Q2 2024 Jumia Technologies AG Earnings Call
Yes.
[music].
Operator: Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Jumia's results conference call for the second quarter of 2024.
Operator: Good morning, ladies and gentlemen. Thank you for standing by.
Speaker Change: Good morning, ladies and gentlemen, thank you for standing by welcome to <unk> results Conference call for the second quarter of 2024.
Operator: Welcome to Jumia's Results Conference Call for the second quarter of 2024. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question and answer session. With us today are Francis Dufay, CEO of Jumia, and Antoine Maillet-Mizeray, Executive Vice President, Finance and Operations.
Operator: At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question-and-answer session.
Speaker Change: At this time all participants are in a listen only mode.
Speaker Change: After managements prepared remarks, there will be a question and answer session.
Operator: With us today, are Francis Dufay, CEO of Jumia, and Antoine Maillet, Miseray, Executive Vice President, Finance, and Operations.
Speaker Change: With us today are Francis to Fe, CEO of Julia and Antoine Maillet, Missouri, Executive Vice President Finance and operations.
Operator: We'll 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.
Operator: We'll start by covering the safe harbor. But 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 statement. 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 Factor section of our annual report on Form 20-F as published on March 28, 2024, as well as our other filings with the SEC.
Speaker Change: We'll start by covering the safe Harbor.
Operator: In addition, on this call, we will 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 it over to Francis.
Operator: 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 factor section of our annual report on Form 20-F as published on March 28th, 2024, as well as our other submissions with the SEC. In addition, on this call, we will refer to certain financial measures not reported in accordance with IFRS. You can find reconciliation of these non-IFRS financial measures to the corresponding IFRS financial measures and our earnings press release, which is available on our Investor Relations website.
Francis Dufay: With that, I'll hand it over to Francis. Good morning, everyone, and thank you for joining us today. I will begin with an overview of our performance during the second quarter, and we'll offer an update on our business and strategic objectives.
Francis Dufay: Good morning, everyone, and thank you for joining us today. I will begin with an overview of our performance during the second quarter and will offer an update on our business and strategic objectives. I will then turn the call over to Antoine for a more in-depth look at our financials, followed by Q&A. Building off of the momentum we saw in the first three months of the year, we delivered improvement in our usage KPIs in Q2-24, and continued taking a diligent approach to cost management while further strengthening cash efficiency.
Francis Dufay: I will then turn the call over to Antoine for a more in-depth look at our financials, followed by Q&A. Building off the momentum we saw in the first three months of the year, we delivered improvement in our usage KPI in Q224 and continued taking a diligent approach to cost management while further strengthening cash efficiency. As part of this, we continue to prioritize executing against our strategic initiatives and building healthy fundamentals. Importantly, our efforts are delivering results, and our progress is evident in our second quarter performance. In Q224, orders grew solid 6.9% year-over-year and increased 4.9% on a sequential basis.
Francis Dufay: As part of this, we continue to prioritize executing against our strategic initiatives and building a healthy fundamental foundation. Importantly, our efforts are delivering results, and our progress is evident in our second quarter performance. In Q2-24, orders grew a solid 6.9% year-over-year and increased 4.9% on a sequential basis. GMV in constant currency grew 35% year-over-year, driven by more efficient marketing spend and continued efforts to enhance our product assortment. GMV and USD did decline by 5% the overall year due to the impact of last quarter's devaluations in our two largest markets, Nigeria and Egypt. Devaluations also impacted top-line revenue, which declined 17.2% year-over-year in the quarter.
Francis Dufay: GMV in constant currency grew 35% year-over-year, driven by more efficient marketing spend and continued efforts to enhance our product assortment. GMV in USD declined by 5% year-over-year due to the impact of last quarter's devaluations in our two largest markets, Najaya and Egypt. Devaluations also impacted top-line revenue, which declined 17.2% year-over-year in the quarter. However, we have seen some signs of stabilization in Egypt, along with a sharp reduction of the spread between the official and parallel market trade. More importantly, our ability to drive GMV growth in constant currency illustrates that our value proposition is working. This is even more evident at the country level.
Francis Dufay: However, we have seen some signs of stabilization in Egypt, along with a sharp reduction of the spread between the official and parallel market trades. More importantly, our ability to drive GMV growth in constant currency illustrates that our value proposition is working. This is even more evident at the country level.
Francis Dufay: In Q224, six of our countries delivered GMV growth, up from five in the first quarter. For example, in Ghana, GMV grew 115.4% year-over-year in constant currency, and was up 72.1% year-over-year in USD. The further validates that our strategy and value proposition are well suited to navigate the unique African market dynamics. All those per customer, excluding Jimia Pay, increased by 5.1% in Q224, while AOV for physical goods reached $39.2, down 7.1% year-over-year. The decline in AOV is attributable to a shift in category mix this quarter. In Q224, a greater proportion of our sales volumes came from fashion, a lower AOV category, driven by improvements influencing from Chinese vendors.
Francis Dufay: In Q2-24, six of our countries delivered GM V-Grooves, up from five in the first quarter. For example, in Ghana, GMV grew 116.4% year-over-year in constant currency and was up 72.1% year-over-year in USD. This further validates that our strategy and value proposition are well suited to navigate unique African market dynamics. Orders per customer, excluding JumiaPay, increased by 5.1% in Q2-24, while AOV for physical goods reached $39.2, down 7.1% year-over-year. The decline in AOV is attributable to a shift in category mix this quarter.
Speaker Change: But since you are in USD.
Speaker Change: This further validates that our strategy and value proposition are well suited to navigate unique African market dynamics.
Speaker Change: Orders per customer, excluding Jimmy I paid increased by five 1% in Q2 24, while the a O V for physical goods reached 39.2 dollars down seven 1% year over year.
Speaker Change: The decline in <unk> is attributable to a shift in category mix this quarter.
