Mercado Pago zvýšil počet měsíčně aktivních uživatelů o 30 % na 88 milionů a objem plateb o 56 % na 101 miliard USD. Úvěrové portfolio vzrostlo o 75 % na 16,4 miliardy USD při NPL 7 %.
Key Takeaways Mercado Pago users jumped 30% to 88 million as MercadoLibre expanded its fintech reach across Latin America.Mercado Pago's AUM surged 68% to $23.2 billion, while its credit portfolio climbed 75% to $16.4 billion.MELI's payment volume jumped 56% to $101 billion, while the 15-90-day NPL ratio held near historic lows at 7%. MercadoLibre, Inc.’s (MELI - Free Report) fintech segment, Mercado Pago, is rapidly solidifying its position as Latin America’s leading financial services platform. The company’s second-quarter 2026 performance demonstrates how its integrated digital finance ecosystem is capturing market share, expanding daily user engagement and driving massive payment volumes across key regional markets.
During the quarter, Mercado Pago’s Monthly Active Users surged 30% year over year to 88 million, with Brazil and Mexico growing 38% and 45%, respectively. The company also cited market-leading NPS in Brazil, Mexico, Argentina and Chile, suggesting that growth is being accompanied by strong user satisfaction.
The platform is increasingly deepening its role in users’ financial lives, as reflected in Assets Under Management, which jumped 68% year over year to $23.2 billion, while AUM per user climbed 29% to $264. Consumer and credit-card exposure per user also increased, showing stronger engagement with Mercado Pago beyond everyday payments.
Mercado Pago’s credit portfolio expanded 75% year over year to $16.4 billion. Within the portfolio, credit-card balances surged 91.3% to about $7.7 billion and accounted for 47% of total credit exposure, up from 43% a year earlier. MercadoLibre issued 2.6 million new cards during the quarter compared with 1.6 million a year ago.
This rapid credit expansion occurred alongside stable asset quality, with the 15-90-day NPL ratio remaining near historic lows at 7%. Payment processing also maintained powerful momentum, as Total Payment Volume (“TPV”) jumped 56% year over year to $101 billion, while acquiring TPV reached $64.1 billion.
The strategic synergy between marketplace activity and financial solutions has made cardholders two to three times more likely to remain ecosystemic users. Driven by accelerating card issuance, remunerated accounts and expanding merchant networks, Mercado Pago is strengthening its position as one of Latin America’s leading fintech platforms.
How Does MercadoLibre Stack Up Against Its Industry?MercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 22.7% over the past three months compared with the industry’s 5.9% rise. While Amazon shares have climbed 5.4%, Sea Limited has rallied 32.6% in the aforementioned period.
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What Does MercadoLibre's Current Valuation Suggest?From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 39.01, higher than the industry average of 21.34. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 22.76) and Sea Limited (22.82).
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What Do Earnings Estimates Signal for MercadoLibre?The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings per share suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
Over the past 30 days, the Zacks Consensus Estimate for earnings per share has declined by $1.89 to $39.11 for the current fiscal year and by $3.13 to $56.05 for the next fiscal year.
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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It has been about a month since the last earnings report for MercadoLibre (MELI - Free Report) . Shares have added about 8.8% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is MercadoLibre due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
MercadoLibre’s Q2 Earnings Beat Estimates, Revenues Rise Y/YMercadoLibre reported second-quarter 2026 earnings of $9.19 per share, which beat the Zacks Consensus Estimate of $8.69 per share by 5.75% and declined 10.86% year over year from $10.31 per share in the year-ago quarter. Revenues rose 49.76% on a year-over-year basis (43% on a foreign-exchange-neutral basis) to $10.17 billion, surpassing the Zacks Consensus Estimate by 4.07%.
Commerce and fintech revenues grew 50% and 49% year over year on a reported basis, respectively. Brazil delivered foreign-exchange-neutral GMV growth of 39% year over year, Mexico posted 26% amid tax reform headwinds, and Argentina delivered 38% against a challenging consumption environment. Advertising revenues rose 62% year over year on a foreign-exchange-neutral basis, with MELI surpassing a 10% share of Latin America's digital advertising market for the first time.
MELI’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, with an average surprise of 107.32%.
MELI’s Q2 in DetailBrazil: Net revenues in the second quarter reached $5,530 million (54.39% of total revenues), up 59% year over year on a reported basis, aided by currency tailwinds, credit card portfolio expansion and robust advertising uptake. On a foreign exchange neutral basis, growth was 42%.
Mexico: The market generated revenues of $2,337 million (22.98% of total revenues), increasing 55% year over year on a reported basis and 38% on a foreign exchange neutral basis. Growth continued to be tempered by the tax reform headwind flagged in the prior quarter, along with a softer macroeconomic environment.
Argentina: Net revenues in the reported quarter were $1,839 million (18.09% of total revenues), reflecting an increase of 20% year over year on a reported basis, as currency movements acted as a headwind. On a foreign exchange neutral basis, growth was 48%.
Other countries: These markets generated revenues of $463 million (4.55% of total revenues), representing growth of 63.03% on a year-over-year basis, with cross-border trade continuing to contribute meaningfully to assortment depth.
Key Metrics for MELIGross Merchandise Volume of $21.9 billion increased 44% year over year and 36% on a foreign exchange neutral basis.
The number of successful items sold was 795 million, up 44.55% year over year. Unique buyer growth was 25.35% year over year, with the number reaching 89 million. Items sold per unique active buyer reached 8.9, growing 14% year over year, led by Brazil, where the metric grew 19% year over year.
Fintech Monthly Active Users rose 29.41% year over year to 88 million. Assets Under Management grew 68% year over year to $23 billion, with AUM per user reaching $264, up 29% year over year. The credit portfolio expanded 75% year over year to $16.4 billion, with credit exposure per user in the consumer and credit card portfolios reaching $231 and $446, growing 34% and 20% year over year, respectively.
Total Payment Volume rose 56% year over year and 56% on a foreign exchange neutral basis to $101 billion. Acquiring Total Payment Volume grew 44% year over year to $64.1 billion, with foreign exchange neutral growth of 42%.
Total payment transactions increased 43.65% year over year to 5,181 million.
The credit portfolio reached $16.4 billion, growing 75% year over year. The credit card issued 2.6 million new cards in the quarter, up from 1.6 million cards a year ago. Asset quality remained solid, with the 15 to 90 day non-performing loan ratio at 7% for the total portfolio and 4.6% for the credit card specifically, both close to historic lows.
MercadoLibre’s Operating DetailsIn the second quarter, gross margin contracted approximately 468 basis points on a year-over-year basis to 40.9%, primarily reflecting pricing and supply initiatives in Brazil, higher shipping costs and increased device costs in Acquiring, particularly in Mexico.
Total operating expenses were $3,476 million, increasing 53.2% year over year. Income from operations declined 17% year over year to $683 million, with the operating margin contracting 550 basis points to 6.7%, as MELI continued to prioritize investment in free shipping, the credit card, first-party inventory, cross-border trade and user acquisition in Acquiring.
Product development expenses scaled favorably from 8.4% of revenues in the second quarter of 2025 to 7.2% in the reported quarter, reflecting productivity gains from AI adoption across the engineering organization. AI investment grew roughly $80 million year over year in the quarter, split between cost of goods sold and product development.
Net Interest Margin After Losses declined to 20.7% from 23% in the second quarter of 2025, driven primarily by a shift in mix toward the lower-spread credit card, which rose from 43% to 47% of the total portfolio. Credit card NIMAL compressed from breakeven in the year-ago quarter to negative 2.5%, reflecting the step-up in issuance rather than any deterioration in asset quality.
Balance Sheet of MELIAs of June 30, 2026, cash and cash equivalents were $3,649 million, down slightly from $3.68 billion as of March 31, 2026.
Short-term investments were $2,081 million as of June 30, 2026, compared to $1.97 billion as of March 31, 2026, an increase of 5.63%. Net debt increased to $6,425 million at the end of the quarter from $5.75 billion as of March 31, 2026, reflecting continued funding of Mercado Pago's credit operations, including $2.1 billion deployed into loan book growth during the quarter, partially offset by $560 million in fintech funding.
Total loans receivable, net of allowances, stood at $11,996 million compared to $10.74 billion as of March 31, 2026, an increase of 11.72%. Adjusted free cash flow was $214 million, improving from negative $56 million in the first quarter of 2026, even after absorbing $441 million of capital expenditure, consistent with the seasonal normalization of cash generation following the first quarter's seasonal weakness.
How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates revision.
VGM ScoresCurrently, MercadoLibre has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, MercadoLibre has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
MercadoLibre dál zvyšuje investice do logistiky a Mercado Pago, i když to tlačí marži dolů a trh to akcii trestá. Firma zároveň hlásí 84 milionů nových aktivních kupujících a 82 milionů fintech uživatelů.
MercadoLibre's (MELI +1.75%) stock price recently closed above $1,950, still roughly 26% below its 52-week high, and the pattern this year has been almost comic: The company reports record revenue and beats estimates, but the stock drops.
In May, MercadoLibre posted its fastest revenue growth in four years, and the stock fell 12.7% the next day. In August, it crossed $10 billion in quarterly revenue for the first time and beat on both lines, but shares dropped as much as 9% before settling down by about 4.5%. Thirty consecutive quarters of 30% or better growth ... and the market keeps flinching.
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The reason is always the same: Operating margin compressed to 6.7% from 12.2% a year earlier, and profit declined for a third straight quarter. Analysts wince every time management signals more spending on logistics and Mercado Pago.
What the spending actually buys Here's where I part ways with that reaction. CFO Martin de los Santos told analysts directly that slowing investment to lift near-term margins would be easy, and the company was choosing not to. "We are not optimizing for short-term margin," he said. "We will continue to invest boldly in those initiatives."
The money goes to specific places:
Free and fast shipping in Brazil, where MercadoLibre lowered the free shipping threshold to defend its largest market. Expansion of the Mercado Pago credit card. First-party inventory selection. Cross-border trade. A logistics and credit build-out concentrated in Brazil. User acquisition in its expanding Mexico market. The results show up in engagement rather than earnings. The company added roughly 84 million active buyers and 82 million fintech users.
The accounting piece most people miss Two-thirds of the margin compression comes from a mechanical quirk rather than deteriorating economics. MercadoLibre's credit book is growing at 87% year over year, faster than revenue. Because the company provisions for the full expected loss on a loan at issuance, faster credit growth depresses margins before those loans ever become profitable.
Think about what that means: Every dollar of new lending shows up as a cost today and revenue over the following quarters. A company growing its loan book at 87% will always look less profitable than one growing it at 10%, even if the underlying credit performs identically.
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The ecosystem argument makes this ticker a buy Mercado Pago started as a payment tool for the marketplace. It now offers digital wallets, QR code payments, credit services, and financial tools to people who may never have had a bank account. Mercado Envios handles warehousing, shipping, and last-mile delivery through distribution hubs across Latin America.
Neither piece works as well alone. The marketplace generates the transaction data that enables underwriting. The credit product raises purchase frequency. The logistics network makes delivery promises credible enough to compete with global entrants. That is a genuine flywheel, and building it requires exactly the spending that the market is punishing.
