Market Overview - Africa's social commerce market is projected to grow at an annual rate of 26.7%, reaching USD 4.45 billion by 2025, following a robust CAGR of 38.4% from 2021 to 2024 [2][3] - The market is expected to expand from USD 3.51 billion in 2024 to approximately USD 9.43 billion by 2030, indicating sustained growth [2] Key Drivers - The rapid evolution of Africa's social commerce landscape is driven by mobile-first internet adoption, fintech integration, and the increasing role of social media platforms in online shopping [4] - A young, tech-savvy population and rising smartphone penetration create an ideal environment for businesses to engage with consumers through social channels [4] Platform Engagement - Platforms such as Facebook Marketplace, Instagram Shopping, and WhatsApp Business are essential for SMEs to access the digital economy [5] - Over 40% of internet users in key African markets have made purchases via social commerce platforms, highlighting the growing engagement [9] Fintech Integration - Mobile money and fintech innovations are breaking down barriers to digital transactions, making social commerce more accessible [6] - The introduction of Buy Now, Pay Later (BNPL) solutions and digital wallets enhances consumer participation in e-commerce [6][10] Competitive Landscape - The social commerce sector is becoming increasingly competitive, with local and international players striving for market share [13] - Jumia's strategic exit from South Africa and Tunisia aims to focus on high-growth markets in West and East Africa [16] - Takealot is expanding into underserved markets by hiring personal shoppers to increase e-commerce penetration [16] Influencer Marketing - Influencer marketing, particularly through micro-influencers, is driving social commerce growth, with brands increasing spending on partnerships [12][16] - The rise of live shopping and short-form video content on platforms like TikTok is reshaping consumer interactions with brands [12][16] Regulatory Developments - South African authorities are exploring regulatory "sandboxes" to foster innovation in social commerce, particularly in digital lending and AI-driven customer support [16]

Group 1 - Jumia Technologies reported a 7.9% gap down at the open after Q1 earnings, reminiscent of previous earnings reactions despite better news last time [1] - The company provided full-year guidance, indicating expectations for future performance [1] Group 2 - The article highlights the author's extensive experience in financial markets, including the dot-com bubble, financial crisis, and coronavirus pandemic, emphasizing the importance of understanding market extremes [1] - The author's blog offers unique perspectives on trading and investing, covering various financial instruments and leveraging both technical and fundamental analysis [1]

Core Insights - Jumia Technologies' shares surged by 24% following the announcement of solid growth in orders despite a 26% decline in revenue, indicating a potential inflection point for the company as it provided profitability guidance for 2027 [1][3][6] Financial Performance - Revenue decreased by 26% to $36.3 million, with a constant currency decline of 18%, influenced by the exit from Tunisia and South Africa [3] - Gross merchandise volume (GMV) fell by 11% to $161.7 million, or 2% in constant currency [3] - Adjusted EBITDA loss was reported at $15.7 million, continuing the trend of losses for the company [4] Growth Metrics - Orders for physical goods increased by 21%, marking the fastest growth rate in two years, while active customers ordering physical goods rose by 15% [3] - In Nigeria, orders grew by 22% and GMV increased by 20%, showcasing strong performance in that market [3] Future Outlook - For 2025, Jumia anticipates physical goods orders to grow by 20%-25%, an increase from the previous estimate of 15%-20%, with GMV projected to rise by 10%-15% to between $795 million and $830 million [5] - The company is focusing on conventional e-commerce, particularly in shipping physical goods, after exploring various business models [5][6]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $36.3 million, down 26% year over year and down 18% in constant currency, primarily due to lower corporate sales in Egypt and currency devaluation [19][36]. - Adjusted EBITDA loss was $15.7 million, compared to a loss