Francis Dufay: In Q224, a greater proportion of our sales volumes came from fashion, a lower AOV category driven by improvements in sourcing from Chinese vendors. We also experienced lower corporate sales in Egypt. As a reminder, we do not aim for a specific AOV, as we rather strive to provide the best value proposition in each of our priority categories, which include phones, electronics, home and living, fashion, and design. Quarterly active customers improved a solid 6% quarter over quarter in Q2'24 and were flat year over year, which is an important milestone for Jumia. We believe that the improvement in active customers positions us to focus on reintegrating Jumia's customer growth. As we noted last quarter...
Speaker Change: In Q2, 'twenty for a greater proportion of all sales volumes came from fashion.
Speaker Change: Lower category driven by improvements in sourcing from Chinese vendors.
Francis Dufay: We also experienced lower corporate sales in Egypt. As a reminder, we did not aim for specific AOV, as we rather strive to provide the best value proposition in each of our priority categories, which include phones, electronics, common living, fashion, and beauty. Quarterly active customers improved the 36% quarter-over-quarter in Q224 and were flat year-over-year, which is an important milestone for Jumia. We believe that the improvement in active customers positions us to focus on reintegrating Jumia's customer growth. As we noted last quarter, continued marketing efficiency is helping us acquire what we believe to be a stickier and higher quality customer base.
Speaker Change: We also experienced lower corporate says in Egypt.
Speaker Change: As a reminder, we do not aim for specific acreage as we rather strive to provide the best value proposition in each of our priority categories, which include phones electronics home and living fashion and beauty.
Speaker Change: Quarterly active customers improve the solid 6% quarter over quarter in Q2, 'twenty four and were flat year over year, which is an important milestone for junior.
Speaker Change: We believe that the improvement in active customers positions us to focus on reinvigorating dramatic customer growth.
Speaker Change: As we noted last quarter.
Francis Dufay: Continued marketing efficiency is helping us acquire what we believe to be a stickier and higher quality customer base. Our 90-day repurchase rate for new customers improved 262 basis points in the first quarter of 2024 to 36% from 33% in the same period last year, further validating our strategy. Based on our previous successes in key markets, we believe that we can significantly improve our group average repurchase rate. For example, in Côte d'Ivoire, we have already implemented several tactics to strengthen the consumer value proposition, including providing an enhanced assortment of goods and services with a view to capturing and retaining more loyal customers. As a result, we achieved a 46% 90-day repurchase rate from Q1 2024 new customers.
Speaker Change: Continued marketing efficiencies, helping us acquire what we believe to be a stickier and a higher quality customer base.
Francis Dufay: Our 90-day repurchase rate for new customers improved 262 basis points in the first quarter of Q224, to 36% from 33% in the same period last year, further validating our strategy. Based on our previous successes in key markets, we believe that we can significantly improve our group average repurchase rate. For example, in Côte d'Ivoire, we have already implemented several tactics to strengthen the consumer value proposition, including providing an enhanced assortment of goods and services with a view to capturing and retaining more loyal customers. As a result, we achieved a 46% 90-day repurchase rate from Q124 new customers.
Francis Dufay: As we expanded efforts across all of our markets, we expect to see group-level repurchase rates improve. Building on this momentum, discipline cost management combined with recent reductions in finance costs reduced our quarterly cash burn from 19.1 million dollars in Q124 to 8.7 million dollars in Q224. Last before income tax also decreased to 22.5 million dollars, versus a loss of 30.9 million dollars a year ago and a loss of 39.6 million dollars last quarter. Given by cost reductions and reductions in effects related finance costs as well as our cash repatriation. Adjusted EBDL loss, which excludes finance costs, decreased to 16.3 million dollars in line with the reduction in the operating loss and driven primarily by cost saving initiatives.
Francis Dufay: As we expand these efforts across all of our markets, we expect to see group-level repurchase rates in... Building on this momentum, disciplined cost management combined with recent reductions in finance costs reduced our quarterly cash burn from $19.1 million in Q1'24 to $8.7 million in Q2'24. Loss before income tax also decreased to $22.5 million, versus a loss of $30.9 million a year ago and a loss of $39.6 million last quarter, driven by cost reductions and reductions in FX-related finance costs as well as our cash repatriation.
Francis Dufay: Adjusted EBITDA loss, which excludes finance costs, decreased to $16.3 million, in line with the reduction in the operating loss and driven primarily by cost-saving initiatives. Loss before income tax includes finance costs, such as the impact of FX and the cost of cash repatriation.
Francis Dufay: Last before income tax includes finance costs such as the impact of effects and cost of cash repatriation.
Francis Dufay: Antoine will discuss this in more detail in a moment. Ultimately, we are seeing a nice momentum in the business, supported by an acceleration in the improvement of several of our usage trends. Our success is attributable to continued execution against our strategic initiatives.
Francis Dufay: Antoine will discuss this in more detail in a moment. Ultimately, we are seeing nice momentum in the business. Supported by an acceleration in the improvement of several of our usage trends, our success is attributable to continued execution against our strategic needs. As a reminder, our strategy is focused around three key pillars. First... Refocusing and recommitting to the African e-commerce market. Second, improving cash efficiency. And third, building a stronger consumer value proposition tailored to the needs and purchasing power of Africans.
Francis Dufay: At the reminder, our strategy is focused around three key pillars. First, refocusing and recommitting to the African ecommerce market. Second, improving cash efficiency. And third, building a stronger consumer value proposition tailored to the needs and purchasing power of the African consumers. Turning to our first objective, the team has done a good job simplifying Jumia's operations and strengthening our core business. This includes the work we've done to streamline our operations throughout the entire business. We are now focused on accelerating Jumia's growth through our remaining two pillars. The first of those two remaining pillars is a commitment to improve cash efficiency.
Francis Dufay: Turning to our first objective, the team has done a good job simplifying Jumia's operations and strengthening our core business model. This includes the work we've done to streamline our operations throughout the entire business. We are now focused on accelerating Jumia's growth through our remaining two pillars. The first of those two remaining pillars is a commitment to improve cash efficiency.
Francis Dufay: In Q2-24, we continue to make strides managing our core structure, expanding our asset-light logistics network, and taking a disciplined approach to marketing spend. As a reminder, our vast logistics network serves as a powerful enabler for our e-commerce platform. During the quarter, we opened two new warehouses, one in Nigeria and another in Morocco, to further consolidate operations, expand storage capacity, improve productivity, and enhance our supply chain management capabilities. Additionally, we expect to open new warehouses in Egypt and Cote d'Ivoire in the coming weeks.