Why the punishment creates the opportunity Valuation has compressed while the business has expanded. The ratio of forward enterprise value to revenue fell from 3.8 in March 2025 to 2.1; the ratio of enterprise value to EBITDA (earnings before interest, taxes, depreciation, and amortization) moved from around 23.7 to 21.4. You are paying meaningfully less per dollar of revenue than you were 18 months ago for a company growing revenue by 50%.
I think the real risk here isn't the spending itself, it's the credit quality of a loan book that's growing this quickly. That's the part I'm watching most closely. Assuming credit losses remain manageable and the company continues to grow without taking on excessive risk, I think the market may be overreacting to current concerns.
Essentially, this is a company being punished for doing the exact thing that helped build the business in the first place: growing aggressively and expanding its lending business.
MercadoLibre v Brazílii ve 2. čtvrtletí 2026 zvýšil počet prodaných položek o 56 % meziročně a FX-neutrální GMV o 39 %. Nižší hranice pro dopravu zdarma dál zvyšuje konverzi i nákupy napříč kategoriemi.
Key Takeaways MercadoLibre's Brazil items sold jumped 56% year over year in Q2 2026, while FX-neutral GMV rose 39%.Brazil conversion rose 1.1 points, while items sold per unique active buyer climbed 19% year over year.MercadoLibre's Brazilian buyers shopping across at least three categories monthly rose 10 percentage points. MercadoLibre, Inc.’s (MELI - Free Report) decision to lower its free-shipping threshold in Brazil continues to yield meaningful operational benefits, driving sustained momentum across its marketplace. One year after the change, the initiative has produced a durable shift in buyer engagement, increasing conversion, purchase frequency and cross-category shopping, while unit economics continue to improve.
The company reported that items sold in Brazil rose 56% year over year in the second quarter of 2026 compared with 26% growth a year earlier, while FX-neutral GMV increased 39%. MercadoLibre also added nearly 19 million unique active buyers globally, with fastest growth in Brazil, where management highlighted the compounding impact of the lower threshold.
Rather than providing a temporary boost, the reduced threshold triggered a lasting step-change in conversion rates, which expanded by 1.1 percentage points year over year during the quarter. Daily active users have also continued to grow faster than monthly active users in every quarter since MercadoLibre lowered its free-shipping threshold in June 2025. Items sold per unique active buyer in Brazil climbed 19% year over year, leading the company's overall consolidated 14% increase.
The share of Brazilian buyers purchasing across three or more categories monthly expanded by 10 percentage points over the past year. Newer buyer cohorts are also purchasing more items across more categories and showing higher retention than earlier cohorts. Ecosystemic user growth in Brazil accelerated to almost 50% year over year in the quarter, up from 35% before the shipping-threshold change.
MercadoLibre said that free and slow shipments are now variable contribution-positive across half of the average selling price ranges between R$19 and R$79, as scale, technology and unused logistics capacity reduce costs. MercadoLibre still faced higher shipping costs in the quarter, some of which it absorbed, but the evidence so far suggests the free-shipping move has moved beyond a short-lived promotional lift and is supporting more frequent, broader shopping behavior in Brazil.
How Does MercadoLibre Stack Up Against Its Industry?MercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 13.6% over the past three months compared with the industry’s 3.1% rise. While Amazon shares have climbed 2%, Sea Limited has rallied 25.4% in the aforementioned period.
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What Does MercadoLibre's Current Valuation Suggest?From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 39.02, higher than the industry average of 22.13. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 23.35) and Sea Limited (24.46).
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What Do Earnings Estimates Signal for MercadoLibre?The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings per share suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
Over the past 30 days, the Zacks Consensus Estimate for earnings per share has declined by $1.89 to $39.11 for the current fiscal year and by $3.13 to $56.05 for the next fiscal year.
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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre za poslední tři měsíce vzrostla o 14 % díky síle obchodu, fintechu, reklamy a logistiky. Uživatelé ekosystému meziročně stoupli o 37 % a měsíční aktivní uživatelé Mercado Pago dosáhli 88 milionů.
Key Takeaways MELI shares rose 14% in three months, backed by strength in commerce, fintech, ads and logistics. Ecosystemic users grew 37%, while Mercado Pago monthly active users reached 88 million in Q2. MELI trades at 38.42 times forward earnings as investments pressure margins and EPS estimates fall. MercadoLibre, Inc.’s (MELI - Free Report) shares have gained about 14% over the past three months, outperforming the broader market. During the same period, the industry declined 1.1% and the Zacks Retail-Wholesale sector fell 1.7%, while the S&P 500 rose just 0.3%.
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Over the same period, MercadoLibre delivered a stronger share price performance than Amazon.com, Inc. (AMZN - Free Report) , while trailing Sea Limited (SE - Free Report) . AMZN shares slid 5.3%, while Sea Limited posted a 30.7% rally.
MELI’s run reflects confidence in the company’s ability to deepen its leadership in Latin American e-commerce and financial services. Its second-quarter 2026 results reinforced that view, with healthy marketplace engagement, expanding fintech adoption and continued progress across advertising, credit and logistics.
What is Driving MercadoLibre’s Growth?MercadoLibre’s key strength is the breadth of its ecosystem, which combines marketplace, payments, credit, advertising and logistics. The company is benefiting from deeper engagement across these businesses rather than relying only on e-commerce growth. Users active across both commerce and fintech generally transact more frequently and use more products. Ecosystemic users grew 37% year over year in the second quarter, highlighting the strength of this model.
Commerce remains the core growth engine. MercadoLibre continues to improve selection, delivery speed, pricing and financing options. In Brazil, the lower free-shipping threshold has encouraged customers to buy more frequently and across more categories, while supporting better conversion and retention. Management indicated that these changes are driving more lasting shifts in shopping behavior.
The company is also expanding assortment through first-party inventory and cross-border trade. Higher use of its China fulfillment center has helped improve delivery times and reduce cancellations, strengthening the overall customer experience.
Mercado Pago is another major growth driver. The fintech platform is attracting more users as customers increasingly use it for payments, savings and credit. Monthly active users reached 88 million in the second quarter, while assets under management continued to rise. The credit business is also expanding, supported by a greater focus on lower-risk users and improved underwriting.
Advertising is becoming increasingly important as well. MercadoLibre is using AI to improve search, product discovery and ad placement. Management noted that its AI-powered search tools are already delivering higher conversion and advertising gains that more than cover the related technology costs.
Near-Term Hurdles for MercadoLibreMercadoLibre continues to invest heavily in free shipping, seller incentives, first-party inventory, cross-border trade and financial services. These initiatives are designed to strengthen its ecosystem but are weighing on margins. In the second quarter, operating margin was 6.7%, down notably from the year-ago period.
Commerce investments remain a key pressure point. In Brazil, lower seller take rates and PIX-related discounts are helping improve pricing and marketplace selection but are limiting near-term profitability. Higher energy expenses are also increasing logistics costs.
Fintech expansion requires significant investment as well. MercadoLibre is rapidly growing its credit-card business, while new card cohorts typically take 12-18 months to reach NIMAL breakeven. Although credit quality remains healthy, faster issuance can pressure profitability in the short run. Mexico is another concern, as tax changes, softer economic conditions and weaker consumption are affecting commerce growth despite continued market share gains.
MercadoLibre’s Valuation Looks StretchedMELI currently trades at a forward 12-month price-to-earnings (P/E) ratio of 38.42, above the industry ratio of 21.97 and its own one-year median of 34.46. The stock also carries a sizable premium to Amazon at 22.43 and Sea Limited at 24.31.
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This higher valuation reflects MercadoLibre’s strong growth profile and the scale of its commerce-fintech ecosystem. However, the premium also raises the bar for execution. Following the recent share price rally, any moderation in growth or continued pressure on margins could limit further upside.
MELI Earnings Estimates Trend LowerEstimate revisions warrant some caution. Over the past 30 days, the Zacks Consensus Estimate for MELI’s current-year earnings per share (EPS) has moved down to $39.11, while the estimate for next year has declined to $56.05.
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The current-year consensus implies a 0.7% decline from the year-ago level, underscoring how elevated investment spending is weighing on near-term earnings despite strong operating growth. However, the consensus estimate for the next year still indicates a substantial 43.3% increase in EPS, suggesting expectations for stronger earnings leverage.
How Should Investors Play MercadoLibre Stock?MercadoLibre remains well-positioned, supported by strong commerce engagement, rising Mercado Pago adoption and continued expansion across credit, advertising and logistics. At the same time, heavy investments are keeping near-term profitability under pressure. The stock’s premium valuation also leaves less room for execution missteps after its recent rally. MELI’s long-term growth story remains attractive, but current valuation and margin pressures argue against chasing the stock aggressively. Existing investors may hold the stock, while new investors could wait for a more favorable entry point.
MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
GMV společnosti MercadoLibre v Brazílii ve 2. čtvrtletí meziročně vzrostla o 39 % na FX-neutrální bázi a prodané kusy o 56 %. Prodané kusy na jednoho aktivního kupujícího dál rostly o 19 %.
Key Takeaways MercadoLibre's Brazil GMV rose 39% year over year on an FX-neutral basis, while items sold jumped 56%.Buyer engagement deepened as items sold per active buyer rose 19%.Newer Brazil buyer cohorts are buying more items across more categories and showing higher retention. MercadoLibre, Inc.’s (MELI - Free Report) Brazil business remained a standout in the second quarter of 2026, with marketplace growth holding at a high level, even as the company began lapping last year’s reduction in its free-shipping threshold. Gross merchandise volume in Brazil increased 39% year over year on an FX-neutral basis, slightly ahead of the 38% growth recorded in the first quarter of 2026 and substantially ahead of the 29% growth registered in the second quarter last year. Items sold jumped 56% compared with 26% growth a year earlier.
The strength goes beyond transaction volume. Items sold per unique active buyer in Brazil rose 19% year over year, while conversion improved 1.1 percentage points. Daily active users have also continued to grow faster than monthly active users in every quarter since MercadoLibre lowered its free-shipping threshold in June 2025. At the same time, the share of users purchasing three or more categories per month has increased by 10 percentage points since the change.
Newer buyer cohorts are also purchasing more items across more categories and showing higher retention than earlier cohorts. Ecosystemic user growth in Brazil accelerated to almost 50% year over year in the quarter, up from 35% before the shipping-threshold change.
MercadoLibre is supporting this momentum with PIX discounts for buyers and lower take rates for sellers in selected categories and price ranges. Active sellers grew 29% year over year, helping improve selection and price competitiveness. Together, the trends show that Brazil’s growth continues to be supported by stronger engagement, broader supply and sustained marketplace activity.
How Does MercadoLibre Stack Up Against Its Industry?MercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 15.5% over the past three months against the industry’s 0.6% decline. While Amazon shares have fallen 2.9%, Sea Limited has rallied 34.7% in the aforementioned period.
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What Does MercadoLibre's Current Valuation Suggest?From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 38.41, higher than the industry average of 21.88. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 22.59) and Sea Limited (24.24).
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What Do Earnings Estimates Signal for MercadoLibre?The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings per share suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
The Zacks Consensus Estimate for earnings per share has declined by $1.89 to $39.11 for the current fiscal year and by $3.13 to $56.05 for the next fiscal year.