of $4.3 million in Q1 2024, while loss before income tax improved to $16.5 million from $39.6 million year over year [19][41]. - Cash burn for the quarter was $23.2 million, including $8 million in working capital, with expectations to significantly reduce cash burn in upcoming quarters [14][41]. Business Line Data and Key Metrics Changes - Physical Goods orders grew 21% year over year, with quarterly active customers ordering Physical Goods increasing by 15% year over year, marking the highest growth rates in two years [15][16]. - GMV declined 11% year over year, primarily due to currency headwinds and lower corporate sales, but excluding corporate sales, GMV would have grown 10% year over year [16][19]. - Fulfillment expense per order decreased to $2.07, down 14% year over year, reflecting improved efficiency [39][11]. Market Data and Key Metrics Changes - In Q1 2025, Ivory Coast, Nigeria, Kenya, and Egypt represented approximately 26%, 22%, 15%, and 10% of company GMV respectively, with other markets contributing 27% [22]. - Nigeria saw Physical Goods orders grow by 22% and GMV increase by 18% year over year, while Kenya experienced a 36% growth in Physical Goods orders [23][24]. - Egypt's Physical Goods orders were down 15% year over year, with GMV decreasing 69% in USD and 54% in constant currency due to a decline in corporate sales [25][26]. Company Strategy and Development Direction - The company aims to reduce losses, drive efficiency, and deliver measurable financial improvements, with a focus on margin expansion and financial discipline [6][7]. - Jumia is expanding its logistics platform to monetize its infrastructure beyond the core marketplace, targeting third-party sellers and social commerce merchants [28][62]. - The company is also focused on cost management and operational discipline, with structural cost savings and margin expansion as core priorities for 2025 [43]. Management's Comments on Operating Environment and Future Outlook - Management noted that while currency headwinds have impacted profitability, they expect to see improved supply availability from Asian manufacturers, which could benefit the business [32][56]. - The company is on track to achieve profitability on a loss before income tax basis in Q4 2026, with full-year profitability targeted for 2027 [9][45]. - Management expressed confidence in the strategy direction and the path towards profitability, emphasizing the importance of operational discipline and cost management [33][43]. Other Important Information - The company has implemented a highly restrictive hiring policy and reduced total headcount by about 3% since the beginning of the year [11]. - Jumia remains debt-free, with liquidity at $110.7 million, including cash and cash equivalents [42][43]. - The company is seeing strong demand in key categories such as electronics, fashion, and home goods, indicating robust consumer engagement [15][16]. Q&A Session Summary Question: Can you explain the relationship between orders and GMV, particularly regarding corporate sales? - Management clarified that corporate sales are typically high-value orders that significantly impact GMV, leading to a disconnect between healthy order trends and declining GMV due to corporate sales weakness [49][50]. Question: How should we think about cash use from inventory levels necessary to fulfill growth? - Management indicated that a significant part of cash burn was due to increased working capital for inventory buildup ahead of major campaigns, but they expect lower working capital impact in the coming quarters [54]. Question: Have you seen an uptick in supply from Asia, and is that related to the raised physical order guidance? - Management confirmed an uptick in international vendor sales, particularly from China, contributing to the raised guidance for physical orders [55][56]. Question: What is the monetization strategy for the Jumia delivery business? - The delivery business is designed to be higher margin and lower volume compared to marketplace revenue, with profitability from day one due to well-known variable costs [90][92]. Question: What is the current status of customer growth and profitability in key markets? - Management reported a 15% year-over-year growth in active customers, with Nigeria and Ivory Coast showing strong acceleration, while profitability varies across markets [95].

