Jumia Technologies AG

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Jumia's results conference call for the second quarter of 2023. At this time, all participants are in a listen-only mode. And after management's prepared remarks, there will be a question and answer session. I would now like to turn the call over to Safa Demir, Head of Investor Relations for Jumia. Please go ahead.

Thank you. Good morning, everyone. Thank you for joining us today for our second quarter 2023 earnings call. With us today are Francis Duffet, CEO of Jumia, and Antoine Maillet-Mézeret, Executive Vice President, Finance and Operations. We will start by covering the safe harbor. We would like to remind you that our discussions today will include forward-looking statements. Actual results may differ materially from those indicated in the forward-looking statements. Moreover, these forward-looking statements may speak only to our expectations as of today. We undertake no obligation to publicly update or revise these statements. For a discussion of some of the risk factors that could cause actual results to differ from the forward-looking statements expressed today, please see the risk factors section of our annual report on Form 20-F as published on May 16, 2023. as well as our other submissions with the SEC. In addition, on this call, we refer to certain financial measures not reported in accordance with IFRS. You can find reconciliations of these non-IFRS financial measures to the corresponding IFRS financial measures in our earnings press release, which is available on our investor relations website. With that, I'll hand over to Francis.

Thank you, Safa. Welcome, everyone. Thanks for joining us today. I am pleased to report another quarter of significant reduction in losses as we execute on our strategy with discipline and focus. Q2-23 was the fourth consecutive quarter of loss reduction on a year-over-year basis with a material acceleration in the pace of loss reduction. In Q2-23, we cut both adjusted EBITDA and operating losses by two-thirds, reaching the lowest levels in over four years. This was achieved thanks to significant savings across the full cost structure. We cut our operating expenses by almost half in Q223 compared to Q222. We are reaching record levels of efficiency, particularly in fulfillment and sales and advertising expenses, while improving our customer value proposition. And that's a very important point. We are not driving cost savings at the expense of our standards of operation. We are operating more efficiently with a leaner cost structure while improving the quality of our supply, expanding our logistics reach, and providing our customers and sellers with a better value proposition overall. Having successfully right-sized our cost base, our top priority is now growth. And here, we are taking no shortcuts to drive growth. We are doing the heavy lifting on fundamentals to build what we believe to be a sustainable foundation for long-term profitable growth at Jumia. We are now in the middle of this transition, with the added complexity of a very challenging macro environment, which is heavily affecting usage performance.