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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre ve 2. čtvrtletí 2026 zvýšil GMV o 44 % na 21,9 miliardy USD a počet prodaných položek o 45 % na 795,4 milionu. Aktivní kupující vzrostli o 26 % na 89,3 milionu.
Key Takeaways MercadoLibre's Q2 GMV rose 44% to $21.9B, while items sold increased 45% to 795.4 million units.MercadoLibre's active buyers grew 26% to 89.3M, while Brazil's conversion rate rose 1.1 percentage points.MercadoLibre's ecosystemic users generated 70% more GMV per user than marketplace-only users. MercadoLibre, Inc. (MELI - Free Report) achieved total Gross Merchandise Volume (“GMV”) of $21.9 billion in the second quarter of 2026. This performance represents a 44% year-over-year expansion in U.S. dollar terms and 36% growth on an FX-neutral basis. Consolidated items sold rose 45% year over year to reach 795.4 million units.
A principal driver behind this sustained volume strength is the deepening level of buyer engagement across core regional markets. Unique active buyers on the marketplace expanded 26% year over year to reach 89.3 million. Items sold per unique active buyer increased 14%, driven by a 19% gain in Brazil. This elevated activity stems from structural initiatives such as the lowered free-shipping threshold introduced in Brazil, which produced a step-change in conversion rates and improved long-term user retention. Brazil’s conversion rate increased 1.1 percentage points year over year.
Regional performance contributed significantly to overall volume expansion. On an FX-neutral basis, Brazil recorded 39% year-over-year GMV growth, while Mexico registered 26% growth. In Argentina, FX-neutral GMV expanded 38% despite broader macroeconomic consumption challenges. Cross-border trade GMV posted 60% FX-neutral growth, supported by expanded fulfillment capabilities in China.
The broader ecosystem structure also reinforces marketplace activity through synergistic usage. Ecosystemic users who utilize both the marketplace platform and Mercado Pago financial services generated 70% more GMV per user than marketplace-only users.
MercadoLibre is widening selection through domestic sellers and cross-border inventory while improving the shopping proposition. This helps explain why GMV growth remains a closely watched measure for investors even when consumer conditions differ across markets.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 12.7% over the past three months compared with the industry’s 1.1% rise. While Amazon shares have declined 1.3%, Sea Limited has rallied 35.4% in the aforementioned period.
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From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 35.94, higher than the industry average of 22.21. The stock is also trading above its 12-month median level of 34.47.
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MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 22.74) and Sea Limited (23.39).
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
MercadoLibre ve 2. čtvrtletí zvýšila tržby o 50 % na 10,2 miliardy USD, ale provozní zisk klesl o 17 % na 683 milionů USD. Marže se snížila na 6,7 % kvůli investicím do růstu.
Key Takeaways MercadoLibre's Q2 revenues rose 50%, while operating margin fell to 6.7% amid growth investments.Brazil conversion stayed 1.1 points higher as free shipping boosted retention and purchasing activity.Active sellers rose 29%, while items sold per unique buyer climbed 14%, including 19% growth in Brazil. MercadoLibre, Inc. (MELI - Free Report) posted impressive second-quarter 2026 net revenue and financial income of $10.2 billion, representing a 50% year-over-year increase. However, operating income fell 17% to $683 million, pulling operating margin down 550 basis points to 6.7%, although it contracted only 20 basis points sequentially. Net income margin also contracted 310 basis points year over year to 4.6%. The margin pressure reflects MercadoLibre’s deliberate decision to prioritize investments in engagement, growth and scale over near-term profitability.
The clearest test of whether that sacrifice is paying off comes from Brazil. A year after MercadoLibre lowered its free-shipping threshold, conversion remained 1.1 percentage points higher year over year. New buyer cohorts are purchasing more items across more categories and showing higher retention. The economics of free shipping are also improving as scale and logistics efficiencies make more lower-priced shipments profitable.
MercadoLibre has extended this strategy through PIX discounts for buyers and lower take rates for sellers in selected categories. While these actions weigh on near-term profitability, they improved price competitiveness and helped active sellers grow 29% year over year. Meanwhile, items sold per unique buyer increased 14%, including 19% growth in Brazil.
The payoff is also visible in broader commerce activity. Gross merchandise volume increased 36% year over year on an FX-neutral basis, while items sold advanced 45%. Unique active buyers reached 89.3 million, up 26%, with Brazil showing the fastest growth as the impact of the lower free-shipping threshold continued to compound.
Deeper engagement carries economic value. Users who participate in both MercadoLibre’s marketplace and Mercado Pago generate more GMV, purchase across more categories and are substantially more profitable than users of either service alone. Management said contribution profit per ecosystemic user is multiples of that generated by marketplace-only and fintech-only users combined.
For now, the growth-for-margin trade-off is producing measurable behavioral gains. Higher conversion, purchasing frequency, retention and seller participation indicate that MercadoLibre’s investments are deepening engagement, while improving shipping economics provide early evidence that some of the initial margin pressure can ease as scale builds.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 17% over the past three months compared with the industry’s 3.4% rise. While Amazon shares have gained 2.1%, Sea Limited has rallied 33.7% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 34.99, higher than the industry average of 23.23. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 23.79) and Sea Limited (22.34).
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The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 3.3%, respectively. For the next fiscal year, the consensus estimate indicates a 27% rise in sales and 45.9% growth in earnings.
SummaryMercadoLibre delivered 50% YoY revenue growth to $10.2B, with GAAP EPS of $9.19, reinforcing my Buy rating.MELI’s margin contraction is a deliberate, strategic reinvestment into growth initiatives like free shipping, first-party inventory, and card issuance.Advertising revenue surged 73% YoY, funding user growth and enabling MELI’s push into lower-end markets, despite a 550bps margin decline.Asset quality in Mercado Pago is improving, with NIMAL recovering to 20.7% and NPL ratios at historical lows, supporting long-term profitability. Leila Melhado/iStock Editorial via Getty Images
Post-Earnings Review I recently covered MercadoLibre, Inc. (MELI) with a Buy rating, based on the fact that recent margin contraction is a willing result of management's strategy to establish a walled garden
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Uživatelé ekosystému MercadoLibre vzrostli ve 2. čtvrtletí 2026 meziročně o 37 % a generovali GMV o 70 % vyšší než zákazníci pouze marketplace. Držitelé kreditních karet mají 2 až 3krát vyšší šanci zůstat v ekosystému.
Key Takeaways MercadoLibre's ecosystemic users grew 37% year over year in Q2 2026, faster than other user groups.MELI ecosystemic users generated 70% more GMV and bought 55% more items per user.Credit card holders are two to three times more likely to remain ecosystemic. MercadoLibre, Inc.’s (MELI - Free Report) ecosystem advantage is becoming more visible in the way users move between commerce and financial services. The marketplace attracts buyers and sellers, while Mercado Pago provides payments, credit, savings and insurance products. As usage expands across both platforms, each business improves the relevance of the other.
The clearest evidence comes from ecosystemic users, meaning customers who use both MercadoLibre’s marketplace and Mercado Pago. This user group grew 37% year over year in the second quarter of 2026, faster than unique commerce buyers and fintech monthly active users. Management also noted that ecosystemic users have been the company’s fastest-growing segment since late 2023.
Ecosystemic users generated 70% more gross merchandise volume and bought 55% more items per user than marketplace-only customers. They also shopped across more categories and used the marketplace more frequently. Within fintech, these users generated almost 90% more payment volume per user than fintech-only customers. Their assets under management were more than double, and their insurance usage was almost four times higher.
MercadoLibre is also using specific products to pull users deeper into the ecosystem. Credit card holders are two to three times more likely to remain ecosystemic. Meanwhile, the MELI+ loyalty program grew subscriber count by 72% year over year, deepening user stickiness even further.
The result is a broader relationship with each customer. A user may begin by purchasing an item, then adopt Mercado Pago, receive credit, hold savings and join MELI+. Every additional connection increases convenience and reduces the need to leave the platform, strengthening a network that becomes more valuable as participation deepens. This compounding profitability underscores why MercadoLibre’s ecosystem structure is difficult to beat.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares gain 2.8% over the past three months compared with the industry’s 0.8% rise. While Amazon shares have gained 0.5%, Sea Limited has rallied 29.6% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 37.07, higher than the industry average of 23.02. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 27.89) and Sea Limited (22.70).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4.1%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 44.4% growth in earnings.
Image Source: Zacks Investment Research
MELI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mercado Libre sdělila, že nižší hranice pro dopravu zdarma v Brazílii změnila chování zákazníků: denní aktivita roste rychleji než měsíční a počet položek na jednoho kupujícího stoupl za rok o 19 %.
A year after lowering the threshold for free shipping in Brazil, Mercado Libre has seen the offering drive “a structural change in behavior,” the eCommerce and FinTech company said in a Wednesday (Aug. 5) press release reporting its second-quarter earnings results.
Since Mercado Libre made the change, daily active users have grown faster than monthly active users in every quarter, new buyers are purchasing more, across more categories, and those new buyers are showing higher retention than those who came before the change, according to the release.
Overall, among all buyers in Brazil, items per buyer have grown 19% in the year since the company lowered its free shipping threshold in the country, Mercado Libre Chief Financial Officer Martín de los Santos said during a Wednesday earnings call.
“That’s a sign of changed behavior, not just a bigger audience,” de los Santos said. “It shows existing users engaging more deeply with us, not simply more people showing up.”
Across its entire business, which includes operations in Brazil, Argentina, Mexico and 15 other countries, Mercado Libre saw its revenue increase 50% year over year to $10.2 billion in the second quarter. The revenue of the company’s Commerce business grew 50% year over year to $5.8 billion, while that of its FinTech business, Mercado Pago, rose 49% to $4.4 billion, according to the release.
Mercado Libre’s margins have compressed over the past year. The company’s income from operations margin saw a year-over-year decline in the second quarter from 12.2% to 6.7%, while its net income margin dropped from 7.7% to 4.6%, according to a presentation released Wednesday.
The company attributed the margin compression to “deliberate investments to strengthen engagement and long-term growth,” per the presentation.
Those investments include higher shipping costs, initiatives on its marketplace in Brazil to improve price competitiveness, investment in user acquisition and higher point-of-sale (POS) device costs that reflect the increase in memory chip prices, Mercado Libre said in a letter to shareholders released Wednesday.
During the earnings call, de los Santos said the decline in margin was “the result of a deliberate choice to continue prioritizing investment in long-term engagement, growth and scale over near-term profitability.”
MONTEVIDEO, Uruguay--(BUSINESS WIRE)--MercadoLibre, Inc. (NASDAQ: MELI) (http://www.mercadolibre.com) today reported financial results for its second fiscal quarter ending June 30, 2026, in a Letter to Shareholders, which is now posted to the company’s Investor Relations website at https://investor.mercadolibre.com.
MercadoLibre, Inc. Reports Second Quarter 2026 Financial Results
Share The Company will host its earnings video conference, as well as a conference call and audio webcast for any questions that investors may have, on August 5, 2026 at 5:00 p.m. Eastern Time.
In order to access our video webcast and the live audio, investors, analysts and the market in general may access the following link at https://event.choruscall.com/mediaframe/webcast.html?webcastid=xr1sGkCu to attend the live event.