Francis Dufay: In Q224, we continue to make strides managing our cost structure, expanding our asset-like logistics network, and taking a disciplined approach to marketing spend. As a reminder, our vast logistics network serves as a powerful enabler for our eCommerce platform. During the Q224, we open two new warehouses, one in Nigeria and another in Morocco, to further consolidate operations, expand storage capacities, improve productivity, and enhance our supply chain management capabilities. Additionally, we expect to open new warehouses in Egypt and could devour in the coming weeks. We believe that these strategic moves position Jumia to capture greater efficiency in each respective market and lay the foundation for growth at scale as we accelerate our expansion.
Francis Dufay: We believe that these strategic moves... position Jumia to capture greater efficiency in each respective market and lay the foundation for growth at scale as we accelerate our expansion. More importantly, as a key part of our asset life strategy, these warehouses are rented, not owned, which limits the impact on our balance sheet. Jumia's vast logistics network is made up of third-party logistics providers, local entrepreneurs, as well as a network of local pick-up stations.
Francis Dufay: More importantly, as a key part of our asset-like strategy, these warehouses are rented, not owned, which limits the impact on our balance sheet. Jumia's vast logistics network is made up of third-party logistics providers, local entrepreneurs, as well as a network of local picket stations. This network is vital to Jumia's growth and our ability to efficiently scale and deliver packages safely and with expanding geographic reach. Our logistics partners are proprietors and operate their own businesses, including managing the trucks, vehicles, and picket stations, and the human capital. The entire network is tracked and managed through Jumia's proprietary technology platform.
Francis Dufay: This network is vital to Jumia's growth and our ability to efficiently scale and deliver packages safely and with an expanding geographic reach. Our logistics partners are proprietors and operate their own businesses, including managing the trucks, vehicles, and pickup stations, and the human capital. The entire network is tracked and managed through Jumia's proprietary technology platform.
Speaker Change: It's Virginia as appropriate as a REIT technology platform.
Francis Dufay: Under this model, we can scale and grow the network with relatively low incremental investment, while ensuring low operating costs thanks to healthy competition within our ecosystem. It also serves as a strong competitive advantage, as Jumia provides these partners with large, reliable volumes in their local markets and the necessary management tools to empower their growth. Continued discipline around our logistics network delivers reductions in fulfillment expenses as a percentage of GMV from 5.9% in Q223 to 5.5% this quarter. Full-filment expense per order, excluding Jumia Pay app orders, was $2.17, versus $2.58 in the same quarter last year.
Francis Dufay: Under this model, we can scale and grow the network with relatively low incremental investment while ensuring low operating costs thanks to healthy competition within our ecosystem. It also serves as a strong competitive advantage, as Jumia provides its partners with large, reliable volumes in their local markets and the necessary management tools to empower their growth. Continued discipline around our logistics network delivered reductions in fulfillment expenses as a percentage of GMV from 5.9% in Q2'23 to 5.5% this quarter.
Speaker Change: Under this model, we can scale and grow the network with related to the low incremental investments, while ensuring low operating costs thing too thanks to healthy competition within our ecosystem.
Speaker Change: It also serves as a strong competitive advantage as it provides us partners with large reliable volumes in their local markets and the necessary management tools to empower take off.
Speaker Change: Continued discipline around our logistics network delivers the predictions and fulfillment expenses as a percentage of G. M. P from five 9% in Q2 'twenty three to five 5% this quarter.
Francis Dufay: Fulfillment expense per order, excluding JumiaPay app orders, was $2.17 versus $2.58 in the same quarter last year. We have successfully reduced delivery costs per order while expanding our network in smaller cities due to strong gains in productivity, as well as appropriately adjusting service levels to local demand from a cash management standpoint. Currency devaluations played a far less impactful role in the second quarter.
Speaker Change: Fulfillment expenses per order, excluding Jimmy I pay App orders was $217 versus $2 $58 in the same quarter last year.
Francis Dufay: We have successfully reduced delivery cost per order, while expanding our network in smaller cities due to strong gains in productivity, as well as appropriately adjusting service levels to local demand. From a cash management standpoint, currency contributed to lower finance and FIS costs and led to a lower net loss. We also maintain 67% of our cash balance in US dollars in the quarter and continue to introduce further efficiencies in our repatriation strategy. Beyond logistics and cash management, efficient and optimized marketing spend remains key to managing all-class base. Year over year, spend was still down 19% relative to Q223.
Speaker Change: We have successfully reduced delivery cost per order, while expanding our network in smaller cities due to strong gains in productivity as well as appropriately adjusting service levels to local demands.
Speaker Change: From a cash management standpoint.
Speaker Change: Currency devaluations play far less impactful role in the second quarter.
Speaker Change: This contributed to lower finance and FX costs and lead to a lower net loss.
Francis Dufay: This contributed to lower finance and FX costs and led to a lower net loss. We also maintained 67% of our cash balance in U.S. dollars in the quarter and continued to introduce further efficiencies in our repatriation strategy. Beyond logistics and cash management, efficient and optimized marketing spend remains key to managing our cost base year over year.
Francis Dufay: Band was still down 19% relative to Q220, but we modestly increased marketing spend by 18.2%, quarter-over-quarter, to $4.4 million in Q2-24 to support Jumia's anniversary sale, our second-largest commercial event of the year. We feel confident that we have a deeper appreciation of the most efficient channels, such as SEO, CRM, as well as localized offline marketing channels, and we are leaning more heavily into these areas given our early success. Finally, our last strategic objective is a commitment to building a strong value proposition.
Francis Dufay: We modestly increased marketing spend by 18.2% per order over quarter to $4.4 million in Q224 to support Jumia's anniversary sale, our second largest commercial event of the year. We feel confident that we have a deeper appreciation of the most efficient channels, such as SEO, CRM, as well as localized offline marketing channels, and we are leaning more heavily into these areas given our early success.
