Jumia experiences inflation as orders for goods decline by 36.5% in a year.

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Jumia experiences inflation as orders for goods decline by 36.5% in a year.

By: Peace Adisa 

 

Jumia’s Q2 2023 financial data, which show a 28.1% decline in client base, show that inflation is getting worse in the company’s key operational markets, including Nigeria, Ghana, and Egypt.

According to the firm, there were 2.4 million active users in Q2 2023 as opposed to 3.4 million in Q2 2022, a 1 million decrease year over year. Jumia’s platform’s gross merchandise value, or GMV, fell from $271.1 million in Q2 2022 to $202.3 million in Q2 2023, a reduction of 25.1%.

According to the financial report, there were 36.5% fewer product orders submitted on the website. There were 6.5 in Q2 of this year. Compared to 10.3 million in Q2 of 2022. Million orders.

Francis Dufay, CEO of the Jumia Group, claimed that despite a fall in sales and customer base, the company is making headway in cutting losses.

“We continue to deliver strongly on our overriding objective of loss reduction and progress towards profitability,” Dufay stated in response to the Q2 financial results. Both Adjusted EBITDA and Operating losses fell by 66% year over year in the second quarter of 2023, reaching the lowest levels in more than 4 years.

We are revising our adjusted EBITDA loss projection for the entire year 2023 from $100-120 million to $90-100 million in light of this significant achievement.

“We are strengthening our efficiency while maintaining discipline as we navigate difficult macro conditions.” Fulfillment Sales & Advertising costs were down 50% and 74%, respectively, from the second quarter of 2022.

With G&A excluding share-based compensation falling by a third year over year and reaching a 4-year low of $17.7 million, “we are also beginning to reap the benefits of our actions on overhead costs.”