To participate in our conference call Q&A, investors, analysts and the market in general may access the following link https://hdr.choruscall.com/?$Y2FsbHR5cGU9MiZyPXRydWUmaW5mbz1jb21wYW55LXBob25l or dial in through the following numbers: TOLL FREE 1-833-821-3654 | INTERNATIONAL 1-412-652-1249 and ask to join MercadoLibre's conference call to be able to pose questions.
Access to our video webcast and the live audio will be available in the investor relations section of the Company's Investor Relations website, at http://investor.mercadolibre.com. An archive of the webcast will be available for one week following the conclusion of the conference call.
About Mercado Libre
Founded in 1999, MercadoLibre, Inc. (NASDAQ: MELI) is the leading company in e-commerce and financial technology in Latin America, with operations in 18 countries. It offers a complete ecosystem of solutions for individuals and businesses to buy, sell, advertise, obtain credit and insurance, collect, send money, save, and pay for goods and services both online and offline. Mercado Libre looks to facilitate access to commerce and financial services in Latin America, a market that offers great opportunities and high growth potential. It uses world-class technology to create intuitive solutions tailored to the local culture to transform the lives of millions of people in the region. More information at http://investor.mercadolibre.com or contact our IR team at [email protected].
When MercadoLibre (MELI +1.20%) releases its earnings report on Aug. 5, there's one stat I'll be looking at in particular: revenue growth.
Last quarter, MercadoLibre's revenue jumped 49%, its fastest pace in four years. Revenue topped analysts' expectations, and it's a clear indication that the e-commerce and fintech company is rapidly expanding through Latin America as planned.
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MercadoLibre's Brazilian market saw a 56% increase. At the same time, its unit shipping costs dropped 17% year over year. This is due to the company's efforts to improve infrastructure and logistics within emerging markets.
Wall Street has still punished the stock despite clear evidence that the company's strategic investments are really starting to pay off. MercadoLibre's executive team deliberately reinvested capital in growth, which caused a temporary drop in operating margin that investors apparently did not like.
Image source: The Motley Fool.
For those focused on the long term, however, MercadoLibre is priced quite attractively right now. The stock is down more than 20% in the past 12 months. The company is currently trading at less than 3 times its sales, with a price-to-earnings-to-growth (PEG) ratio of 1.15. This suggests that MercadoLibre is either fairly priced or slightly undervalued.
Getting back to the one stat that tells a bigger story: 49% revenue growth. If MercadoLibre can maintain this pace or accelerate it, the stock will eventually begin to reflect the incredible investments the company has made over the past decade to build a viable e-commerce and fintech business in Latin America. The opportunity there is too massive to ignore.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends MercadoLibre. The Motley Fool has a disclosure policy.
MercadoLibre uzavřel o 1,02 % výše a za poslední měsíc přidal 7,54 %, čímž překonal S&P 500. Investoři čekají na výsledky, kde se odhaduje EPS 8,69 USD a výnosy 9,77 miliardy USD.
MercadoLibre (MELI - Free Report) closed at $1,819.74 in the latest trading session, marking a +1.02% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.02%. On the other hand, the Dow registered a gain of 0.51%, and the technology-centric Nasdaq decreased by 0.18%.
The operator of an online marketplace and payments system in Latin America's stock has climbed by 7.54% in the past month, exceeding the Retail-Wholesale sector's loss of 1.33% and the S&P 500's gain of 0.77%.
The upcoming earnings release of MercadoLibre will be of great interest to investors. The company is expected to report EPS of $8.69, down 15.71% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $9.77 billion, up 43.9% from the prior-year quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $41 per share and revenue of $40.36 billion. These totals would mark changes of +4.06% and +39.68%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for MercadoLibre. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.07% higher. Currently, MercadoLibre is carrying a Zacks Rank of #2 (Buy).
Looking at valuation, MercadoLibre is presently trading at a Forward P/E ratio of 43.94. This expresses a premium compared to the average Forward P/E of 16.29 of its industry.
Also, we should mention that MELI has a PEG ratio of 1.11. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Internet - Commerce was holding an average PEG ratio of 1.11 at yesterday's closing price.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 155, finds itself in the bottom 37% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
MercadoLibre investuje do logistiky a v 1. čtvrtletí zvýšil počet aktivních kupujících o 26 %, GMV o 36 % a prodané kusy o 47 % meziročně. Zisková marže ale klesla z 8,3 % na 4,7 %.
MercadoLibre (MELI +0.16%) stock has fallen by 31% from its previous peak as Wall Street focuses on near-term margin pressure and intensifying competition. Yet the business continues to expand rapidly in Latin America's e-commerce market, potentially setting the stage for market-beating returns in the next five years.
Its lower margins are not a result of competition, but rather of its higher near-term spending on infrastructure to support growth. This makes the stock a compelling buy for patient investors.
Image source: The Motley Fool.
Building a competitive moat Similar to Amazon in the U.S., MercadoLibre has a structural advantage in Latin America's e-commerce market. It continues to invest in logistics infrastructure to build the most efficient delivery network in one of the world's fastest-growing e-commerce markets.
The growth it continues to report shows a huge opportunity ahead. The number of unique active buyers grew 26% year over year in the first quarter. Gross merchandise volume increased by 36%, with the number of items sold rising by 47%. It does face increasing competition from Asian e-commerce companies like Temu and Shopee, but these numbers show that MercadoLibre's investments to expand free shipping offers and other services are protecting its competitive position.
Investments in its delivery network are driving faster delivery and lowering costs. Unit shipping costs declined 17% year over year in local currency, despite a sharp increase in order volumes. MercadoLibre is benefiting from higher purchase frequency and greater scale and productivity, which points to healthy margins in the long run.
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Growth potential and returns E-commerce is only half the story. MercadoLibre is also a major player in fintech, where its massive volume of marketplace data gives it the ability to make more accurate estimations in its credit underwriting. It has issued 2.7 million credit cards, effectively turning marketplace-only users into financial services customers and creating a powerful growth flywheel.
The stock's latest sell-off reflected the company's sliding profit margin, which fell from 8.3% a year ago to 4.7% in the first quarter. However, the long-term growth opportunity is still quite large. Latin America's retail e-commerce growth was about 1.5 times the global average in 2025, according to eMarketer. E-commerce penetration in Argentina, Brazil, Colombia, Mexico, and Uruguay is less than 10%, suggesting that MercadoLibre can continue to grow for many years.
Despite the opportunity ahead of the company, the stock is trading at its lowest sales- and earnings-based multiples in several years. Analysts expect earnings to grow at an annualized rate of 29% in the coming years. At that rate, MercadoLibre stock could reasonably double in value in five years and potentially outperform the broader market.
MercadoLibre vykázal růst tržeb o 49 %, ale provozní zisk klesl o 20 % kvůli vyšším logistickým nákladům a investicím do Mercado Pago. Trh se soustředí na nižší marži, ne na sílu ekosystému.
When MercadoLibre (MELI +0.16%) reported another quarter of strong revenue growth, investors quickly shifted their attention elsewhere:
Operating margin narrowed. Logistics costs increased. Shipping subsidies remained elevated. These became investors' focus instead of the headline growth of 49%.
The market's concern was straightforward: MercadoLibre's growth is becoming more expensive. That's a fair concern, since profitability ultimately determines shareholder returns. But it also raises a more important question:
What if today's margins tell us less about MercadoLibre's future than the strength of its ecosystem?
Long-term investors should care about both.
Image source: Getty Images.
Margins tell you where the business is today There are many ways to analyze a business, of which operating margin is probably one of the easiest to understand and track.
Higher margins usually signal pricing power, operating leverage, or disciplined execution. On the other hand, lower margins often suggest rising competitive pressure or heavier investment.
And that's exactly why MercadoLibre's recent results worried investors. The company lowered free-shipping thresholds in Brazil, expanded its logistics network, and continued investing aggressively in Mercado Pago. Those decisions pushed costs higher and compressed profitability. For perspective, operating profit fell by 20% despite the massive revenue growth.
Viewed quarter by quarter, the market's reaction makes sense. After all, nobody likes a lower profit.
But here's the thing. Quarterly margins only inform us what the company is today. They don't explain what kind of business MercadoLibre will become over the next few years. And that's why investors should also focus on other leading indicators.
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The strength of the ecosystems creates tomorrow's margins The businesses that generate exceptional returns over the long run rarely maximize profits while they're building competitive advantages. Instead, they invest heavily to strengthen the ecosystem first.
For instance, Amazon spent decades building fulfillment infrastructure before retail margins improved. Costco invests heavily in lowering merchandise margins to create extraordinary customer loyalty, making money solely from its memberships. Similarly, Uber in the early days prioritized network density over profitability.
MercadoLibre appears to be following the same playbook. Every additional logistics hub shortens delivery times. Every new Mercado Pago user increases payment adoption. Every merchant that relies on Mercado Envios becomes more deeply embedded in the platform. Every advertiser that buys Mercado Ads creates another high-margin revenue stream.
Individually, these investments pressure margins in the short term. But collectively, they strengthen the ecosystem over the years that follow. And stronger ecosystems usually create better economics over time.
The metrics that investors should watch Instead of asking whether the operating margin expanded this quarter, investors should ask whether MercadoLibre's competitive strength has improved. And areas to focus on are:
Are buyers shopping more frequently? Are merchants relying on MercadoLibre for more than just sales? Are more consumers using Mercado Pago more often outside the marketplace? Are advertisers spending more to reach the platform's growing audience? If the answer to those questions is yes, MercadoLibre's competitive moat is likely widening, even if today's margins look weaker. That's because ecosystem strength compounds over time. Once buyers, sellers, payments, logistics, advertising, and credit reinforce one another, each new customer generates more value for the ecosystem than previous customers did.
While these network effects don't appear overnight in an income statement, they eventually show up in pricing power, higher returns on capital, and expanding free cash flow.
In other words, great ecosystems create great margins over time.
What does it mean for investors? To start with, none of what was discussed above means investors should ignore profitability. Eventually, MercadoLibre must convert today's investments into stronger earnings.
But focusing exclusively on quarterly margins risks missing the bigger picture. The company has already proven it can build Latin America's leading commerce and fintech platform.
Now it needs to prove something even more important: That today's investments are making the business stronger tomorrow.
If they are, today's margin pressure may not be a warning sign. It may simply be the cost of building the next phase of MercadoLibre's competitive advantage.
MercadoLibre letos klesá o 10,68 % a Scotiabank mu stanovila cílovou cenu 2 800 USD, což naznačuje zhruba 55% růst. Tržby ve 1. čtvrtletí vzrostly o 49 % na 8,85 miliardy USD, ale provozní zisk klesl o 20 %.
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MercadoLibre (NASDAQ:MELI | MELI Price Prediction) trades at $1,799.21 against a Wall Street consensus target of $2,214.88, an implied gap of roughly 23%. Scotiabank’s Hector Maya carries a Sector Outperform rating and $2,800 Street-high target on the stock, which implies roughly 55% upside, well above the 40% threshold that flags an outlier call.
MercadoLibre runs Latin America’s dominant e-commerce and fintech ecosystem, pairing the Mercado Libre marketplace with Mercado Pago payments, Mercado Envios logistics, advertising, and a fast-scaling credit card book. The stock sits on a bruised Q1 2026 print that has the market debating temporary land grab versus structural damage.