Francis Dufay: Finally, our last strategic objective is a commitment to building a strong value proposition. We've mentioned before that building the right value proposition is imperative to our growth. The African consumer is incredibly cost-conscious and will always look for the best possible price online offline, so having the right supply at the right price is essential. No amount of marketing will make up for it if we do not, which is why we continue to focus on building what we believe to be the right supply through work with both local African and international vendors and brands. For example, to improve sourcing from Chinese vendors, we have expanded our team in China, bringing our office headcount in Chenzhen by 21% over year, and are looking to open new sourcing offices across the country.
Francis Dufay: We've mentioned before that building the right value proposition is imperative to our growth. The African consumer is incredibly cost-conscious and will always look for the best possible price, online or offline, so having the right supply at the right price is essential.
Francis Dufay: No amount of marketing will make up for it if we do not, which is why we continue to focus on building what we believe to be the right supply through working with both local African and international vendors and brands. For example, to improve sourcing from Chinese vendors, we have expanded our team in China, growing our office headcount in Shenzhen by 21% year-over-year, and are looking to open new sourcing offices across the country. Beyond creating the right supply, our JumiaPay platform is key to building the right value proposition and enabling e-commerce by providing a variety of cashless payments and buy-now-pay-later options through outside credit partners. This quarter.
Francis Dufay: Beyond creating the right supply, our Jumia Pay platform is key to building the right value proposition and enabling e-commerce by providing a variety of cashless payments and by now pay later options through outside credit partners. This quarter, we also announced two new BNPL partnerships in Nigeria, bringing total BNPL services to six. While the offering is still in its intensity, we are seeing promising signs of adoption and look forward to sharing more detail on our progress. In addition, to creating our supply, expanding beyond capital cities is key to Jumia's value proposition. Smaller cities are a major opportunity for growth and acceleration because supply is even more underserved than in capital cities.
Francis Dufay: We also announced two new BNPL partnerships in Nigeria, bringing total BNPL services to 6 million. While the offering is still in its infancy, we are seeing promising signs of adoption and look forward to sharing more details on our progress. In addition to creating our supply, expanding beyond capital cities is key to Jumia's value proposition. Smaller cities are a major opportunity for growth and acceleration because supply is even more underserved than capital cities.
Francis Dufay: Jumia can provide the variety and choice that customers in more rural areas are looking for, and our logistics network enables us to deliver efficiently. The mix of orders in secondary cities versus capital cities is now 53% compared to 48% lecture and 51% in the first quarter of 24. Of the orders placed in secondary cities, 73% were fulfilled through pick up stations, showing how important their artwork continues growth and acceleration. These pick up stations, owned by third party partners, cut down on fulfilment and delivery costs while offering a central location to increase customer engagement. This includes placing and receiving orders while also providing a space for consumers to ask questions and to educate them on our product assortment, pricing, and delivery components.
Francis Dufay: Jumia can provide the variety and choice that customers in more rural areas are looking for, and our logistics network enables us to deliver efficiently. The mix of orders in secondary cities versus capital cities is now 53%, compared to 48% last year and 51% in the first quarter of 2024. Of the orders placed in secondary cities, 73% were fulfilled through pick-up stations, showing how important they are to our continued growth and acceleration.
Francis Dufay: These pickup stations, owned by 3rd party partners, cut down on fulfillment and delivery costs while offering a central location to increase customer engagement. This includes placing and receiving orders, while also providing a space for consumers to ask questions and to educate them on our product assortment, pricing, and delivery components. This helps to further embed Jumia into the fabric of local communities, adds economic value, and builds trust, thus increasing the value proposition and convenience for consumers while keeping Jumia's costs low.
Francis Dufay: This helps to further embed Jumia into the fabric of local communities as economic value and build trust, thus increasing the value proposition and convenience for consumers while keeping Jumia's costs low. One of our top performing countries for secondary cities is Codivoir, where 65% of our orders were achieved outside of the capital city in the quarter, versus approximately 53% average at the group level. As we roll out our proven best practices across other countries, we are seeing positive results. For example, in Nigeria, the share of orders from outside of major cities such as Lagos and Abuja increased 413 basis points to approximately 50% versus Q223.
Francis Dufay: One of our top performing countries for secondary cities is Côte d'Ivoire, where 65% of our orders were achieved outside of the capital city in the quarter, versus approximately 53% average at the group level. As we roll out our proven best practices across other countries, we are seeing positive results. For example, in Nigeria, the share of orders from outside of major cities, such as Lagos and Abuja, increased 413 basis points to approximately 50% versus Q2-23.
Francis Dufay: Similarly, in Kenya, the share of orders outside of major cities such as Nairobi and Gionbu increased 564 basis points to approximately 54% versus Q223.
Francis Dufay: Similarly, in Kenya, the share of orders outside of major cities such as Nairobi and Kiambu increased 564 basis points to approximately 54% versus Q2 2020. Looking forward, we're excited and optimistic about Jumia's future. We are confident in our strategy, and we are committed to executing and accelerating growth in the future. We are proving with tangible results that we are well-positioned to scale and tap the massive demand in Africa while moving towards profitability. I will now turn things over to Antoine.
Francis Dufay: Looking forward, we are excited and optimistic about Jumia's future. We are confident in our strategy, and we are committed to executing and accelerating growth in the future. We are proving with tangible results that we are well positioned to scale and tap the massive demand in Africa while moving forward towards profitability.
Antoine Maillet: I will now turn things over to Anton.
Antoine Maillet: Thank you, Francis, and thank you very much for joining us today. I will now provide an in-depth look at our second quarter results. Starting with the top line, revenue was 36.5 million USD, down 17.2% year over year and up 15% on a constant currency basis. Market-based revenue was 20 million USD, down 10.1% year over year, or up 27.2% on a constant currency basis, primarily impacted by Nigeria's currency evaluation in the first quarter and partially upset by higher commissions. Diving a little deeper, while Nigeria's currency evaluation dampened revenue, we did see improvement across our revenue drivers in constant currency.
