Jumia’s revenue rises by 42.5% in Q2 of 2022 as orders reached 10.3m

Pan-African e-commerce platform, active across 11 countries in the continent, Jumia (NYSE: JMIA) reported its second-quarter financial performance, stating that its revenue rose to 42.5%, 2.3% more than in 2021 – 40.2%.

In the wake of the report, Jumia’s shares rose, gaining more than 18.58% in early trading to $8.20 per share at the time of publication.

Jumia’s consumer index

Quarterly Active Consumers – unique consumers who placed an order for a product or a service on Jumia within the review period, irrespective of cancellations or returns – (April – June) reached 3.4 million, up 24.9% year-over-year, supported by continued momentum in both customer acquisition and repurchase.

The average 90-day repurchase rate of the cohort of new consumers acquired in the first quarter of 2022 reached 44%, compared to 38% for the first quarter of the 2021 cohort.

Jumia recorded 28 million unique visitors on the platform, up 15% year-over-year.

Order index

Orders reached 10.3 million, up 35% year-over-year. In 2021, that number was 7.6 million. Compared to the first quarter of 2021, the business recorded double-digit growth in orders, GMV and revenue in Q1 2022. 

Orders grew in Q1 2022 by 40% year-over-year from 6.6 million to 9.3 million.

Gross Merchandise Value (GMV) also jumped by 27% year-over-year from $198.9 million to $252.7 million. And Jumia’s revenue reached $47.6 million, a 44% rise from Q1 2021’s revenue of $33 million. 

GMV is the total value of orders for products and services, including shipping fees, value added tax, and before deductions of any discounts or vouchers, irrespective of cancellations or returns for the relevant period.

The fastest growing category in terms of items sold was FMCG, which increased by 95% year-over-year, supported by the momentum of the grocery sub-category.

The second fastest growing category in items sold was Food Delivery, which maintained very strong momentum, growing by 67% year-over-year.

Food Delivery was the second-largest category in items sold after Fashion, accounting for 17% of items sold in the second quarter of 2022, compared to 14% in the second quarter of 2021.

Jumia recorded an increase in growth in the Phones and Electronics categories, as items sold across these two categories were up 25% year-over-year in the second quarter of 2022, compared to 19% and 10% in the first quarter of 2022 and the fourth quarter of 2021, respectively.

“People are seeing inflation and facing price increases. And certainly, the fact that we offer those categories makes us attractive and relevant to the consumer. The positioning of the everyday product is a big driver for us and what is fueling growth is that consumers come back more often and buy multiple times,” Jumia co-CEO Sacha Poignonnec told TechCrunch.

Revenue index

Revenue reached $57.3 million in the second quarter of 2022, up 42% on a year-over-year basis and 56% on a constant currency basis.

Marketplace revenue – charges to the suppliers – reached $30.7 million in the second quarter of 2022, up 17% on a year-over-year basis, the fastest growth rate in the past seven quarters.

For H1 2022, marketplace revenue went up to $57.1 million, representing a 13% increase from 2021’s $50.5 million.

Value Added Services revenue reached $7.9 million, increasing by 32% year-over-year, partly as
a result of increased logistics revenue from local and international sellers.

Other revenue rose 50% year-over-year reaching $1.6 million, largely attributable to the strong momentum of the logistics-as-a-service offering, which generated over $1.0 million in the second quarter of 2022.

To support usage growth, we continue to deploy consumer incentives in the form of promotional discounts, which are accounted for as revenue deductions. Strategic use of consumer incentives on selected products or categories helps us drive conversion and is a core part of our strategy to scale the business towards profitability.

Jumia

Gross profit reached $30.4 million in the second quarter of 2022, up 14% year-over-year, the fastest growth rate in the past five quarters, supported by the marketplace revenue growth.

For H1 2022, Jumia’s revenue reached $104.9 million, representing a 43.3% increase from H1 2021, which was $73.2 million.

This indicates that the company has taken advantage of its post-pandemic momentum despite the challenge of currency devaluations in Africa.

We remain focused on scaling the business towards profitability. In the second quarter of 2022, we have successfully delivered on each building block of our path to profitability: usage growth momentum, monetisation acceleration and cost discipline.

Jumia

This is why Jumia plans to cut down, by at least 18%, the $55 million Sales and Advertising expense for July-to-December 2021, as it earmarks between $35 million and $45 million on Sales & Advertising in H2 2022.

Sales and Advertising expenses reached $22.2 million in Q2 2022, up 30% year-over-year and 36% on a constant currency basis. 45% of the Sales & Advertising expense was allocated to offline media and video advertising, 42% to online marketing campaigns, and 13% to staff costs.

The Sales & Advertising expense in H1 2022 reached $41.0 million.

The company expects $75-85 million in gross profit in H2 2022. This would be at least 27% more than the same period last year. It also expects GMV growth of at least 15% for the full year 2022 compared to the full year 2021.

Jumia also reported an increase in JumiaPay Transactions which reached 3.4 million in Q1 2022, increasing by 25% year-over-year, supported by accelerating volume growth across the business, in the Food Delivery category in particular.

33% of orders placed on Jumia in the second quarter of 2022 were completed using JumiaPay, compared to 35% in the second quarter of 2021.

Jumia

However, it was not all roses and pearls, as the operating loss was $67.7 million, up 31% year-over-year and 43% on a constant currency basis, as a result of operating expenses increase, partly offset by gross profit expansion.

Meanwhile, Jumia announced today, August 11, the launch of a quick commerce platform in Nigeria dubbed Jumia Food Mart to meet increased consumer demand for rapid delivery. The move will enable consumers to receive their online grocery orders in under 20 minutes.

According to Massimiliano Spalazzi, Jumia Nigeria CEO, the new service will enable Jumia to serve the growing population of young middle-class Nigerians.

“Consumer behaviour and lifestyles are changing with speed and convenience becoming more important than ever. We believe that Jumia’s quick commerce offering meets our consumers’ demand for the convenient, fast delivery of everyday products, especially in this post-COVID era,” he says.