Jumia(JMIA) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - In Q4 2025, revenue reached $61.4 million, up 34% year-over-year, or up 24% on a constant currency basis [21] - Adjusted EBITDA loss narrowed to $7.3 million from $13.3 million in the prior year quarter [10] - Loss before income tax was $9.7 million, a 45% decrease year-over-year [11] - Quarterly cash burn declined to $4.7 million in Q4 2025 compared to $15.8 million in Q3 2025 [11] Business Line Data and Key Metrics Changes - Physical goods GMV grew 38% year-over-year, adjusted for perimeter effects [6] - Adjusted for perimeter effects, physical goods orders grew 32% year-over-year [8] - First-party sales represented 49% of total revenue, supported by international partnerships [9] - Average order value for physical goods increased to $37 from $35 in Q4 2024 [9] Market Data and Key Metrics Changes - Nigeria's physical goods GMV increased 50% year-over-year, while physical goods orders grew 33% [14] - Kenya's physical goods orders were up 50% year-over-year, with GMV increasing 48% [15] - Ghana delivered exceptional growth, with physical goods orders up 82% year-over-year and GMV increasing 124% [16] - Egypt's physical goods orders increased 23% year-over-year, while GMV grew 2% [15] Company Strategy and Development Direction - The company aims to achieve adjusted EBITDA break-even and positive cash flow in Q4 2026, with full-year profitability in 2027 [30] - Focus on expanding product assortment and improving availability and affordability to drive higher conversion rates [19] - Plans to enhance marketing efforts, particularly in under-penetrated online channels [19] - The company will exit Algeria to simplify operations and focus on markets with stronger growth potential [31] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding macroeconomic stability in Africa, with stable currencies aiding business operations [51] - The company anticipates continued growth in 2026, driven by improved assortment and market coverage [33] - Regulatory scrutiny on non-resident platforms is increasing, contributing to a more level playing field [18] Other Important Information - The company opened a new office in Yiwu, China, to enhance sourcing capabilities [12] - Headcount declined by 7% in 2025, indicating a more efficient organization [10] - Fulfillment cost per order improved to $1.97, a 12% year-over-year reduction [10] Q&A Session Summary Question: What are the main drivers for acceleration in 2026? - Management identified assortment, market coverage, and improved marketing investments as key drivers for growth in 2026 [33][35] Question: How does the company view capacity for future growth? - Management believes current fulfillment capacity is sufficient until at least the end of 2026, with no major capital expenditures expected [36][37] Question: What is the outlook for advertising revenue? - Management aims to increase advertising revenue from 1% of GMV to closer to 2% over the medium term, with ongoing improvements in monetization strategies [70][72] Question: How does the company assess competition? - Management noted a rational competitive environment, with some softening from international competitors and a strong position against local platforms [76][77]