Africa’s leading e-commerce group, Jumia, has significantly reduced its operating losses by 71% year over year to $8.3 million in the first quarter of 2024, compared to $28 million in the same period of 2023. The company attributed this achievement to substantial cost reductions and improved gross margins as part of its strategic plans toward profitability.
Despite a 5% decline in its active customer base, Jumia reported a notable 19% year-on-year revenue growth in Q1 2024, reaching $49 million. Additionally, the gross merchandise value (GMV) increased by 5% year-on-year to $181 million, reflecting the total amount paid by customers before deductions.
The decline in active customers from 2 million to 1.9 million was a result of cost-cutting measures implemented by Jumia, including reduced customer incentives and free shipping expenditures. However, these measures contributed to retaining a higher-quality customer base with increased repurchase rates.
Jumia’s CEO, Francis Dufay, expressed confidence in the company’s performance, stating that they are off to a strong start in 2024. He emphasized the focus on strengthening Jumia’s core business, improving cash efficiency, and establishing a leaner organization for future growth.