Margins Collapsed and the Market Reacted Violently Revenue hit $8.85 billion, up 49% year-over-year and beating the $8.32 billion consensus, but operating income fell 20% to $611 million, operating margin compressed roughly 600 basis points to 6.9%, and adjusted free cash flow flipped negative at -$56 million. Shares dropped 15.8% in the first week after the print.
Provisions for doubtful accounts more than doubled to $1.244 billion, and management disclosed it had extended average Brazilian loan terms from 5 months to 8 months while pushing into riskier borrower segments. Multiple law firms opened securities investigations, and the CFO signaled the aggressive investment posture would continue through 2026 with no near-term margin relief expected.
Why 20 of 24 Analysts Still Rate It Buy The bull case, most aggressively voiced by Maya, frames this as a deliberate margin reset that will reverse once the current investment cycle matures. MercadoLibre is spending near-term operating income to lower free-shipping thresholds, scale first-party retail, and issue credit cards at a pace that grew the portfolio 104% year-over-year to $6.6 billion. Maya argues that at $2,800 the stock trades at roughly 28x NTM EV/FCF, which underprices a company compounding revenue at 20% plus in a region where e-commerce penetration is still mid-teens.
Brazil revenue grew 55% year-over-year, Mexico 62%, advertising revenue 73%, and fintech assets under management 77% to nearly $20 billion. Coverage sits at 20 Buy, 4 Hold, 0 Sell, with Jefferies among recent upgraders and Daiwa the notable trim. Bulls want operating margin re-expansion visible by early 2027 as newer card cohorts season and shipping subsidies stop growing as a share of revenue.
The Peer Group Did Not Fall Together Sea (NYSE:SE) is off 17.79% year to date on the same reinvestment story inside its Monee fintech unit. At $104.88 against a $142.26 analyst target, upside runs about 36% behind 27 Buys and 2 Holds.
Nu Holdings (NYSE:NU), Mercado Pago’s most direct LatAm rival, has slipped 13.32% year to date after its own Q1 credit-provision spike. At $14.51 versus a $17.94 target, upside is roughly 24% with 19 Buys, 2 Holds, and 1 Sell.
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Amazon (NASDAQ:AMZN) is the exception, up 6.08% year to date on AWS strength. At $244.85 against a $312.87 target, upside is about 28% behind 62 Buy ratings and no Sells.
Across the four names, Scotiabank’s $2,800 MELI target remains the largest single upside call.
Where the Numbers Land Against the S&P 500 MELI is down 10.68% year to date and 24.55% over the past twelve months. The S&P 500 has climbed 9.6% year to date and 18.85% over the same year, so the stock trails the index by more than 20 percentage points YTD.
Consensus target of $2,214.88 implies about 23% upside; Maya’s $2,800 implies close to 55%. Coverage runs 24 analysts deep, institutional ownership sits at 87.62%, and the trailing P/E is roughly 48, leaving limited room for further margin misses.
My Take: Cautiously Constructive at Current Levels The bull path holds if operating margin bottoms within two quarters and Brazil credit provisions stabilize as the extended-duration loan book seasons. In that path, revenue keeps compounding above 40% and the multiple re-rates. Maya’s $2,800 simply requires the current investment cycle to prove out on schedule.
The bear path plays out if the loan-duration extension turns out to be underwriting drift to hit growth targets. Rising provisions, 8-month terms, and a softer Brazilian consumer would trap the business in a lower-margin profile, and at 48x earnings there is no cushion for that outcome.
My lean is cautiously constructive. The reinvestment metrics are landing, but I’d anchor closer to the consensus $2,214 target than to $2,800 until the next quarter confirms the credit book is behaving.
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MercadoLibre v 1. čtvrtletí zvýšil GMV o 42 % na 19 miliard USD a prodané položky o 47 % na 721,7 milionu. Růst táhla hlavně Brazílie, kde FX-neutrálně očištěné GMV vzrostlo o 38 %.
Key Takeaways MercadoLibre's Q1 GMV rose 42% to $19 billion as items sold jumped 47% to 721.7 million.Brazil's FX-neutral GMV grew 38%, with items sold up 56% and unique buyers rising 32%.Mexico, Argentina and Chile posted FX-neutral GMV growth of 28%, 41% and 40%, respectively. MercadoLibre, Inc. (MELI - Free Report) demonstrated broad-based gross merchandise volume (GMV) growth across Latin America during the first quarter of 2026. Consolidated GMV reached $19 billion, representing a 42% year-over-year increase in U.S. dollars and 36% growth on a foreign-exchange-neutral basis, underscoring rising consumer engagement across the company’s commerce ecosystem. The increase was supported by a 47% year-over-year jump in total items sold to 721.7 million units.
Brazil, the company's largest market, spearheaded this growth as foreign-exchange-neutral GMV growth accelerated to 38% year over year. This performance marks a steady quarterly acceleration from the 30% growth recorded in the first quarter of 2025. Items sold in Brazil jumped 56% year over year, more than double the 25% growth recorded in the first quarter of 2025, while unique buyer growth in the country surged to 32%, the fastest pace in five years.
MELI attributed Brazil’s stronger performance to increased buyer activity following the lower free shipping threshold, which drove higher conversion, greater shopping frequency, stronger retention and record customer satisfaction. At the same time, daily active users grew faster than monthly active users.
The momentum extended across the region. Mexico generated 28% foreign-exchange-neutral GMV growth despite a tougher tax environment affecting smaller merchants, while Argentina posted 41% growth on top of a high comparison base. Chile also maintained strong momentum with 40% GMV growth, supported by higher free shipping penetration and faster delivery capabilities.
Management emphasized that these results demonstrate continued market share gains across key markets and reinforce the long-term opportunity as e-commerce adoption across Latin America remains well below more mature markets.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares tumble 18.7% over the past six months compared with the industry’s 3% decline. While Amazon shares have jumped 2.7%, Sea Limited has fallen 16.7% in the aforementioned period.
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From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 35.17, higher than the industry average of 21.92. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 25.53) and Sea Limited (20.96).
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The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4.1%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 44.4% growth in earnings.
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MELI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre jedná s chilskými úřady o provozování vlastní online lékárny, což by vyžadovalo změnu místních pravidel. V Chile zatím smí prodávat léky pouze od třetích stran.
An employee of e-commerce MercadoLibre works at the company's offices in Buenos Aires, Argentina September 6, 2024. REUTERS/Agustin Marcarian Purchase Licensing Rights, opens new tab
SANTIAGO, July 23 (Reuters) - E-commerce firm MercadoLibre (MELI.O), opens new tab has discussed a proposal with Chilean authorities to operate as a pharmacy in the country, a plan that would require a change in local regulations, records of meetings between the parties showed.
The move would mark the latest step by Uruguay-based MercadoLibre, once primarily a marketplace for external sellers, toward expanding its own retail operations while deepening its push into pharmacies after a similar pilot in Brazil.
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MercadoLibre, which operates across Latin America and is one of the region's largest firms by market capitalization, met with Chilean officials at least six times in the past year. Meeting minutes revealed MercadoLibre's previously unreported plan to operate an in-house and online-only pharmacy model in Chile.
The plan would expand the firm's Chile operations, where, as in Argentina, Mexico and other markets, MercadoLibre currently only sells medication from third-party retailers.
After hearing the plan, Chile's health ministry recommended that MercadoLibre seek a technical evaluation from the nation's Public Health Institute (ISP), since the proposal would require regulatory changes or reinterpretations, according to records from a January meeting.
ISP in a written response to a request for comment did not detail whether MercadoLibre had requested that evaluation. It said MercadoLibre currently does not have authorization to operate an in-house drugstore in Chile, and that current regulations do not allow for the operation of an online-only drugstore.
Chile's health ministry did not respond to requests for comment.
MercadoLibre said in a statement to Reuters that it was working to gradually expand its health offering, adapting to each market's regulatory framework. It declined to comment specifically on plans in Chile.
As part of a broader long-term business strategy, the firm has increased investment in its in-house retail operations in recent quarters, focusing on segments such as beauty and household appliances.
That strategy has pressured margins, causing the stock to tumble almost 11% so far this year to $1,799 each.
In Brazil, its biggest market, MercadoLibre bought a physical drugstore last year due to local rules requiring a brick-and-mortar presence for companies selling medicines. It began a pilot there in March selling over-the-counter medicines, promising delivery in an average of up to three hours. It has yet to expand outside of Sao Paulo.
The firm's pitch in Chile also included deliveries in "a few hours in some regions," according to minutes from a meeting in September.
Chile lags behind the company's largest markets of Brazil, Mexico and Argentina, but a successful rollout there could serve as a model for expansion across Latin America.
Reporting by Kylie Madry in Santiago and Andre Romani in Sao Paulo; Editing by Mark Porter
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Kylie Madry is a headline news reporter covering business, politics and breaking news for all of Latin America. She's based out of the Reuters office in Mexico City, where she was previously a freelance journalist and translator working on award-winning podcasts, books about Mexico's drug lords and stories ranging from the fight for clean water to the millions spent on the city's surveillance system. Kylie is originally from Dallas, Texas.
MercadoLibre rozšířila síť fulfillmentu na více než 50 zařízení a v prvním čtvrtletí 2026 odbavila 55 % všech zásilek. Doručení ve stejný den a následující den vzrostlo meziročně o 39 % na 199 milionů.
Key Takeaways MercadoLibre's network topped 50 facilities and handled 55% of first-quarter 2026 shipments.Same- and next-day shipments rose 39% to 199 million, while network penetration reached 95.5%.Brazil shipping costs fell 17% as density, utilization, routing and technology improved efficiency. MercadoLibre, Inc.’s (MELI - Free Report) continues to fortify its competitive position in Latin America through strategic investments in its logistics infrastructure. The company’s managed fulfillment network has emerged as a primary engine driving operational efficiency and customer retention across key regional markets. Management described fulfillment as central to its competitive position because it enables end-to-end control of the shopping experience while improving service quality, customer satisfaction and conversion.
The network has expanded to more than 50 facilities and handled 55% of total shipments in the first quarter of 2026, while same- and next-day shipments climbed 39% year over year to 199 million, reflecting the company’s ability to process rapidly growing order volumes. The acceleration has been particularly notable in Brazil, where logistics investments continue to support marketplace expansion. Overall managed network penetration expanded to 95.5%, illustrating deep integration across seller channels.
The significance extends beyond speed. MercadoLibre emphasized that greater shipment density is steadily lowering unit shipping costs even as volumes continue to surge. Management highlighted a 17% year-over-year reduction in shipping costs in Brazil (in local currency), driven by better facility utilization, route optimization, technology improvements and greater use of its slow-shipping network.
These efficiency gains are helping offset the economics of expanded free-shipping initiatives while maintaining high service standards. Rather than viewing fulfillment as a cost center, MercadoLibre increasingly treats it as a structural advantage that strengthens buyer retention, improves seller competitiveness and expands e-commerce adoption across Latin America.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares tumble 14.8% over the past six months compared with the industry’s 2.3% decline. While Amazon shares have jumped 3.5%, Sea Limited has fallen 14.9% in the aforementioned period.
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From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 35.66, higher than the industry average of 22.07. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 25.82) and Sea Limited (21.26).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4.1%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 44.4% growth in earnings.