Antoine Maillet-Mizeray: Thank you, Francis, and thank you everyone for joining us today. I will now provide an in-depth look at our second quarter results. Starting with the top line, revenue was $36.5 million USD, down 17.2% year-over-year and up 15% on a constant currency basis. Market base revenue was $20 million USD, down 10.1% year-over-year or up 27.2% on a constant currency basis, primarily impacted by Nigeria's currency devaluation in the first quarter and partially offset by higher commissions.
Antoine Maillet-Mizeray: Diving a little deeper, while Nigeria's currency devaluation dampened revenue, we did see improvement across our revenue drivers in constant currency. Ready-Added Services was 3.6 million USD at 3.7% in currency. Fulfillment revenues were 3.8 million USD, up 14.1% in constant currency. And commissions were 10.2 million USD, up 62.9% in constant currency, driven primarily by third-party corporate sales in Egypt.
Antoine Maillet: The value of the services was 3.6 million USD, up 3.7% in constant currency. Full Finland revenues was 3.8 million USD, up 14.1% in constant currency, and commissions was 10.2 million USD, up 62.9% in constant currency, driven primarily by food-party corporate sales in Egypt. Revenue from first-party sales was 16.1 million, down 23.8%, and up 4% on a constant currency basis, primarily driven by decreasing corporate sales in Egypt. Glass profit for the quarter was 21.6 million USD, down 5.7% year-old year, or up 34.5% on a constant currency basis. Glass profit margin as a percentage of DMV remain relatively stable at 12.7% compared to 12.8% in Q223.
Antoine Maillet-Mizeray: Revenue from first-party sales was $16.1 million, down 23.8% and up 4% on a constant currency basis, primarily driven by a decrease in corporate sales in it. Gross profit for the quarter was $21.6 million USD, down 5.7% year-over-year or up 34.5% on a constant currency basis. Gross profit margin as a percentage of GMV remained relatively stable at 12.7% compared to 12.8% in Q2 2020.
Speaker Change: Yeah.
Speaker Change: Gross profit margin as a percentage of G. M. D remain relatively stable at 12, 7% compared to 12, 8% in Q2 'twenty three.
Antoine Maillet: These results were driven primarily by the currency deviation in Nigeria, offset by 17% year-on-year reduction in customer incentives and promotions in the quarter as part of our improved marketing spend efficiency. Looking at expenses, we continue to improve our cost-based with fulfillment expenses of 9.3 million USD, down 12.2% year-old year, and up 17.7% on a constant currency basis. With fulfillment expense per order, excluding Jumia Pay app orders, which do not incur logistics cost, decreased 15.9% year-old year, but increased 12.6% on a constant currency basis. The increasing constant currency was primarily driven by fuel costs, which are priced in USD and are therefore impacted by local currency deviations.
Antoine Maillet-Mizeray: These results were driven primarily by the currency devaluation in Nigeria, offset by a 17% year-over-year reduction in customer incentives and promotions in the quarter, as part of our improved marketing spend efficiency. Looking at expenses, we continue to improve our cost base with fulfillment expenses of 9.3 million USD down 12.2% year-over-year and up 17.7% on a constant currency basis. Fulfillment expense per order, excluding JumiaPay app orders, which do not incur logistics costs, decreased 15.9% year-over-year but increased 12.6% on a constant currency basis.
Speaker Change: These results were driven primarily by the currency devaluation in Nigeria, offset by 17% year over year reduction in customer incentives and.
Speaker Change: Promotions in the quarter as part as our improved marketing spend efficiency.
Speaker Change: Looking at expenses, we continue to improve our cost base with fulfillment expenses of $9 3 million USD down 12.2% year over year and up 17.7% on a constant currency basis.
Speaker Change: Well the filament expense per order, excluding Jimmy I paid at owners, which do not incur logistics cost decreased 15, 9% year over year, but increased 12, 6% on a constant currency basis.
Antoine Maillet-Mizeray: The increase in consumer currency was primarily driven by fuel costs, which are priced in USD and are therefore impacted by local currency devaluation. Fulfillment expense as a percentage of GMV improved 44 basis points year-over-year to 5.5%, another important proof point of our logistics transformation taking hold. This includes expanding our logistics footprint outside of major cities by increasing the number of pickup stations, thus helping us reach underserved communities and expand our market while driving down fulfillment costs.
Speaker Change: The increase in constant currency was primarily driven by fuel cost, which are like in USD and are therefore impacted by local currency devaluations.
Antoine Maillet: Full statement expense as a percentage of GMV improved 44 basis points year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old year-old This was driven by improved management of hosting infrastructure, operational tools, and reduction in overhead. As we move forward, we will remain disciplined in our approach to cost in this area while balancing the need to develop new features to improve the customer experience and the local light level.
Antoine Maillet-Mizeray: Additionally, we are improving our proprietary systems to drive scalability while enhancing warehouse efficiency and reducing packaging costs. Sales and advertising expenses were 4.4 million USD for the second quarter, down 19.2% year-over-year and up 19.7% on a constant currency basis, driven by continued focus on optimized marketing spend. We are concentrating on more efficient marketing channels, including an increased emphasis on localized offerings and further leveraging our G4.
Antoine Maillet-Mizeray: As a percentage of GMV, sales and advertising expense was 2.6%, a 45% basis point year-over-year decrease from Q2'23, demonstrating that our strategy to enhance the customer value proposition by prioritizing supply improvement over costly marketing spend is taking hold. Turning to technology, technology and content expense was $8.7 million USD, down 18.5% year-over-year and down 14.4% on a constant currency basis. This was driven by improved management of our hosting infrastructure, operational tools, and reductions in overhead. As we move forward, we will remain disciplined in our approach to cost in this area while balancing the need to develop new features to improve the customer experience on a localized level.
Antoine Maillet: DNA expense, excluding shared base compensation, was 17.6 million USD in Q224, at 1.9% year old buyer, and at 25.6% on a constant currency basis. Driven by the release of a tax provision in the second quarter of 23, which did not trigger in the second quarter of 24. Partially upsetting this increase was blind in staff cost. Staff cost components of DNA expense, excluding shared base compensation expense, decreased to 16.6% as a result of reduction in its counts.
