Jumia Technologies, one of Africa’s most well-known e-commerce companies, is reportedly attracting acquisition interest from Mauritius-based telecom and fintech giant, Axian Telecom, as the online retailer struggles with deepening financial challenges and growing competition in Africa’s rapidly evolving digital economy.

Shares of Jumia, which is listed on the New York Stock Exchange (NYSE), jumped by more than 6 percent on Tuesday following a Bloomberg report that revealed Axian is exploring a possible buyout of the company. The interest comes as Axian Telecom, which already holds a stake of over 9 percent in Jumia, is working to raise US$600 million through a bond issuance. The fundraising is being arranged by J.P. Morgan, Standard Bank, and Standard Chartered.

While discussions around the acquisition are still said to be at an early stage, the move signals growing confidence from Axian in Jumia’s long-term value—despite the e-commerce firm’s current financial troubles. Jumia’s performance in the first quarter of 2025 has been underwhelming, with revenue dropping by 26 percent year-on-year to US$36.3 million. Gross profit also fell 36 percent to US$19.9 million, highlighting the company’s struggle to maintain profitability amid rising operational costs and currency volatility in key markets.

Jumia’s business strategy has recently shifted towards streamlining operations. The company has exited weaker markets such as South Africa and Tunisia as part of a cost-cutting effort. It has also kept fulfillment expenses flat and reduced its advertising spend. Although total customer orders increased by 21 percent in Q1 2025—the best performance in two years—gross merchandise volume still declined by 11 percent, mainly due to a dip in high-margin B2B sales and subdued consumer spending in local currencies.

Despite these challenges, Axian Telecom sees potential. Operating in nine African countries with services ranging from telecoms to mobile money, Axian views Jumia as a strategic fit that can enhance its digital ecosystem. The company is particularly interested in leveraging Jumia’s logistics and e-commerce platforms to expand its footprint in digital payments and customer delivery infrastructure across Africa.

Jumia, which once symbolized Africa’s rising tech potential, has seen a dramatic fall in its valuation. Since its 2019 IPO, the company has lost over 90 percent of its market capitalization. From being touted as “the Amazon of Africa,” Jumia is now worth about US$500 million, a steep drop from its peak. The exit of early investors like Rocket Internet, Baillie Gifford, and MTN Group reflects growing investor fatigue and uncertainty about the company’s path forward.

At the same time, global competition in Africa’s e-commerce space has intensified. Chinese players such as Temu and Shein are aggressively entering the continent with low pricing strategies and direct-to-consumer shipping, making it difficult for traditional platforms like Jumia to compete on margins. Local platforms like Nigeria’s Konga, Kenya’s Kilimall, and South Africa’s Takealot have also stepped up, offering strong regional alternatives to global online marketplaces.

Traditional brick-and-mortar retail remains dominant in many parts of Africa, where consumers still rely heavily on physical stores and cash transactions. This presents an uphill battle for e-commerce players trying to gain market share in such an environment. Jumia has recently launched a logistics service for third-party businesses and reported an increase in returning customers, but these improvements are yet to yield significant financial results.

Jumia’s future may now hinge on whether Axian Telecom proceeds with a formal takeover bid. Analysts say that integration with a telecom and fintech-focused entity like Axian could potentially give Jumia the capital and strategic alignment it needs to reposition itself in the African digital economy.

However, the transition from independence to acquisition may also mark a major shift in how Jumia operates, moving away from its original startup ethos towards becoming part of a broader corporate ecosystem. Whether this will translate into long-term survival and growth remains to be seen.