA loss ranging between $80 million and $90 million for 2023. This revised estimate contrasts with the earlier communicated range of $90 million to $100 million. Despite a year-on-year revenue decline of 11% to $45 million, attributed to currency weaknesses in diverse markets, the constant currency terms indicate a robust 19% upswing.
However, Jumia faced challenges as quarterly active consumers witnessed a significant decline of 24.3%, totaling 2.3 million. This reduction primarily stems from strategic decisions to concentrate on core product categories while simultaneously diminishing consumer incentives. The persistence of inflation effects during the reporting period impacted both consumer purchasing power and the ability of sellers to procure goods internationally, as stated by Jumia.