Antoine Maillet-Mizeray: DNA expense, excluding share-based compensation, was $17.6 million USD in Q2-24, up 1.9% year-over-year and up 25.6% on a constant currency basis, driven by the release of a tax provision in the second quarter of 2023, which did not recur in the second quarter of 2024. Partially offsetting this increase was a blind in-staff, have cut components of G&A expense, excluding share- Now, turning to profitability, adjusted EBDLF declined year-over-year to $16.3 million USD or declined $16.1 million on a constant currency basis, driven primarily by the cost reduction initiatives I previously discussed. Loss before income tax from continuing operations was $22.5 million, a 27.1% decrease year over year, or up 1.1% on a constant currency basis. The decrease was, again, driven by our cost reduction initiatives.
Antoine Maillet: Now, turning to profitability, adjusted the BDLS, decline year of either to 16.3 million USD, or decline 16.1 million on a constant currency basis, driven primarily by the cost reduction initiatives I previously discussed. Last before in contact from continuing operations was 22.5 million, the 27.1% decrease year over year, or up 1.1% on a constant currency basis. The decrease was, again, driven by our cost reduction initiatives. As from this discussed, last before income tax includes finance cost.
Antoine Maillet-Mizeray: As Francis discussed, loss before income tax includes finance costs. To ensure that you understand the impact of finance costs on the business, let me take a moment to discuss this dynamic in more detail. In Q1 2024, all finance costs were primarily driven by the foreign exchange impact resulting from the devaluation of both the Nigerian Mayra and the Egyptian pound against the US dollar, as well as costs associated with cash repatriation. In contrast, Q2'24 finance cuts were primarily impacted by non-cash losses recognizing the sale of financial assets. These assets, consisting of investments in securities measured by their fair value, only impact the income statement upon this result.
Antoine Maillet: To ensure that you understand the impact of finance costs on the business, let me take a moment to discuss this dynamic in more detail. In Q1-24, all finance costs were primarily driven by the foreign exchange impact resulting from the devaluation of both the Nigerian naira and the Egyptian pound against the US dollar, as well as costs associated with cash repatriation. In contrast, to 224 finance costs were primarily impacted by non-cash losses, recognizing the sale of financial assets. These assets, consisting of investments in securities, measure that fell at you, only impact income statement upon this rule.
Antoine Maillet-Mizeray: This shift in the contributor to finance cost between the two quarters highlights the varying influences, both cash and non-cash, that impact our performance metrics. Touching on balance sheet and cash flow, CapEx in Q2'24 was $0.7 million, and our liquidity position was $92.8 million USD, comprising $45.1 million in cash and cash equivalents and $47.7 million in term deposits and financial assets. This compares to a liquidity position of 120.6 million into 423 and 101.5 million into 124.
Antoine Maillet: This is in the contributors to finance cost between the two quarters. I light the varying influences, both cash and non-cash, that impact on performance metrics.
Antoine Maillet: The thing on balance sheet and cash flow, capital X in Q2-24, was 0.7 million, and all equity position was 92.8 million USD, comprising 45.1 million in cash and cash equivalence, and 47.7 million in term deposits under financial assets. This, compared to the equity position of 120.6 million in Q4-23, and 101.5 million in Q1-24. The net cash flow used in operation activity was 8.4 million USD, and net change in working gap was 6.7 million in the second quarter of 2024.
Antoine Maillet: Finally, I want to highlight that the company initiated an at-the-market equity offering; this money. The third information about the offering is available in the Prospector Supplement 5 with SEC prior to this call. We expect to use the proceeds of the offering for general corporate purposes, including to help support our continued efforts around customer acquisition, expand our supply of base, scale our logistics network, and improve our marketing and vendor technology. As you've heard from us today, we've been very disciplined and necessary with our cash utilization and plan to continue doing so. The additional equity will further strengthen our balance sheet and help accelerate our growth trajectory.
Antoine Maillet-Mizeray: The net cash flow used in operating activities was 8.4 million USD, and the net change in working gap was 6.7 million in the second quarter of 2024. Finally, I want to highlight that the company initiated an at-the-market equity offering this morning. Detailed information about the offering is available in the prospectus supplement filed with the SEC prior to this call. We expect to use the proceeds of the offering for general corporate purposes, including to help support our continued efforts around customer acquisition, expand our supplier base, scale our logistics network, and improve our marketing and vendor technology.
Antoine Maillet-Mizeray: As you've heard from us today, we've been very disciplined and efficient with our cash utilization and plan to continue doing so. The additional equity will further strengthen our balance sheet and help accelerate our growth trajectory. With that, I will turn the call over to Francis for details on guidance.
Francis Dufay: With that, I will turn the call over to Francis for details on guidance. Thanks, Antoine. Based on our continued strong performance, we are reiterating our outlook for 2024. We remain committed to reducing our losses and accelerating our progress towards cash efficiency and profitable growth. Specifically, we aim to further reduce our cash utilization as compared to through your 23. Based on the positive impact of our growth strategy, Jumia projects are increasing in both orders and GMV in 2024, excluding the potential impact of foreign exchange. As we move forward, we are confident in Jumia's future and our ability to accelerate our growth.
Francis Dufay: Based on our continuous strong performance, we are reiterating our outlook for 2024. We remain committed to reducing our losses and accelerating our progress towards cash efficiency and profitable growth.
Francis Dufay: We aim to further reduce our cash utilisation as compared to FUJIO 23 and... Based on the positive impact of its growth strategy, Jumia projects an increase in both orders and GMV in 2024, excluding the potential impact of foreign exchange. As we move forward, we are confident in Jumia's future and our ability to accelerate our growth. We have the right plan and the right team to advance on the path to profitability, and we look forward to keeping you updated on our progress. We can now open the call for Q&A.
Francis Dufay: We have the right plan and the right team to advance on the path towards profitability and look forward to keeping you updated on our progress.
Operator: We can now open the call for Q&A. Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that is star one to ask a question. One moment, please, while we poll for questions.
Speaker Change: Yeah.
Speaker Change: Thank you at this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
Operator: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that is Star 1 to ask a question. One moment, please, while we poll for questions. Your first question for today is from Fawn Jung with Benchmark. Hi. Hey Francis,
Speaker Change: Confirmation tone will indicate your line is in the question queue.
