Jumia's $13.7 million cloud bill

Dramatic cost cuts at e-commerce giant

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Jumia is slashing costs

The media plays the same tune every time Jumia reports earnings: “Still bleeding, still not profitable.” It was dramatic in 2019, predictable in 2020, and in 2025, it’s just background noise.

After nearly six years of reporters trying to shock readers with numbers that no longer sting, it's time to admit that Jumia-fatigue is real. Investors have read the analyst reports beforehand and expect red ink. Readers tune it out. But the headlines keep coming.

Here’s what most outlets ran with after Jumia’s Q1 2025 earnings last week:

Jumia narrows losses to $16.5 million.
Jumia projects profitability in 2027.

You’d be forgiven for skipping the story entirely. But stay with me. As I listened to the company’s earnings call, it became clear that the narrow focus on top and bottom lines meant you missed some genuinely jaw-dropping bits: brutal cost cuts and layoffs, a cloud bill that could fund a seed round, and a quiet shift in Jumia’s power markets. The financials have been public for a week. No one’s touched this.

So let’s get the obligatory headline out of the way: Jumia says profitability is coming (again). This time, the magic number is 2027.

CEO Francis Dufay told investors:

“For 2026, we forecast a loss before income tax of $25 million to $30 million, and we believe we are on track to reach profitability on a loss before income tax basis in the fourth quarter, with full-year profitability targeted for 2027.”

If that sounds familiar, it’s because we’ve heard it before.

The Road to 2027 Is Paved With Missed Deadlines

After its buzzy 2019 New York Stock Exchange debut, Jumia’s co-CEOs, Sacha Poignonnec and Jeremy Hodara, confidently told shareholders they’d hit profitability by 2022. That promise was wobbly from the jump. Post-IPO results showed rising losses and cash burn.

However, by Q1 2020, the company claimed it was making “significant progress on the path to profitability.” In Q3, it said the path was becoming clearer. And by November 2020, Jumia was finally making a profit on each order after covering fulfillment and marketing costs.

Then came 2021, and with it, hubris. Jumia entered Growth Mode Pro Max. It poured cash into marketing and technology, driving record Gross Merchandise Value (GMV) but nearly doubling its operating losses. Profitability in 2022? Officially impossible.

“There is not a silver bullet that will suddenly make Jumia profitable.”
— Sacha Poignonnec, Q2 2022 earnings call.

By November 2022, the board had seen enough. Both CEOs were out.

Now, Francis Dufay has a timeline of his own: Q4 2026 for breakeven. Full-year profitability in 2027.

Two years away. A lot has to go right for it to happen. Act 1 is ridiculous cost-cutting.

A Company Cutting Costs Like Its Life Depends On It

And maybe it does. Jumia ended Q1 2025 with $110.7 million in liquidity—$61.6 million in cash and $49.1 million in term deposits. Against that, it’s projecting a $50–55 million loss this year, and a $30 million loss next year.

That math speaks for itself. So Jumia is swinging the axe.

Let’s walk through some of the cuts:

• Headcount: More layoffs. “Since the beginning of the year through the end of April, we have already reduced our total headcount by about 3%,” Dufay said on the earnings call. The company’s last reported layoffs were in February 2024.

• Hiring freeze: Jumia has implemented a “highly restrictive hiring policy” that will remain in place through 2025.

The most jaw-dropping stat is buried in a paragraph about infrastructure:

“Regarding hosting costs, we have a yearly contractual commitment of $13.7 million in 2024, whereas our current 12-month commitment is now reduced to only $10 million, without limiting our growth potential.”

Yep, you read that right.

Jumia spent $13.7 million on cloud hosting in 2024, after cost-cutting had already begun. Even at $10 million, the bill for 2025 is staggering. The next time your startup CEO complains about the AWS bill, show them this newsletter. You are not alone. Your bill is just… smaller.

Temu is eating Jumia’s lunch

I’ve used Temu and AliExpress more times this year than I’ve thought about opening Jumia. Apparently, I’m not alone.

Here’s Jumia, admitting as much:

“Non-resident platforms, such as Temu and Shein, have been making moves in selected African markets. We acknowledge the low prices and vast assortment, making them very worthy competitors.”