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MELI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre v 1. čtvrtletí 2026 vydala 2,7 milionu kreditních karet a portfolio kreditních karet meziročně vzrostlo o 104 % na 6,6 miliardy USD. Podíl nesplácených úvěrů 15–90 dní klesl o 80 bazických bodů.
Key Takeaways MercadoLibre issued 2.7 million cards in Q1 2026, lifting its card portfolio 104% to $6.6 billion.The card boosts marketplace conversion, GMV per user and transaction frequency through cross-selling.Its 15-90-day NPL ratio fell 80 basis points as expansion advanced in Mexico and Argentina. MercadoLibre, Inc. (MELI - Free Report) continues to deepen its ecosystem integration through its credit card business, which is emerging as a central driver of user engagement. During the first quarter of 2026, the company issued 2.7 million credit cards, expanding its credit card portfolio by 104% year over year to $6.6 billion. This growth brought credit card balances to 46% of the total credit portfolio, up from 42% in the prior-year period. Total payment volume for credit cards surged 90% year over year, while monthly active users increased 68%.
The credit card plays a strategic role in converting marketplace-only buyers into active fintech participants. Management emphasizes that this product strengthens the cross-sell flywheel by lifting marketplace conversion rates, boosting gross merchandise volume per user and increasing overall transaction frequency across the platform. Rich proprietary data from marketplace interactions allows the firm to enhance underwriting precision continuously. As a result, credit asset quality improved as the card’s 15-90-day non-performing loan ratio declined by 80 basis points year over year.
In Brazil, older cardholder cohorts are maturing steadily, helping offset the initial margin dilution associated with rapid card expansion. Based on predictable payback periods and solid credit performance, MercadoLibre is expanding credit card issuance in Mexico and scaling early-stage efforts in Argentina. By combining high consumer engagement with refined risk models, the credit card operation proves that fintech expansion directly reinforces core marketplace performance.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares tumble 15% over the past six months compared with the industry’s 2.5% decline. While Amazon shares have jumped 6.6%, Sea Limited has fallen 14% in the aforementioned period.
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From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio stands at 35.89, higher than the industry’s ratio of 21.92. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (with a forward 12-month P/E ratio of 26.08) and Sea Limited (21.16).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4.1%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 44.4% growth in earnings.
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MELI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre v 1. čtvrtletí 2026 zvýšila cross-border GMV o 68 % meziročně na bázi očištěné o vliv kurzů. Růst táhly free shipping, multi-seller košíky a silnější nabídka z Číny.
Key Takeaways MercadoLibre's cross-border GMV rose 68% year over year on an FX-neutral basis in Q1 2026.Free shipping, multi-seller carts, seller incentives and a China fulfillment center reduced friction.Argentina and Andean markets are adding growth as broader assortment supports the model's scale. MercadoLibre, Inc. (MELI - Free Report) is aggressively scaling its cross-border trade as a potential long-term growth driver. The company recorded impressive 68% year-over-year, foreign-exchange-neutral gross merchandise volume growth for the segment in the first quarter of 2026. This momentum indicates that international commerce is becoming a crucial operational layer alongside the core local marketplace.
The company believes it holds a unique position by connecting merchants in China and the United States with buyers across Latin America. Chinese suppliers, in particular, offer competitive prices, rapid product innovation and broad merchandise selection, helping MercadoLibre address growing consumer demand for affordability and assortment.
The business underwent meaningful changes during 2025. MercadoLibre simplified access to free shipping, introduced multi-seller shopping carts, expanded seller incentives and increased its presence in China, including opening its first fulfillment center there. These initiatives were designed to remove friction from the international drop-shipping model while improving execution and merchant relationships.
Growth is no longer concentrated in Mexico alone. Argentina and the Andean countries are contributing more meaningfully to cross-border trade growth, while markets such as Colombia and Peru benefit from broader product assortment where local seller networks are less developed.
MercadoLibre believes this model can become profitable as scale improves. By expanding product availability, improving delivery capabilities and strengthening merchant participation, cross-border trade is evolving into an increasingly important component of the company's marketplace strategy rather than simply an incremental international offering.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares tumble 11.1% over the past six months compared with the industry’s 3.4% decline. While shares of Amazon have jumped 3.8%, those of Sea Limited have fallen 10.8% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio stands at 36.43, higher than the industry’s ratio of 21.94. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (with a forward 12-month P/E ratio of 25.97) and Sea Limited (22.29).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 47% growth in earnings.
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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
After MercadoLibre (MELI +0.85%) delivered another year of more than 30% revenue growth in 2025, you might have expected the stock to surge. Instead, the stock went the other way.
Why? Because the narrative surrounding MercadoLibre has changed. A few years ago, investors were asking how big the company could become. Today, they're asking whether it can sustain its growth while protecting profitability.
That shift in sentiment has weighed on MercadoLibre stock. But it also raises an important question: Has the market become too pessimistic about one of Latin America's highest-quality technology companies?
Image source: Getty Images.
Why have investors become more cautious? MercadoLibre's business isn't slowing down. In fact, in the first quarter, revenue grew 49% year over year. What has changed is that its economics have simply become more complicated.
Over the past year, the company has invested aggressively to solidify its leadership in the e-commerce and fintech spaces in its core markets. It has expanded its logistics network, lowered free-shipping thresholds in Brazil, and continued pouring capital into Mercado Pago.
Those investments have strengthened the platform, but they've also increased costs.
At the same time, competition has intensified. Sea Limited's Shopee is competing aggressively in Brazil through shipping subsidies and attractive seller incentives. PDD Holdings' Temu is reshaping consumer expectations around pricing with ultra-cheap goods shipped from China.
As a result, MercadoLibre's operating margins have come under pressure, almost halving from 12.9% to 6.9%.
In other words, the market isn't questioning whether MercadoLibre can continue growing. It's questioning whether that growth will create long-term shareholder value.
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The business is getting stronger Ironically, if you ignored the share price and looked only at the operating business, you might conclude MercadoLibre is stronger today than it was three years ago.
Revenue is growing at an impressive pace. Gross merchandise volume keeps climbing. Mercado Pago is expanding across payments, lending, investments, and digital banking. Meanwhile, Mercado Ads has become another meaningful growth engine, allowing the company to monetize its marketplace more effectively.
More importantly, these businesses reinforce one another. The marketplace attracts buyers and merchants. Mercado Pago makes transactions easier while deepening customer relationships. Mercado Envios improves delivery speed and reliability. Mercado Ads gives merchants another reason to invest in the platform.
Each business becomes more valuable because the others exist. That integrated model makes MercadoLibre increasingly difficult to replicate, even as competition intensifies.
Has the valuation become more attractive? The market's increasingly cautious stance toward the company has had another effect: The stock's valuation has become far more reasonable.
During the COVID-19 pandemic, investors valued MercadoLibre like a high-growth marketplace with enormous potential. Today, the company has evolved into a much larger and more diversified business, yet it trades at a price-to-sales (PS) multiple of 2.9, well below the double-digit PS multiples seen during the 2020 and 2021 boom.
That lower valuation reflects legitimate concerns. Investors want proof that today's heavy investments will eventually translate into stronger margins, higher earnings, and expanding free cash flow.
But that's also where the opportunity may lie. If management succeeds in turning today's logistics investments, fintech expansion, and merchant services into stronger long-term economics, today's valuation could prove surprisingly attractive in hindsight.
What does it mean for investors? Calling any stock a once-in-a-decade buying opportunity sets an exceptionally high bar.
MercadoLibre hasn't earned that label with certainty. E-commerce competition remains intense. Margin pressure could persist longer than investors expect. And Latin America's macroeconomic environment has never been easy to navigate.
Yet the ingredients of an exceptional long-term investment remain firmly in place. MercadoLibre benefits from a dominant market position, several secular growth drivers, expanding network effects, and a management team that's willing to invest for the long term rather than maximize short-term earnings.
The best investments rarely look obvious when expectations are low. They emerge when a great business continues improving while the market focuses on near-term uncertainty.
NEW YORK--(BUSINESS WIRE)--The law firm of Kirby McInerney LLP continues its investigation on behalf of MercadoLibre, Inc, (“MercadoLibre” or the “Company”) (NASDAQ:MELI) investors concerning the Company’s and/or members of its senior management’s possible violation of the federal securities laws and other unlawful business practices.
[LEARN MORE ABOUT THE INVESTIGATION]
What Happened?
On May 7, 2026, MercadoLibre released its first quarter 2026 financial results and disclosed that loans which were “typically on average of 5 months” had now “moved to 8 months” and that the Company is “taking provisions in Brazil... related on the one hand, to extending the average term of our loans.” On this news, the price of MercadoLibre shares declined by $246.49 per share, or approximately 13.12%, from $1,879.01 per share on May 7, 2026 to close at $1,632.52 on May 8, 2026.
What Should I Do?
At this stage, no lawsuit has been filed. The investigation is ongoing to determine whether claims may be brought under federal securities laws.
If you purchased or otherwise acquired Mercado securities, have information, or would like to learn more about this investigation, please contact Lauren Molinaro of Kirby McInerney LLP by email at [email protected], or fill out the contact form below, to discuss your rights or interests with respect to these matters at no cost.
[LEARN MORE ABOUT SECURITIES CLASS ACTIONS]
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
MercadoLibre dál roste, tržby meziročně stouply o více než 30 % na 29 miliard USD. Investoři ale řeší nižší ziskovost, protože čistá marže klesla z 10,5 % ve 4. čtvrtletí 2024 na 6,4 % ve 4. čtvrtletí 2025.
When investors think about MercadoLibre (MELI +1.11%), they typically think of one of the world's best growth stories. The company has spent years building Latin America's leading e-commerce marketplace, while simultaneously growing Mercado Pago into one of the region's largest digital financial platforms.
Yet, despite another year of impressive operating results, the stock hasn't rewarded investors as it once did. So what's happening?
The answer isn't slowing growth. It's that investors have become increasingly concerned about MercadoLibre's cost of maintaining that growth.
Image source: Getty Images.
Growth isn't the problem By almost every operating measure, MercadoLibre is executing exceptionally well. Revenue has grown by more than 30% year over year to $29 billion, supported by healthy increases in gross merchandise volume, unique buyers, and payment volume.
Payments platform Mercado Pago is attracting new users while expanding deeper into lending, investments, and digital banking. Meanwhile, the company is investing billions of dollars to strengthen its logistics network and payments infrastructure across Brazil, Mexico, and Argentina.
These aren't the numbers of a business that's losing momentum. Instead, they reinforce the same long-term investment thesis that has driven MercadoLibre's success for years: Latin America's digital economy remains underpenetrated, and the company continues to strengthen its leadership position.
If growth were the only thing investors cared about, MercadoLibre's stock would probably be performing much better.
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Investors are becoming less tolerant of lower margins Instead, the market's attention has shifted to profitability.
During 2025, MercadoLibre increased spending on logistics, lowered free-shipping thresholds in Brazil, and leaned more heavily on promotions to defend its competitive position. Those investments helped drive higher engagement and transaction volumes, but they also weighed on operating margins. For perspective, net margin has fallen from 10.5% in the fourth quarter of 2024 to 6.4% in the fourth quarter of 2025.