Speaker Change: You May press Star two if you would like to remove your question from the queue for.
Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again that is star one to ask a question.
Speaker Change: One moment, please while we poll for questions.
Vaughan Jung: Your first question for today is from Vaughan Jung with Benchmark. Hi. Hi, Francis. Anton, thank you for taking my questions. A couple here. First, in terms of growth, GMV growth was very solid in the second quarter. I think Francis, a deep point out in a few factors.
Speaker Change: Your first question for today is from Fang Jiang with benchmark.
Fawn Jung: Hi. Hey, Francis, Antoine. Thank you for taking my questions. A couple here. First...
Fang Jiang: Hi, Hey, Francis.
Fang Jiang: Thank you for taking my questions.
Fang Jiang: A couple here first.
Fawn Jung: In terms of growth, GMB growth was very solid in the second quarter. I think Francis, again, pointed out a few factors. I just wonder, going forward, in terms of sustainability.
Speaker Change: In terms of growth GMB growth was very solid in second quarter, I think France is a gateway out a few factors.
Operator: I just wonder going forward in terms of sustainability. Hello. One moment, please. It looks like her line disconnected.
Speaker Change: I just wonder going forward.
Speaker Change: In terms of sustainability.
Speaker Change: Hello.
Operator: One moment, please; it looks like her line is disconnected. Your line is unmuted.
Operator: One, your line is unmuted. Hey, one, close up here, me. Yep.
Fawn Jung: Hey, can you guys hear me? Yep. Can you guys hear me now?
Operator: Close up here, me now. Yes.
Francis Dufay: Yes. All right, just quickly repeat my question earlier. So in terms of sustainability of your GNV growth, it seems like you have, you know, more countries growing in the second quarter versus the first quarter. So are we looking for more countries to, you know, be growth countries? Or are we looking at higher growth in the existing, you know, growth countries? So in other words, what is the from a country perspective, category perspective, any color in terms of sustainability as well as the magnitude of
Vaughan Jung: All right, just to quickly repeat my question earlier. So, in terms of sustainability of your GNV growth, it seems that you have in the more countries, I was growing in the second quarter versus first quarter. So are we looking for more countries to, you know, to be growth countries, or are we looking at higher growth on the existing, you know, growth countries. So in another words, whether it's from country perspective, categorical perspective, any color in terms of sustainability as both the magnitude of your GNV growth, they'll be very helpful. All right.
Francis Dufay: So thanks a lot, Phuong. So looking at GMP growth this quarter and overall usage growth, we are pleased to see continued acceleration on all usage KPIs that we see as most relevant, being the stabilization of the active consumer base, growth in orders by 7% year-over-year, which is a continued improvement over the past five quarters, and GMP growth in local currency, which is up by 35%, very close to what we had last quarter. We do not foresee any reason why this would not be sustainable. And maybe I can remind you of some of the factors that are behind that and that make me say that we believe.
Francis Dufay: So thanks a lot, fun. So looking at GNV growth is quarter and overall usage growth will be pleased to see continuous acceleration on all usage KPIs that we see as most relevant, being the stabilization of the active consumer base, being growth in orders by seven percent, your value, which is a continued improvement over the past five quarters. And GNV growth in local currency, which is by 35 percent, very close to what we had last quarter. We do not foresee any reason why this would not be sustainable. And maybe let me remind you of some of the factors that are behind that and that make me say that we believe this is sustainable.
Francis Dufay: We are rolling out the same actions and similar actions across all markets with what we see as a similar impact. So we mentioned the example of Upcountry and the expansion that we're doing in smaller cities. And as we push, we gave the example of Kenya and Nigeria. As we push, I mean, as we roll out the same actions and tactics that we started in other countries before, we're seeing similar impacts and positive growth in those cities.
Francis Dufay: We are rolling out the same actions and similar actions across all markets with what we see as similar impacts. So we mentioned the example of up-country and the expansion that we're doing in smaller cities. And as we push, we gave the example of Kenya and Nigeria as we push the, I mean, as we rolled out the same actions and tactics that we started in other countries before. We see similar impacts and positive growth in those cities. So bottom line, as we roll out and we execute with the right qualitative execution of plan across countries, we see similar impact and we benefit from kind of compounded impact of those actions.
Francis Dufay: So bottom line, as we roll out and execute with the right quality of execution our plan across countries, we see similar impact, and we benefit from kind of compounded impact of those actions. I think we've been operating in Africa for over 10 years now.
Francis Dufay: I think we've been operating in Africa for 10 years now. We know how to mitigate all macro challenges that have happened over the past two years. And we see very clearly that the action plan and the strategy that we've laid out for the company is working in more and more countries. So going forward, yes, we expect countries to, I mean, we expect the group to accelerate; we expect countries to be growing.
Francis Dufay: We know how to navigate all the macro challenges that have happened over the past two years, and we see very clearly that the action plan and the strategy that we've laid out for the company are working in more and more countries. And so going forward, yes, we expect countries to, I mean, we expect the group to accelerate. We expect countries to be growing, but I cannot comment or guide on the number and number of countries or the level of growth. But bottom line, our actions that are being rolled out have delivered impact and will keep on delivering more impact. So we don't see any reason why we cannot sustain growth in the future. Understood. Thanks, Trent.
Francis Dufay: I cannot comment on our guide on numbers and number of countries or the level of growth. But bottom line, the our actions that are being rolled out have delivered impact and will keep on delivering more impact. So we don't see any new reason why we cannot sustain growth in the future.
Fawn Jung: Thanks, Francis. My second question is actually regarding your monetization, your tick rate. If I calculate correctly, your marketplace commission rate, it was, you know, growing younger, but it seems like a fairly big decline, quarter on quarter. Any driver behind it? And how should we think about your commission rate in that tick rate going forward?
Vaughan Jung: Thank you. Thank you, Frances.
Vaughan Jung: The second question is especially regarding your monetization, your takes rate. If I calculate correctly, your marketplace commission rate, it was growing younger, but seems like a fairly big decline, quarter on quarter, any driver behind it. And how should we think about your commission rate in that take rate control forward?