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $36.3 million, down 26% year over year and down 18% in constant currency, primarily due to lower corporate sales in Egypt and currency devaluation [19][36]. - Adjusted EBITDA loss was $15.7 million in Q1 2025, compared to a loss of $4.3 million in Q1 2024 [19][41]. - Loss before income tax was $16.5 million, a significant improvement from $39.6 million in the same period last year [19][41]. Business Line Data and Key Metrics Changes - Marketplace revenue for Q1 was $18.1 million, down 30% year over year [36]. - Revenue from first-party sales was $17.8 million, down 21% year over year [36]. - Fulfillment expense per order decreased to $2.07, down 14% year over year, indicating improved efficiency [39][11]. Market Data and Key Metrics Changes - GMV declined 11% year over year, primarily due to currency headwinds and lower corporate sales, particularly in Egypt [16][19]. - Excluding corporate sales, GMV would have grown 10% year over year, highlighting strengths in the consumer business [16][19]. - Physical Goods orders grew 21% year over year, driven by strong demand [15][19]. Company Strategy and Development Direction - The company aims to reduce losses, drive efficiency, and deliver measurable financial improvements, with a focus on margin expansion and financial discipline [6][7]. - Jumia is expanding its logistics network to monetize its infrastructure beyond the core marketplace, which is expected to enhance cost efficiency [28][62]. - The company is targeting profitability by 2027, with a loss before income tax forecasted to improve significantly in 2026 [9][45]. Management's Comments on Operating Environment and Future Outlook - Management noted that while currency headwinds have impacted profitability, they expect to see improved growth trends moving forward as these effects have lapped [18][32]. - The company remains confident in its strategy and believes it is well-positioned to capture supply from Asia as global trade dynamics shift [32][56]. - Management emphasized the importance of operational discipline and cost management in achieving sustainable growth [43][33]. Other Important Information - The company has reduced its total headcount by about 3% as part of its cost control measures [11]. - Jumia's liquidity position at the end of Q1 was $110.7 million, including cash and cash equivalents [42]. - The company remains debt-free, with borrowing related solely to lease liabilities [43]. Q&A Session Summary Question: Can you explain the relationship between orders and GMV? - Corporate sales are typically high-value orders that generate significant GMV with few orders, leading to a disconnect when corporate sales decrease [49]. Question: How should we think about cash use from inventory levels? - A significant part of cash burn is due to increased working capital for inventory ahead of major campaigns, but lower impacts are expected in the coming quarters [54]. Question: Have you seen an uptick in supply from Asia? - There has been a strong trend in item sales from international vendors, particularly from China, with a 61% increase in gross items sold [55]. Question: What is the monetization strategy for the Jumia delivery business? - The delivery business is designed to be higher margin and lower volume compared to marketplace revenue, with profitability from day one [90]. Question: How significant is the deliveries business to revenue for Ivory Coast? - The deliveries business is profitable but lower than marketplace revenues, with potential for further scaling [93].

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $36.3 million, down 26% year over year and down 18% in constant currency, primarily due to lower corporate sales in Egypt and currency devaluation [33][34] - Adjusted EBITDA loss was $15.7 million in Q1 2025 compared to a loss of $4.3 million in Q1 2024, while loss before income tax improved to $16.5 million from $39.6 million year over year [17][39] - Cash burn for the quarter was $23.2 million, including $8 million in working capital, with expectations to significantly reduce cash burn in upcoming quarters [13][40] Business Line Data and Key Metrics Changes - Physical Goods orders grew 21% year over year, with quarterly active customers ordering Physical Goods increasing by 15% year over year, marking the highest growth rates in two years [14][15] - GMV declined 11% year over year, primarily due to currency headwinds and lower corporate sales, but would have grown 10% year over year excluding corporate sales [15][16] - Fulfillment expense per order decreased to $2.07, down 14% year over year, reflecting improved efficiency [10][37] Market Data and Key Metrics Changes - In Q1 2025, Ivory Coast, Nigeria, Kenya, and Egypt represented approximately 26%, 22%, 15%, and 10% of company GMV respectively, with other markets contributing 27% [20] - Nigeria saw Physical Goods orders grow by 22% and GMV increase by 18% year over year, while Kenya experienced a 36% growth in Physical Goods orders [21][22] - Egypt's Physical Goods orders were down 15% year over year, with GMV decreasing 69% in USD, primarily due to a decline in corporate sales [23] Company Strategy and Development Direction - The company aims to reduce losses, drive efficiency, and deliver measurable financial improvements, with a focus on margin expansion and financial