Jumia(US:JMIA)2025-11-13 14:30Summary of Jumia Technologies Investor Day Company Overview - Company: Jumia Technologies (NYSE: JMIA) - Event: 2025 Investor Day - Date: November 13, 2025 Industry Insights - Market Size: The addressable e-commerce market in Africa is projected to reach $40 billion by 2029 across nine recovering markets [1] - Population Growth: Africa's population is expected to grow from 1.5 billion today to 2.5 billion by 2050, a 60% increase [2] - Low GDP per Capita: Average GDP per capita in the markets where Jumia operates is around $2,000 [2] - Internet Penetration: Internet access is improving, with penetration expected to rise from 14% to 38% over the next decade [3] Core Business Model and Strategy - Unique Business Model: Jumia is focused on creating a business model tailored to the unique challenges of the African market rather than copying models from other regions [1] - Marketplace Flywheel: The company aims to create a positive feedback loop where increased demand leads to more sales, attracting more vendors and brands, which in turn generates more sales [5] - Focus on Lower Middle Class: Jumia targets the lower middle class in Africa, defined as individuals earning between $150 and $500 per month, which represents a significant portion of the population [42][44] Operational Changes and Restructuring - Restructuring Phase: Jumia underwent a significant restructuring starting in late 2022, focusing on cost management and rebuilding its value proposition [18] - Staff Reduction: The company reduced its workforce from 4,500 to 2,000 employees to streamline operations and cut costs [23] - Fulfillment Cost Reduction: Fulfillment costs per order decreased from $3.4 to $1.9, a reduction of nearly 50% [33][55] - Marketing Budget Cuts: Marketing expenses were reduced by 75%, from $15 million to $3 million [36][55] Financial Performance - Operating Loss: Operating losses decreased from $200 million to $70 million [55] - Cash Burn: Cash burn reduced from nearly $300 million in 2022 to $82 million [55] - Contribution Margin: Contribution margin per order improved from $1.9 to $2.3 [55] Market Challenges - Unique Challenges: The African e-commerce market faces challenges such as low disposable income, fragmented markets, immature logistics, and varying shopping behaviors across regions [11][12] - Trust Issues: There are significant trust issues among consumers regarding online transactions, which Jumia aims to address through improved operations and customer engagement [12] Future Outlook - Path to Profitability: Jumia aims to achieve breakeven by 2027, focusing on sustainable growth and improved unit economics [41][55] - Expansion Plans: The company is expanding its logistics network to cover more remote areas, increasing accessibility for underserved populations [52] Key Performance Indicators (KPIs) - Repurchase Rate: The 90-day repurchase rate for new customers increased from 39% to 43% over three years [47] - Customer Satisfaction: Net promoter score improved from 46 to 64, indicating higher customer satisfaction [48] Conclusion - Strategic Positioning: Jumia believes it is well-positioned to capitalize on the growing e-commerce market in Africa, with a unique business model and a focus on affordability and accessibility for the lower middle class [8][10]