Francis Dufay: So I will share the answer with Antoine. Looking at our marketplace and commissions, we've kept our commissions steady, stable across the marketplace over the past year and a half. We want to provide our vendors with stability. So we make sure that we incentivize them, bring more supply to our platform, and we can enhance our assortment and value proposition.
Francis Dufay: So I will share the answer with Antoine. Looking at our marketplace and commissions, we've kept our commissions fairly stable across the marketplace over the past year and a half. We want to provide our vendors with stability, so we make sure that we incentivize them to bring more supply to our platform, so we can enhance our assortment and value proposition. That's our very clear business priority, making sure we deliver a better value proposition, and it comes with providing a stable environment for vendors. I will let Antoine comment on the technologies and financials here.
Francis Dufay: That's our very clear business priority: making sure we deliver better value proposition, and it comes with providing stable environment for vendors.
Antoine Maillet: I will let Antoine comment on technical issues and financial issues here. On the year of our year, variants, we are pretty stable because of what Francis just said, and if we compare to Q124, the decrease is mainly due to the corporate sales in some countries like Egypt. Gotcha, any color going forward? I think we intend to keep our GP1 stable around this quarter percentage, but we will keep on working and capturing the opportunities in corporate sales, which might be a boost.
Antoine Maillet-Mizeray: On the year-over-year variance, we are pretty stable because of what Francis just said, and if we compare to Q1-24, the decrease is mainly due to corporate sales in some countries like Egypt.
Antoine Maillet-Mizeray: Dacha, any color you want going forward?
Antoine Maillet-Mizeray: I think we, I mean, we intend to keep our GP1 stable around this quarter's percentage, but we will we will keep on working on capturing the opportunities in corporate sales, which might be a boost. But as Francis said, we do not want to increase monetization because it would hurt the vendors' participation in the ecosystem.
Antoine Maillet: But, as Francis said, we do not want increased monetization because it would hurt the vendor's participation in the ecosystem. Gotcha.
Fawn Jung: My next question is actually regarding your self-marketing. I noticed that there was a moderate uptake in your self-marketing spending, quote-unquote. I just wonder, you know, how we should look at self-marketing spending going forward, especially in combination with your capital raising. Are we expecting you to re-accelerating growth? I mean, one, you know, self-marketing activities, and secondly, what level of, I think, customer, active customer growth could we anticipate?
Vaughan Jung: My next question is actually regarding your sales marketing. Notice that there was the moderate uptake, your sales marketing spending quarter on quarter.
Francis Dufay: I just wonder how we should look at the sales marketing spending going forward, especially in competition with your capital raising? Are we expecting your rare sell rate in the growth? I mean, one, you know, sales marketing activities and secondly, one level, I think, customer active customer growth could be anticipate. Yeah, so indeed you noticed that we spent a little more in marketing this quarter than the previous quarter. In this specific quarter in Q224, it was meant as a slight boost so we could support our second biggest commercial event of the year, which is GMAT Anniversary Sale, which worked well as you can see the usage KPIs going forward.
Francis Dufay: Yeah, so indeed you notice that we spent a little more on marketing this quarter than in the previous quarter. In this specific quarter, in Q2-24, it was meant as a slight boost so we could support our second biggest commercial event of the year, which is Jumia's anniversary sale, which worked well, as you can see in the usage KPIs.
Francis Dufay: Going forward, I mean we, and particularly in light of the new share offering, we want to make sure that we have the opportunity to accelerate customer acquisition, which may happen through increased spend on marketing, of course. So we want to make sure that we can grow our customer base, which we've just stabilized this quarter, which is quite a milestone for Jumia because they've been shrinking for a while. And we believe that now, I mean, we can capture, of course, a lot more consumers across the African continent.
Speaker Change: Going forwards.
Francis Dufay: I mean, we, and particularly in light with the sales offering, we want to make sure that we have the opportunity to accelerate on customer's acquisition, which may happen through increased sales marketing, of course. So we want to make sure that we can grow our customer base, which we've just stabilized this quarter, which is quite a nice tone for Gmail because they've been shrinking for a while. And we believe that now, I mean, we can capture, of course, a lot more consumers across the African continent. We're working with encounters with over 600 million people, so we can have a much bigger customer base.
Speaker Change: I mean, we and particularly in light wheatstone with.
Speaker Change: She is offering.
Speaker Change: We want to make sure that we have the opportunity to accelerate on customer acquisition.
Speaker Change: Which me happens through increased spend in the marketing of course, so we want to make sure that we can grow our customer base, which we've just stabilize this quarter, which is quite a nice tool for genetic cause shrinking.
Speaker Change: Shrinking for a while.
Speaker Change: And we believe that low I mean, we can capture a lot more consumers across the African continent.
Francis Dufay: We're working in countries with over 600 million people, so we can have a much bigger customer base. And definitely, acquisition of new customers will be an important topic for us in the coming quarters, as we believe that we've made significant progress on the quality of service, expanding the supply chain, and enhancing our assortment and value proposition. It may be the right time indeed to accelerate the customer value proposition, which will mobilize marketing budgets indeed. That's it. Thank you.
Speaker Change: Working with them in countries with over 600 million people. So we can have a much bigger customer base and they're sneaky and new customer acquisition will be an important topic for us over the coming quarters. As we believe that we've made significant progress on quality of service expanding the supply chain and enhancing our assortment and value proposition.
Francis Dufay: And definitely a new customer's acquisition will be an important topic for us in the coming quarters.
Francis Dufay: As we believe that we've made significant progress on quality of service, expanding the supply chain, and enhancing our salt mines and very proposition, it may be the right time and did to accelerate in customer property proposition, which will mobilize marketing Francis, that's it.
Speaker Change: It may be the right time, indeed, accelerating customer value proposition, which will be nice marketing budgets. Indeed.
Fawn Jung: That's it. Thank you so much.
Speaker Change: Okay. That's helpful.
Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.
Operator: Thank you so much.
Operator: Thank you, Pham.
Tom: Thank you Tom.
Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your part.
Speaker Change: This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.