discipline [5][6] - A comprehensive restructuring plan was launched in early 2024 to address operational challenges, particularly in Egypt [23] - The company is expanding its logistics platform to monetize its infrastructure beyond the core marketplace, targeting third-party sellers and social commerce merchants [25][60] Management's Comments on Operating Environment and Future Outlook - Management noted that while currency headwinds have impacted profitability, they expect a cleaner year-over-year comparison moving forward as these effects have lapped [16][34] - The company anticipates continued momentum in Q2 2025, with expectations for Physical Goods orders growth in the range of 20% to 25% [43][44] - Management remains confident in achieving profitability by Q4 2026 and full-year profitability in 2027, driven by cost management and volume increases [44][72] Other Important Information - The company has renegotiated or terminated several key software and hosting contracts, expecting significant cost savings starting in the second half of 2025 [11][38] - The liquidity position at the end of Q1 2025 was $110.7 million, with no financial debt, reflecting a strong cash position [40][41] Q&A Session Summary Question: Can you explain the relationship between orders and GMV? - Management clarified that corporate sales, which are high-value orders, significantly impact GMV, leading to a disconnect between orders and GMV [47][48] Question: How should we think about cash use from inventory levels? - Management indicated that increased working capital was primarily used to build up inventories ahead of significant commercial events, and they anticipate lower impacts from working capital in the coming quarters [51][52] Question: Have you seen an uptick in supply from Asia? - Management confirmed an uptick in international vendor sales, particularly from China, and expects this trend to continue as access to supply improves [53][54] Question: How do you plan to approach marketing as fundamentals improve? - Management stated that they are now in a position to be more aggressive with marketing in markets where fundamentals are strong, such as Nigeria [55][56] Question: What is the timeline for the logistics expansion? - Management explained that the logistics network is now stable enough to monetize outside the marketplace, with no negative impact on margins expected [60][62] Question: What is the visibility on 2026 guidance? - Management indicated that they expect to reach breakeven by Q4 2026, driven by growth and cost management efforts [72]

Presentation Q1 2025 Results Presentation May 8, 2025 Company Disclaimer IMPORTANT NOTICE This presentation includes forward-looking statements. All statements other than statements of historical facts contained in this presentation, including statements regarding our future results of operations and financial position, industry dynamics, business strategy and plans and our objectives for future operations, are forward-looking statements. These statements represent our opinions, expectations, beliefs, inten ...

Supervisory Board Structure and Responsibilities - The supervisory board currently consists of five members, with a requirement for at least 40.0% female representation by December 31, 2024[601]. - The company must obtain supervisory board approval for material modifications to its business fields, including entering new fields of business[602]. - The supervisory board is responsible for monitoring the management board and must receive regular reports on current operations and future planning[590]. - The supervisory board has established a requirement for a quorum of at least half of its members to be present for voting[600]. - The supervisory board has the authority to initiate or terminate court cases involving amounts greater than €1.0 million[608]. - The company is subject to German legislation on stock corporations, specifically the German Stock Corporation Act[585]. - The supervisory board members are entitled to reimbursement of reasonable out-of-pocket expenses incurred in the performance of their duties[624]. - The company does not pay fees for attendance at supervisory board or committee meetings[624]. Management Board Composition and Compensation - The management board consists of two members, Francis Dufay (CEO) and Antoine Maillet-Mezeray (Executive Vice President, Finance & Operations), with terms ending on November 4, 2025[616]. - The supervisory board compensation system includes $125,000 per annum for ordinary members and $250,000 for the chairperson, with additional compensation for committee chairs[624]. - The chairperson of the audit committee receives an additional $90,000 per annum, while other audit committee members receive $75,000[624]. - The company reported a total compensation of $268,000 for Jonathan D. Klein, the chairperson, in 2024, reflecting a 93% increase from the previous year[625]. - Blaise Judja-Sato and Angela Kaya Mwanza received total compensations of $243,000 and $188,000 respectively in 2024, with increases of 52% and 67% from 2023[625]. - The target compensation for CEO Francis Dufay in 2024 is $1,094,000, which represents a 8.6% increase from $1,007,000 in 2023[633]. - The total target compensation for EVP Finance and Operations Antoine Maillet-Mezeray in 2024 is $1,093,000, up from $1,014,000 in 2023, indicating a 