That has created a different debate among investors. The question is no longer whether MercadoLibre can continue growing. It's whether that growth is becoming more expensive.
This distinction matters because companies can grow revenue for years while delivering disappointing shareholder returns -- if profitability fails to keep pace. In short, investors have become increasingly focused on whether MercadoLibre can eventually convert its scale into stronger earnings and free cash flow.
Competition has intensified in recent years Part of that concern stems from a more competitive landscape.
Shopee, a subsidiary of Sea Limited, has continued expanding aggressively in Brazil through shipping subsidies, attractive seller incentives, and low prices. Another newcomer, Temu, a subsidiary of PDD Holdings, has reset consumer expectations by offering ultra-cheap products shipped directly from China. On the fintech side, Nu Holdings is competing for consumers' wallets and financial relationships.
None of these companies individually poses a threat to MercadoLibre's leadership. Collectively, however, they force MercadoLibre to invest more aggressively to defend its ecosystem. For perspective, the company aims to invest $11 billion in its Brazilian market in 2026, up 50% from 2025.
That has important implications for investors. Competition doesn't have to reduce MercadoLibre's market share to affect the business. Just defending its leadership may require permanently higher logistics spending, more promotions, or lower seller fees, which could impact the company's long-term profitability.
What does it mean for investors? MercadoLibre remains one of the strongest businesses in Latin America. Its marketplace, logistics network, and fintech ecosystem reinforce one another, creating competitive advantages that few companies in the region can match.
But the stock is no longer being judged solely on growth. Investors also want proof that MercadoLibre can translate its expanding ecosystem into improving profitability. Until that happens, the stock may continue to experience volatility, even as the underlying business scales. Long-term investors need to be aware of this.
MercadoLibre rozšiřuje AI napříč obchodem i fintech; LLM vyhledávání v Brazílii, Mexiku a Argentině zlepšilo relevanci, konverze i prokliky u sponzorovaných nabídek. AI podporuje také Seller Assistant, logistiku, Mercado Pago a interní vývoj.
Key Takeaways MercadoLibre is expanding AI across commerce and fintech to boost efficiency, UX and revenues.MercadoLibre's LLM search improved relevance, conversions and sponsored listing click-throughs.MercadoLibre uses AI in Seller Assistant, logistics, Mercado Pago and internal development. MercadoLibre, Inc. (MELI - Free Report) is expanding the use of artificial intelligence (AI) across its commerce and fintech ecosystem, with management highlighting AI as an increasingly important tool for improving efficiency, enhancing user experiences and generating incremental revenues. The company is embedding AI across multiple parts of its business to improve customer experiences and increase productivity.
One of the most notable developments in the first quarter of 2026 was the rollout of an AI-powered search experience built on large language models. The new system moves beyond traditional keyword-based searches by better understanding customer intent. Management said the rollout in Brazil and Mexico improved product relevance, resulting in higher conversion rates and stronger click-through rates for sponsored listings, which generated incremental revenues.
During the first-quarter earnings call, management added that the technology is already live in Brazil, Mexico and Argentina, where it is enhancing product discovery, strengthening user engagement and improving ad returns through more relevant search results.
Beyond search, artificial intelligence is increasingly supporting operational efficiency across the business. MercadoLibre reported that daily active users of its Seller Assistant grew more than 40% month over month in March. Within its logistics network, an AI-powered assistant provides representatives with real-time process information and insights into operational challenges, helping improve productivity across fulfillment.
In Brazil, Mercado Pago's AI assistant has become more proactive by alerting users to negative balances in accounts connected through Open Finance and identifying funds held elsewhere that could earn higher yields with Mercado Pago. It can also move balances between accounts within seconds, enabling users to act immediately on those opportunities.
Internally, AI adoption is also improving software development efficiency, with productivity metrics growing seven to 10 times faster than headcount growth, while code rollbacks have declined materially year over year. MercadoLibre has also deployed Claude Cowork to approximately 31,000 employees, supporting broader AI adoption across the organization.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares jump 3.7% over the past three months compared with the industry’s 8.9% rise. While shares of Amazon have rallied 14.4%, those of Sea Limited have advanced 28.9% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio stands at 35.52, higher than the industry’s ratio of 21.40. The stock is also trading above its 12-month median level of 34.47.
MercadoLibre is trading at a premium to Amazon (with a forward 12-month P/E ratio of 25.72) and Sea Limited (21.29).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 47% growth in earnings.
The consensus estimate for earnings per share for the current and next fiscal year has fallen by $6.87 and $6.95 to $40.97 and $60.22, respectively, over the past 60 days.
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MELI currently carries a Zacks Rank #5 (Strong Sell). The rank reflects near-term earnings pressure despite the company’s strong top-line momentum. Although revenues increased 49% year over year in the first quarter, operating margin fell to 6.9% from 12.9% a year ago, and Net Interest Margin After Losses declined to 17.8% from 22.7% as the credit portfolio expanded. With accelerated investments continuing to weigh on profitability, earnings leverage may remain limited in the near term. The Zacks Consensus Estimate for second-quarter earnings calls for a 15.7% year-over-year decline.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre v prvním pololetí 2026 oslabila o 16 %, protože jí dva po sobě jdoucí kvartály klesal zisk. Přesto tržby v 1. čtvrtletí vzrostly o 49 % meziročně.
MercadoLibre (MELI +1.27%) Stock fell 16% in the first half of 2026, according to data provided by S&P Global Market Intelligence. It reported declining profits for two consecutive quarters.
The dominant tech company in Latin America MercadoLibre enjoys a leading position in e-commerce and fintech in 18 Latin American countries. It consistently demonstrates high growth as it generates a shift to online shopping, and since its markets lag behind other global regions, it still has a vast opportunity. For example, e-commerce penetration in the U.S. is 27%, while it's only 14% in Latin America.
Image source: Getty Images.
The company is reporting incredible growth across segments and metrics. Total revenue increased 49% year over year in the 2026 first quarter, driven by both e-commerce and fintech. In e-commerce, gross merchandise volume (GMV) was up 42% over last year, with a 26% increase in unique active buyers. Items sold were up 47%, and items sold per unique buyer were up 16%. That's particularly impressive considering the number of new customers.
There was major growth in Brazil, its largest market, since it lowered its free shipping threshold in the country from $R79 to $R19.
Fintech is a similar story. Total payment volume was up 50% year over year, with a 29% increase in monthly active users to 83 million. The credit portfolio was up 87%, and assets under management were up 77%.
Laying the groundwork for the future Despite the fantastic performance, MercadoLibre stock has plunged because profits are declining. In the first quarter, operating income fell 20% from last year, and operating margin dropped from 12.9% last year to 6.9% this year.
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Management says it's focusing on the future. It sees a massive long-term opportunity, and it has the potential to gain the most with its first-mover's edge. "When your business is behaving like this, we believe the right response is not to harvest -- it is to invest," it said.
In Mexico, for example, more than half of the population relies on informal credit sources, while 85% pays for purchases under $30 with cash. In Argentina, while 80% of the population has a bank account, its use of credit is far below that of Brazil. Management sees the region as ripe for continued disruption, and the company has high customer satisfaction, which it takes as a mandate to improve the industry.
At the current price, MercadoLibre stock trades at 47 times trailing 12-month earnings, an attractive entry point for new investors.
MercadoLibre zůstává pod tlakem, protože agresivní investice stlačují marže, i když tržby dál rychle rostou. Celkové tržby v konstantní měně vzrostly o 46 % meziročně.
The market is soaring, but MercadoLibre (MELI +1.27%) is down 30% over the past year. Investors have soured on the Latin American financial technology and e-commerce player because of its aggressive investments, which are eroding profit margins.
It has been left for dead, with shares up only 10% over the last five years, while the broad market S&P 500 index is up close to 100% over the same timeframe. However, it's at this moment that MercadoLibre looks like a fantastic investment for anyone with a time horizon longer than next quarter. Here's why you should consider buying even more of MercadoLibre as the stock inches lower.
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Playing the long game MercadoLibre operates in two sectors with some strong overlap: financial technology and e-commerce. In e-commerce, it is building an "everything store" similar to Amazon in Latin American countries, investing in fast delivery, a wide selection, and a bundled subscription offering.
Its current crop of investments in free delivery for close to all orders in Brazil has temporarily reduced profit margins. At the same time, it has accelerated revenue growth in the country. In Q1 2026, total commerce revenue grew 47% year over year last quarter in constant currency, on top of 57% growth in the same quarter a year ago.
More buyers, more shopping volume, and more revenue are being spent on MercadoLibre's e-commerce marketplace. This will mean a short-term hit to margins, but it should also lead to a long-term competitive advantage for the business. The same can be said for its MercadoPago consumer finance segment. MercadoPago is accelerating its acquisition of credit card customers to deepen its relationship as a banking application and drive more spending on the MercadoLibre online marketplace.
When a credit card customer is acquired, it requires the bank -- in this case, MercadoLibre -- to allocate loan losses over the life of the customer relationship, which means an upfront hit to margins if many customers are acquired. With all these new credit card customers, MercadoLibre's fintech revenue grew 54% year over year last quarter.
Overall, MercadoLibre's revenue is growing 46% year over year in constant currency, making it one of the fastest-growing large-cap technology players today. However, investors are still not happy because of the short-term hit this accelerated growth has had on profit margins.
Image source: Getty Images.
Why MercadoLibre's stock is cheap today Last quarter, MercadoLibre's overall operating margin fell to 6.9%, and it may fall further in the quarters ahead due to the upfront investments discussed above. This has investors very nervous, but it should not be misconstrued as MercadoLibre losing its lead in e-commerce and consumer finance in Latin America.
Long-term, MercadoLibre should be able to regain or surpass its previous high profit margin of 16%, if not exceed it, due to increased scale, higher-margin fintech revenue, and faster-growing advertising revenue (which is growing faster than the overall business). Combined with a business with a long history of growing revenue at a fast, double-digit rate, it is plausible that the company's revenue of $31.8 billion could climb to $100 billion over the next five years or so. A 15% profit margin would equate to $15 billion in earnings for MercadoLibre five years from now.
Today, MercadoLibre's stock trades at a market cap of $88 billion. Assuming the stock trades at 20x earnings five years from now -- which is a reasonable level for a fast-growing stock, if not a discount -- then MercadoLibre will have a market cap of $300 billion within five years. Buying at today's market cap would deliver north of 20% annualized returns before dividends or buybacks, likely beating the market. This makes MercadoLibre an easy stock to buy on the dip right now.
Brazílie se stává klíčovým růstovým motorem MercadoLibre: GMV bez vlivu FX vzrostl v 1. čtvrtletí o 38 % a prodané kusy o 56 %. Nižší hranice dopravy zdarma přilákala nové zákazníky a snížila náklady na dopravu o 17 % v místní měně.
Key Takeaways Brazil's FX-neutral GMV growth rose to 38%, while items sold surged 56% in the first quarter.Lower free shipping threshold helped attract new customers and lift purchase frequency in Brazil.Brazil unit shipping costs fell 17% in local currency as same and next-day shipments rose 39%. MercadoLibre, Inc.’s (MELI - Free Report) first-quarter 2026 performance suggests Brazil is becoming one of the important growth engines. While the company continued to deliver healthy momentum across Latin America, Brazil stood out for accelerating growth in both commerce and customer engagement, supported by sustained investments in logistics, pricing and the user experience. The market has evolved beyond being MercadoLibre’s largest contributor by scale and is now driving some of its strongest operating trends.
