Jumia held its first post-IPO earnings call and weathered a short-sell assault in May, with Wall Street showing confidence in the Pan-African e-commerce company.
On the numbers, key takeaways were that Jumia’s Gross Merchandise Value (GMV) — the total amount of goods sold over the period — grew by 58% to €240 million. Marketplace revenue grew 102% to €16 million, and gross profits as a percentage of GMV grew by 6.5% in Q1 2019.
Overall, Jumia’s operating losses for the period widened to €45.4 million from €34.3, and negative EBITDA increased to €39.5 million from €30.2.
So the startup’s still losing money — see the big losses reported in the IPO filing — but is improving its ability to earn.
CEO Sacha Poignonnec also shared a longer-term revenue strategy on Jumia’s Q1 earnings call. The startup plans to convert its JumiaPay and Jumia Logistics capabilities to standalone services across Africa.
Founded in Lagos in 2012, the company currently operates multiple online verticals in 14 African countries — from B2C consumer retail to travel bookings.
For Jumia, going public has been an up and down affair. After becoming the first tech startup operating in Africa to list on a major exchange (the NYSE in April), the company saw its share rise 70% after listing on the NYSE in April at $14.50.
Then in May, Jumia’s stock tumbled when it came under assault from a short-seller, Andrew Left, who accused the company of fraud. On the earnings call the startup’s CEO responded to the short-seller claims saying, “Jumia stands by our prospectus and audited financials…and will not be distracted by those who look…to profit at our expense.” Poignonnec later took to media and refuted claims as “market rumors rather than facts.”
Citibank analyst Andrew Howell published his own response, much of it discrediting Citron Research.
Overall, Wall Street seemed confident in Jumia’s post-IPO results and outreach, with Raymond James and Berenberg upgrading their Jumia stock recommendations to buy-equivalent ratings. Jumia’s stock has remained stable since, closing at $25.81 Monday.