7.8% increase[633]. - The fixed compensation for Francis Dufay includes a base salary of $473,000, which is 43% of his total target compensation for 2024[633]. - The variable compensation for both management board members consists of short-term incentives of $279,000 and long-term incentives of $342,000 each[633]. - The management board members are required to acquire shares worth 100% of their annual gross base salary and hold them until the end of their appointment[646]. - The maximum compensation for each management board member is capped at €15 million per fiscal year[630]. - The company has implemented malus and clawback provisions in the service agreements, allowing for reduction or reclamation of compensation under certain conditions[644]. - No malus or clawback provisions were applied in fiscal year 2024[645]. - The total fixed compensation for Francis Dufay in 2024 is $473,000, which is 62% of his total compensation awarded[636]. - The total variable compensation awarded to Antoine Maillet-Mezeray in 2024 is $285,000, which is 38% of his total compensation awarded[636]. Employee Statistics and Compensation - As of December 31, 2024, the company employed a total of 2,163 employees, a decrease from 4,318 employees in 2022[677]. - The average remuneration per employee in 2024 increased to €19.7 thousand ($21.3 thousand) from €15.0 thousand ($16.2 thousand) in 2023[679]. - As of December 31, 2024, 52.9% of the workforce consisted of marketplace operations and management employees, followed by logistics employees at 40.4%[678]. - The company’s employee distribution by geography shows a significant decline in West Africa from 1,686 in 2022 to 892 in 2024[678]. - The company’s employee count in North Africa decreased from 1,498 in 2022 to 645 in 2024[678]. - The company’s employee count in East and South Africa decreased from 622 in 2022 to 320 in 2024[678]. - The company’s employee count in other regions decreased from 512 in 2022 to 306 in 2024[678]. Shareholding and Ownership - The company’s shareholding requirements were exceeded by Mr. Maillet-Mezeray and Mr. Dufay as of February 1, 2025[647]. - The company’s audit committee includes at least three members, with Anne Eriksson serving as the audit committee financial expert[668]. - Baillie Gifford & Co. holds 18,131,782 shares, representing 7.4% of the outstanding ordinary shares as of February 1, 2025[686]. - Pernod Ricard Deutschland GmbH owns 15,393,840 shares, accounting for 6.3% of the total shares[686]. - The total number of ADRs outstanding is 116,037,240, with underlying ordinary shares representing 94.8% of the total[687]. - Total beneficial ownership by all members of the supervisory and management boards is 1,079,532 shares, or 0.4% of the total[686]. Management Compensation Projections - Key management compensation for 2023 is projected at USD 5.3 million, increasing to USD 5.6 million in 2024[690]. - Short-term employee benefits for key management are expected to rise from USD 3.3 million in 2023 to USD 3.5 million in 2024[690]. - Share-based compensation for key management is anticipated to increase from USD 1.9 million in 2023 to USD 2.1 million in 2024[690]. Corporate Governance - The company does not have any arrangements that may result in a change of control[687]. - All shareholders have equal voting rights, with no different classes of shares[687]. - The company cannot determine the identity of its shareholders due to the bearer form of ordinary shares[687]. - The company issued its most recent annual compliance declaration on December 18, 2024, following its listing on the New York Stock Exchange in April 2019[674].

Company Information - Jumia Technologies AG filed its Annual Report 2024 on Form 20-F on March 7, 2025[4] - Francis Dufay serves as the Chief Executive Officer and Antoine Maillet-Mezeray as the Executive Vice President, Finance & Operations[9] Report Details - The report includes a press release as Exhibit 99.1, detailing the company's performance and future outlook[6]

Core Viewpoint - The article discusses the challenges of investing in Jumia Technologies (NYSE: JMIA), emphasizing the difficulty of believing in a business narrative that the market does not recognize or appreciate [1]. Group 1: Company Overview - Jumia Technologies is highlighted as a company that may present a unique investment opportunity despite market skepticism [1]. - The article references Dr. Duru, a seasoned market analyst with extensive experience in various market cycles, who provides alternative perspectives on financial markets [1]. Group 2: Analyst Background - Dr. Duru has a strong academic background, holding a B.S. in Mechanical Engineering and a Ph.D. in Engineering-Economic Systems from Stanford University [1]. - His professional experience includes independent consulting in operations research, management consulting in product development, and expertise in business intelligence and data analytics [1]. Group 3: Investment Philosophy - The article emphasizes the importance of understanding market extremes and challenges conventional market wisdom, suggesting that there are opportunities in overlooked narratives [1]. - Dr. Duru's blog, "One-Twenty Two," serves as a platform for sharing insights on various financial instruments, including stocks, options, and cryptocurrencies, utilizing both technical and fundamental analysis [1].