In response, Jumia is sourcing more low-cost goods from Chinese vendors, using its efficient logistics network and unlike Temu, offers payment on delivery.

The numbers suggest the response is working.

“In Q1, we sourced 2.6 million gross items internationally… a 61% year-over-year increase.”

Can’t help but wonder though, can Jumia out-China China?

A Rare Glimpse Into Market Performance

One useful stat buried in the report: Jumia has started disclosing GMV by country. Ivory Coast now leads the pack with 26% of GMV, ahead of Nigeria (22%), Kenya (15%), and Egypt (10%).

Also some Q1 numbers

• Revenue: $36.3 million

• GMV: $161.7 million

• Active customers: 2.1 million

The markets reacted positively to Jumia’s new timeline and cost cuts, with its share price jumping to $3.55 last week and closing at $3.21 on Friday. At a market capitalisation of $393 million, it’s still far off from the early days.

Let’s move on to retail.

*Retail Math Isn’t That Simple

A recent Nairametrics report ranked Nigeria’s supermarket chains by number of stores, crowning relative newcomer Bokku! Mart as the country’s largest by footprint, with 123 outlets. It’s easy to see why a list like that travels fast and hogs headlines: big numbers suggest big wins. But is store count the best way to measure retail strength?

The report, based on data from each chain’s website, placed Addide in second with 44 stores, followed by MarketSquare, Justrite, and Shoprite with between 23 and 36 locations each. It’s a tidy way to visualize growth, but the retail business is rarely tidy.

Some chains have gone all in on expansion: over 100 outlets, tight footprints, fast moves. Others have grown more deliberately, with fewer stores but a wider geographic reach. If one brand has 30 stores across 15 cities and another has 120 in a single region, which one is building national access?

And beyond geography, what happens when you step inside these stores? Many of the fastest-growing outlets are small-format, less than 200 square meters. They’re quick to deploy but come with trade-offs: limited inventory, cramped aisles, and a tendency to reduce grocery shopping to the bare essentials. When price is the main attraction, the experience can quietly suffer. The choices that keep prices low (no chilled drinks, little in-store assistance) can also flatten the shopping experience.

Larger-format stores offer a different kind of promise. They trade scale for substance: more SKUs, fresher baked goods, roomier layouts, and a better shot at turning a grocery run into a one-stop errand. And when that format scales across cities, not just states, it becomes a different kind of retail muscle; one built on operational reach, not just physical saturation.

One national chain, for example, serves cities as wide-ranging as Uyo, Asaba, Kaduna, and Yenagoa with just over 30 stores; another, with more than triple that number, rarely ventures outside its base.

That contrast matters. A map tells a more nuanced story than a bar chart.

It’s also why MarketSquare (named this week on the FT’s list of Africa’s fastest growing companies) deserves a closer look. With around 25 stores spread across more than 20 cities, its footprint is surprisingly wide for a chain of its size. Rather than chasing volume, MarketSquare has focused on presence in state capitals and tier-two cities, many of which are underserved by modern retail. It’s a slower build, but a strategically sound one.

What also sets MarketSquare apart is its commitment to full-service formats. In a landscape tilting toward quick convenience, it has leaned into depth: more products per store, better in-store presentation, and a shopping experience that doesn’t just prioritize price but also comfort and consistency. The result isn’t flashy; it’s quietly effective, and likely more defensible over time.

Even store count, while useful, can be misleading. Several chains have learned the hard way that aggressive growth without sustainability is a costly lesson. Expansion is only half the battle. Staying power comes from repeatable operations, consistent customer experience, and financial discipline.

So no, this isn’t about writing off store count. It’s a meaningful metric, but on its own, it’s incomplete. Real leadership in Nigerian retail will come from the chains that get distribution, experience, and scale right, not just those that appear most frequently on Google Maps.

Presence is one thing. Penetration, quality, and staying power are something else entirely.

*This is collaborative sponsored content.

That’s it for this week. See you next Friday!

Want to sponsor or work with Notadeepdive? Email me: olumuyiwa@notadeepdive.com