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01/11 11:04
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights several positive aspects: improved cost efficiency, expansion into underserved regions, strengthened supplier relationships, and increased growth guidance. The Q&A session reveals optimism about growth potential in secondary cities, improved supply chain stability, and profitability in logistics. Despite some unclear responses, the overall sentiment is positive, driven by the raised growth projections and strategic focus on cost control and expansion. The absence of negative catalysts and the company's focus on growth and efficiency suggest a positive stock price movement in the near term.
Orders Physical goods orders grew 18% year-over-year, driven by strong demand, affordability, assortment strategy, expansion to secondary cities, and effective marketing channels.
Gross Merchandise Value (GMV) GMV grew 10% year-over-year in reported currency and 24% excluding corporate sales, driven by healthy momentum in the core consumer business.
Revenue Revenue rose by 25% year-over-year to $45.6 million, driven by increased usage and stronger monetization of the marketplace.
Loss Before Income Tax Loss before income tax narrowed to $16.3 million, a 28% decrease year-over-year, driven by higher revenue across multiple streams and disciplined execution.
Cash Burn Cash burn reduced to $12.4 million, driven by higher revenue and disciplined cost management.
Gross Profit Gross profit was $23.9 million, up 11% year-over-year, driven by stronger marketplace margins.
Fulfillment Cost Per Order Fulfillment cost per order was $2.19, up 1% year-over-year or down 5% on a constant currency basis, reflecting improved warehouse staff productivity and consumer support operations.
Advertising Revenue Advertising revenue was $1.9 million, accounting for 1% of GMV, with potential for growth as a high-margin revenue stream.
Net Cash Flow Used in Operating Activities Net cash flow used in operating activities was $12.7 million, including a $4.1 million positive working capital contribution.
Marketplace Revenue Marketplace revenue was $21.6 million, up 8% year-over-year, driven by strong usage growth and increases in take rate, but partially offset by lower commissions from third-party corporate sales in Egypt.
First Party Sales Revenue Revenue from first-party sales was $23.6 million, up 47% year-over-year, driven by strong demand with key international brands like Starlink and Adidas.
Physical Goods Growth: Orders increased by 18% year-over-year, GMV grew 10% excluding exits from South Africa and Tunisia. Excluding corporate sales, GMV grew 24%.
Jumia Anniversary Campaign: Strengthened consumer engagement and drove order growth. Over 38,500 sellers participated, up from 36,400 in 2024.
Advertising Revenue: Generated $1.9 million, accounting for 1% of GMV, with plans to scale this high-margin revenue stream.
Geographic Expansion: Expanded to secondary cities and underserved regions, with orders from these areas now representing 59% of total volumes, up from 52% last year.
Country Highlights: Nigeria: Orders up 25%, GMV up 36%. Kenya: Orders up 38%, GMV up 31%. Ghana: GMV up 110%.
Cost Management: Reduced headcount by 5%, improved cash burn to $12.4 million, and achieved $4.1 million positive working capital contribution.
Technology Efficiency: Expanded AI implementation and renegotiated vendor agreements, including a new AWS contract.
Fulfillment Costs: Cost per order increased 1% to $2.19, down 5% on a constant currency basis.
Focus on Physical Goods: Shifted emphasis away from JumiaPay app transactions to scale physical goods e-commerce, which accounts for 99% of orders.
Regulatory Engagement: Increased public affairs efforts to improve local regulatory frameworks and strengthen market leadership.
Currency Devaluation: Significant currency devaluations in Egypt and Nigeria have impacted year-over-year comparisons and financial performance, though the company claims to have lapsed these effects.
Fulfillment Costs: Fulfillment cost per order increased by 1% year-over-year, which could impact profitability if not managed effectively.
Market Competition: Increased competition from international e-commerce platforms, particularly in Nigeria, poses a challenge to Jumia's market share.
Regulatory Risks: Regulatory scrutiny and changes, such as the U.S. decision to eliminate the de minimis loophole, could impact operations and create uncertainties.
