AXIAN Telecom Buys 8% Stake in Jumia Amid Investor Exodus and Intensified eCommerce Pressure

AXIAN Telecom has taken an 8% minority stake in Jumia, signaling renewed investor confidence as the e-commerce giant battles financial losses and increased competition across Africa.

This strategic move could reshape Jumia’s fortunes, with AXIAN’s infrastructure offering potential lifelines in payments, logistics, and mobile commerce as the company fights to regain relevance in the digital market.

SEE ALSO: Baillie Gifford’s Big Exit Sends Shockwaves Through Jumia’s Boardroom

In a bold vote of confidence amid turbulent times for Africa’s e-commerce landscape, AXIAN Telecom has announced the acquisition of an 8% minority stake in Jumia Technologies AG. This development marks a significant milestone for both companies, particularly as Jumia navigates an increasingly challenging market environment characterized by heightened competition, financial strain, and shifting investor sentiment.

AXIAN Telecom, a prominent player in the African telecommunications sector, views this partnership as more than just a financial transaction. According to CEO Hassan Jaber, the investment aligns closely with AXIAN’s long-term vision of supporting the digital transformation of Africa. “We recognize the value Jumia has built in digital commerce and financial services through JumiaPay,” Jaber said in an official statement. “This collaboration reflects our shared goals of promoting economic and financial inclusion across the continent.”

A company at a crossroads

AXIAN’s move arrives at a time when Jumia’s operational health has come under scrutiny. Once heralded as Africa’s answer to Amazon, Jumia has seen its shine fade over recent years due to consistent losses, market exits, and eroding investor trust. The recent departure of Baillie Gifford, formerly one of Jumia’s largest institutional investors, has only intensified concerns about the company’s sustainability. The Edinburgh-based asset management firm previously held over 11% of Jumia’s shares but has now completely divested, reportedly suffering losses of up to 90% on its position.

Analysts suggest this exit may serve as a warning signal to other investors, especially given Baillie Gifford’s reputation for backing disruptive technology companies with long-term potential. Its retreat underscores broader apprehension about Jumia’s ability to execute a successful turnaround strategy.

Financial pressures mount

The e-commerce firm’s latest financial report paints a sobering picture. Jumia’s revenue for the first quarter of 2025 fell by 26% compared to the same period the previous year. This decline has reversed some of the gains made through earlier cost-cutting measures, including a sharp reduction in marketing expenditure and withdrawal from two key markets, South Africa and Tunisia. These measures, implemented under CEO Francis Dufay, were aimed at preserving cash and refocusing operations on core regions.

At present, Jumia operates in nine African countries and holds approximately $111 million in cash reserves. While this may seem sufficient in the short term, analysts caution that it might only sustain operations for another 18 to 24 months if the company does not achieve a meaningful financial turnaround.

Rising competition from global players

Jumia’s struggle for dominance in the African e-commerce sector is being further complicated by the aggressive expansion of global retailers like Shein and Temu. These companies, armed with vast resources and efficient global supply chains, are making significant inroads into African cities by offering lower prices and faster delivery times. This has placed additional pressure on Jumia to differentiate itself and enhance customer value.

To compete effectively, Jumia is now looking eastward. It has begun cultivating relationships with suppliers in China to lower procurement costs and improve inventory management. Moreover, the company has shifted some focus towards underserved secondary cities, where digital commerce is still gaining traction. Early indicators suggest these areas could provide a much-needed boost to order volumes and revenue diversification.

Potential for strategic integration

AXIAN Telecom’s entry into Jumia’s shareholder structure introduces a new dimension to the company’s recovery strategy. As an infrastructure-heavy telecom operator with operations across nine African countries, AXIAN brings assets that could significantly strengthen Jumia’s logistics and connectivity backbone. This opens possibilities for improved mobile commerce services, better integration of JumiaPay with telecom-based payment systems, and more reliable last-mile delivery networks in difficult-to-reach regions.

Such synergies could be instrumental in helping Jumia evolve its support services into true growth drivers. Specifically, the expansion of JumiaPay into a broader fintech solution and the optimization of its logistics arm could generate new revenue streams while improving operational efficiency.

However, AXIAN’s involvement also comes with inherent risks. Entering into a distressed business with an uncertain outlook is a gamble, especially in Africa’s volatile economic environment where consumer purchasing power remains fragile and digital infrastructure unevenly distributed.

Looking to the future

Despite the headwinds, Jumia’s leadership remains optimistic about the company’s future. CEO Francis Dufay has laid out an ambitious roadmap targeting break-even by 2026 and full profitability by 2027. Whether this timeline is achievable will largely depend on the company’s ability to execute effectively, particularly in driving down operational costs, expanding its user base, and leveraging technology to improve service delivery.

AXIAN’s support provides more than just a financial cushion. It brings with it a chance for Jumia to redefine its narrative, from one of missed opportunities and persistent losses to a new story centered on innovation, resilience, and regional integration.

The e-commerce market in Africa still holds vast potential, with millions of underserved consumers and growing smartphone penetration. If Jumia can successfully harness AXIAN’s infrastructure and deliver value beyond urban centers, it may yet reclaim its place as a pioneer in the African digital economy.

For now, the partnership represents a crucial turning point. Whether it serves as a springboard for Jumia’s recovery or becomes another costly detour will be revealed in the coming quarters. But one thing is clear: Jumia’s journey from survival to sustainability just gained a powerful ally.