The clearest evidence came from the marketplace business. Brazil’s FX-neutral gross merchandise volume (GMV) growth accelerated to 38% in the first quarter from 35% in the preceding quarter, while items sold surged 56%, up from 45% in the fourth quarter and 42% in the third quarter of 2025. The company attributed the improvement largely to its lower free-shipping threshold, which continued to attract new customers and encourage higher purchase frequency. Brazil also fueled a record year-over-year increase of 17 million unique active buyers, helping MercadoLibre’s total unique active buyers grow 26%.
The stronger demand is also improving operating efficiency. Same and next-day shipments increased 39% year over year, driven particularly by accelerating volumes in Brazil. At the same time, unit shipping costs in Brazil declined 17% in local currency from the prior year, improving from an 11% reduction in the preceding quarter despite significantly higher shipment volumes. This demonstrates that rising scale is helping offset the costs of MercadoLibre’s free-shipping initiatives.
Brazil is also reinforcing MercadoLibre’s broader ecosystem strategy. The company highlighted continued strength in Mercado Pago, while its credit card business in Brazil has reached a stage where older customer cohorts are maturing as expected, supporting further expansion. Together, these trends suggest Brazil is no longer just MercadoLibre’s biggest market by scale, but one of the clearest drivers behind its accelerating marketplace growth.
What the Latest Metrics Say About MercadoLibreMercadoLibre, which competes with Amazon.com, Inc. (AMZN - Free Report) and Sea Limited (SE - Free Report) , has seen its shares jump 1.6% over the past three months compared with the industry’s 7.3% rise. While shares of Amazon have rallied 15.3%, those of Sea Limited have advanced 24.4% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio stands at 34.42, higher than the industry’s ratio of 21.07. The stock is trading marginally below its 12-month median level of 34.44.
MercadoLibre is trading at a premium to Amazon (with a forward 12-month P/E ratio of 25.61) and Sea Limited (20.54).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales and earnings per share implies year-over-year growth of 39.7% and 4%, respectively. For the next fiscal year, the consensus estimate indicates a 26.6% rise in sales and 47% growth in earnings.
The consensus estimate for earnings per share for the current and next fiscal year has fallen by $6.87 and $6.95 to $40.97 and $60.22, respectively, over the past 30 days.
Image Source: Zacks Investment Research
MELI currently carries a Zacks Rank #5 (Strong Sell). The rank reflects near-term earnings pressure despite the company’s strong top-line momentum. Although revenues increased 49% year over year in the first quarter, operating margin fell to 6.9% from 12.9% a year ago, and Net Interest Margin After Losses declined to 17.8% from 22.7% as the credit portfolio expanded. With accelerated investments continuing to weigh on profitability, earnings leverage may remain limited in the near term. The Zacks Consensus Estimate for second-quarter earnings calls for a 15.7% year-over-year decline.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MercadoLibre vzrostl o 2,64 % na 1 742,19 USD, zatímco S&P 500 klesl o 0,22 %. Před zveřejněním výsledků trh očekává EPS 8,69 USD a tržby 9,77 miliardy USD.
MercadoLibre (MELI - Free Report) ended the recent trading session at $1,742.19, demonstrating a +2.64% change from the preceding day's closing price. The stock exceeded the S&P 500, which registered a loss of 0.22% for the day. At the same time, the Dow lost 0.03%, and the tech-heavy Nasdaq lost 0.66%.
Shares of the operator of an online marketplace and payments system in Latin America witnessed a gain of 1.47% over the previous month, beating the performance of the Retail-Wholesale sector with its loss of 5.51%, and the S&P 500's loss of 1.21%.
The upcoming earnings release of MercadoLibre will be of great interest to investors. The company's upcoming EPS is projected at $8.69, signifying a 15.71% drop compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $9.77 billion, indicating a 43.9% growth compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $40.97 per share and a revenue of $40.36 billion, indicating changes of +3.98% and +39.68%, respectively, from the former year.
Investors might also notice recent changes to analyst estimates for MercadoLibre. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. MercadoLibre is currently sporting a Zacks Rank of #5 (Strong Sell).
Looking at its valuation, MercadoLibre is holding a Forward P/E ratio of 41.43. This expresses a premium compared to the average Forward P/E of 17.07 of its industry.
Investors should also note that MELI has a PEG ratio of 1.05 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Internet - Commerce industry had an average PEG ratio of 1.06 as trading concluded yesterday.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 182, which puts it in the bottom 27% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
MercadoLibre ve 1. čtvrtletí zvýšila tržby o 49 %, ale provozní zisk klesl z 763 mil. USD na 611 mil. USD kvůli silnější konkurenci v Brazílii. Akcie jsou za poslední rok asi o 36 % níže.
MercadoLibre (MELI +3.06%) might not be a household name in the U.S., but Foolish investors know the Latin American e-commerce company as a standout on the stock market.
Since its 2007 IPO, MercadoLibre is up more than 5,000%, and it's built an Amazon-like network of businesses as it expands across Latin America, including in logistics, fintech, credit, and asset management. It's also added its Prime-like MELI+ membership program to help lock customers into its ecosystem.
While MercadoLibre has continued to put up strong growth numbers, the stock has struggled over the last year, falling 36% in a steady decline.
MELI data by YCharts
That sell-off isn't unwarranted, as there are several reasons why investors have sold off MercadoLibre stock. Let's take a look at those challenges before discussing whether MercadoLibre is a buy.
Image source: MercadoLibre.
What's ailing MercadoLibre? The biggest reason for MercadoLibre's slide is that its profits are falling. In the first quarter, despite a 49% jump in revenue, operating income slipped from $763 million to $611 million.
The decline in profits has come primarily as the company has faced increased competition in Brazil from Sea Limited's Shopee, PDD Holdings' Temu, Amazon, and others. Brazil is MercadoLibre's biggest market, representing about half of its revenue.
To push back against competition, MercadoLibre lowered its free shipping threshold in Brazil, or the minimum order value to get free shipping, which helped accelerate GMV growth to a currency-neutral 38%.
Management first introduced free shipping in 2016, which had a similar headwind on profit margins, but paid off over the longer run, and it expects the lower free shipping threshold to do the same.
The company is also investing in cross-border trade for merchants in China and the U.S., giving them the option to work with the regional leader rather than Amazon or Temu. It's given sellers easier access to free shipping and other incentives, and it opened its first fulfillment center in China to improve relationships with merchants there.
MercadoLibre's margins are also compressing due to the growth of lower-margin businesses, including its first-party e-commerce business and its credit business, which saw a modest rise in delinquency rates in the first quarter.
The credit business introduces a new risk for MercadoLibre, but management sees it as a key driver for the company's two principal businesses, e-commerce and fintech. Its credit portfolio increased 87% to $14.6 billion in the first quarter, and it issued 2.7 million MercadoPago credit cards.
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It's understandable why falling profits would send MercadoLibre stock lower. After all, this is a stock that has historically traded at a premium valuation priced for growth.
However, the overall picture of the company is that the margin compression is primarily the result of its own decision-making to prioritize long-term growth over short-term profits in a shifting competitive landscape. That's a smart move, and it's similar to the strategy that worked so well for Amazon.
While competition may be impacting MercadoLibre's performance, market share wars don't last forever, as the experience of industries like ridesharing and food delivery has shown. Additionally, MercadoLibre actually gained market share in the first quarter, and its structural advantages, like its MercadoEnvios logistics network, should ensure that it maintains its leadership in Brazil and elsewhere. Management also believes that there's a long runway for growth in Latin American e-commerce as the average Latin American makes just seven online purchases a year, compared to 41 for the average American, so there can be more than one winner here.
The margin pullback is likely temporary, and these investments should pay off. In the meantime, MercadoLibre continues to deliver strong revenue growth, up 49% in the first quarter, a sign of a healthy business despite the bottom-line woes.
With the e-commerce stock down nearly 40% from its peak, MercadoLibre is worth buying here. The long-term growth outlook still looks strong.
MercadoLibre rychle rozšiřuje 1P byznys, který ve 1. čtvrtletí 2026 vzrostl o 69 % a tlačí na marže. Hrubá marže klesla meziročně o 300 bazických bodů.
Key Takeaways MELI is rapidly expanding its first-party business to boost assortment and pricing competitiveness.MELI's first-party growth is increasing logistics, warehousing and inventory management demands.MELI continues prioritizing market-share gains as margin recovery remains challenging. MercadoLibre's (MELI - Free Report) aggressive expansion of its first-party (1P) business is emerging as a key headwind to margin recovery. While the strategy is strengthening assortment, improving pricing competitiveness and helping the company gain share across key categories, the rapid scaling of inventory-led commerce is introducing structural profitability pressures that could weigh on operating leverage for longer than anticipated.
The company's 1P gross merchandise volume grew 69% year over year on a foreign exchange-neutral basis in the first quarter of 2026, significantly outpacing overall marketplace growth. The strategy has been particularly effective in consumer electronics, where MercadoLibre has expanded its competitive position through broader selection and sharper pricing. However, unlike the higher-margin third-party marketplace model, 1P requires inventory ownership, procurement spending and greater fulfillment intensity. As the business scales, associated logistics, warehousing and inventory management costs are likely to rise alongside volume growth, creating a more capital-intensive operating profile.
Gross margin contracted 300 basis points year over year in the first quarter of 2026, with rapid 1P expansion among the key drivers of the decline. Although profitability within certain mature 1P categories has improved, the broader business continues to absorb a growing share of corporate allocations as it scales faster than the overall marketplace. This dynamic suggests margin dilution will likely persist even as scale benefits gradually emerge.
MercadoLibre appears willing to continue prioritizing market-share gains and ecosystem expansion over near-term earnings optimization. As 1P continues to outpace the broader marketplace and absorb a growing share of corporate costs, the path toward margin normalization is expected to remain challenging.
MELI Faces Stiff CompetitionMELI faces stiff competition from Amazon (AMZN - Free Report) and Alibaba (BABA - Free Report) , both of which have expanded logistics and inventory-led commerce capabilities to strengthen user engagement and pricing competitiveness.
Amazon continues to scale its first-party retail network despite persistent fulfillment cost pressures, and its scale advantage sets a high bar for efficiency. Alibaba has likewise increased investments across direct retail and supply-chain infrastructure, navigating similar margin trade-offs as it defends its share.
Unlike Amazon and Alibaba, MELI is expanding 1P while simultaneously ramping fintech, free shipping and logistics spend, which could keep profitability under pressure for longer.
MELI’s Share Price Performance, Valuation and EstimatesMELI shares have declined 18.8% in the year-to-date (YTD) period, and the Zacks Internet–Commerce industry and the Zacks Retail-Wholesale sector have declined 4.5% and 0.9%, respectively.
MELI’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, MELI is currently trading at a forward 12-month Price/Sales ratio of 1.83X compared with the industry’s 1.99X. MELI has a Value Score of F.
MELI's Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MELI’s 2026 earnings is pegged at $40.97 per share, indicating a 3.98% year-over-year increase.