Macroeconomic Environment: Difficult macroeconomic conditions in Egypt, including reduced corporate sales and a 50% decline in GMV in reporting currency, present challenges to recovery and growth.
Technology Costs: Technology and content expenses increased by 6% year-over-year, which could strain financials if not offset by efficiency gains.
Cash Burn: Although cash burn has improved, the company still used $12.7 million in operating activities this quarter, which could pose liquidity risks if not managed carefully.
Dependence on Key Markets: Heavy reliance on key markets like Nigeria and Kenya for growth could expose the company to risks if these markets face downturns or increased competition.
Supply Chain Risks: Dependence on international sellers, particularly from China, for assortment expansion could expose the company to supply chain disruptions or geopolitical risks.
Advertising Revenue: Advertising revenue remains low at 1% of GMV, indicating underutilization of this high-margin revenue stream.
2025 Financial Guidance: Physical Goods (PG) Orders growth is expected to be in the range of 25% to 30%, revised upwards from the previous range of 20% to 25%. GMV is projected to grow between 15% and 20% year-over-year, revised upward from the previous range of 10% to 15%. Loss before income tax is anticipated to be in the range of negative $45 million to negative $50 million.
2026 Financial Targets: The company maintains its target for loss before income tax to be in the range of negative $25 million to negative $30 million. The strategic goal is to achieve breakeven on a loss before income tax basis in the fourth quarter of 2026.
2027 Profitability Goal: The company reaffirms its target to achieve full-year profitability in 2027.
Second Half of 2025 Growth Drivers: Accelerating usage growth driven by improved logistics network reliability and cost efficiency, broader geographic reach into underserved cities, enhanced assortment with better selection and competitive pricing, and disciplined marketing strategies.
Advertising Revenue Growth: The company sees substantial upside potential in scaling its high-margin advertising revenue stream, which currently accounts for 1% of GMV.
Technology and Operational Efficiency: Ongoing initiatives include AI implementation, renegotiated vendor agreements, and automation to improve efficiency and reduce costs in technology and fulfillment operations.
Market Expansion and Penetration: Continued focus on penetrating underserved regions and secondary cities, particularly in high-potential markets like Nigeria and Kenya, to drive growth and profitability.
The selected topic was not discussed during the call.
The earnings call indicates strong growth prospects with revised upward guidance for 2025 and a strategic focus on market expansion and efficiency improvements. Despite some cautious management commentary, the overall sentiment is positive, driven by reduced costs, promising advertising potential, and a strong position in key markets. The Q&A section reinforced these positives with insights into sustainable customer growth and supply chain improvements. While there are some uncertainties, the overall outlook suggests a positive stock price movement.
The earnings call highlights several positive aspects: improved cost efficiency, expansion into underserved regions, strengthened supplier relationships, and increased growth guidance. The Q&A session reveals optimism about growth potential in secondary cities, improved supply chain stability, and profitability in logistics. Despite some unclear responses, the overall sentiment is positive, driven by the raised growth projections and strategic focus on cost control and expansion. The absence of negative catalysts and the company's focus on growth and efficiency suggest a positive stock price movement in the near term.
The earnings call reveals a decline in revenue, gross profit, and margins, with increased losses and cash burn, which are negative indicators. Despite a focus on operational efficiency and some positive trends in order growth and supply from Asia, the volatility in corporate sales and macroeconomic challenges, particularly in Egypt, weigh heavily. The Q&A section highlights risks of increased competition and lack of clear guidance on some financial metrics. The overall sentiment leans negative due to these financial struggles and uncertainties.
The earnings call reveals significant challenges: currency devaluation, declining corporate sales, increased operational costs, and widened losses. Despite some positives like order growth and improved efficiency, the overall financial performance is weak, with revenue, gross profit, and EBITDA all declining. The Q&A section highlights supply challenges and unclear responses from management, further dampening sentiment. Without a share buyback program or strong guidance, the stock is likely to react negatively over the next two weeks.
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