MercadoLibre(US:MELI)2025-10-30 20:01Financial Performance - Net revenues and financial income for the nine months ended September 30, 2025, reached $20,134 million, a 36.5% increase from $14,718 million in the same period of 2024[11] - Gross profit for the nine months ended September 30, 2025, was $9,074 million, reflecting a 33.0% increase compared to $6,828 million in the prior year[11] - Net income for the nine months ended September 30, 2025, was $1,438 million, a 13.1% increase from $1,272 million in the same period of 2024[13] - Basic net income available to shareholders per common share for the nine months ended September 30, 2025, was $28.37, compared to $25.09 for the same period in 2024, indicating an increase of 9.1%[11] - Operating expenses for the nine months ended September 30, 2025, totaled $6,762 million, an increase of 34.8% from $5,017 million in the same period of 2024[11] - Total comprehensive income for the nine months ended September 30, 2025, was $1,867 million, significantly higher than $932 million in the same period of 2024[13] - The aggregate gain from financing transactions and sales of financial assets for the nine-month period ended September 30, 2025, was $1,641 million, compared to $1,274 million for the same period in 2024, representing a 28.8% increase[30] Assets and Liabilities - Total assets increased to $36,691 million as of September 30, 2025, up from $25,196 million at December 31, 2024, representing a growth of 45.5%[10] - Total current liabilities rose to $24,522 million as of September 30, 2025, up from $16,603 million at December 31, 2024, marking a 47.8% increase[10] - Total equity increased to $6,218 million as of September 30, 2025, compared to $4,351 million at December 31, 2024, representing a growth of 43.0%[10] - Cash, cash equivalents, and restricted cash at the end of the period were $9,199 million, compared to $3,478 million at the end of September 2024, representing a substantial increase of 164.36%[17] - Total liabilities as of September 30, 2025, amount to $344 million, a decrease from $229 million as of December 31, 2024[100] Currency and Inflation - The inflation rate in Argentina for the nine-month period ended September 30, 2025, was 22.0%, compared to 6.0% for the same period in 2024, indicating a significant increase in inflationary pressures[36] - The average exchange rate for the nine-month period ended September 30, 2025, was 1,180.36 Argentine Pesos per U.S. dollar, reflecting a 33.0% increase from 887.76 Pesos in the same period of 2024[37] - The Company’s estimated effective tax rate increased from 23.8% for the nine-month period ended September 30, 2024, to 30.1% for the same period in 2025, primarily due to lower deductions related to tax inflation adjustments in Argentina[41] Investments and Financing - Investments in property and equipment, intangible assets, and intangible assets at fair value totaled $916 million in 2025, compared to $555 million in 2024, showing an increase of 64.95%[18] - The company created a global program for the issuance of debt securities with a maximum principal amount of $500 million[60] - The company has pending authorization requests in Mexico and Chile for new financial services, including an investment funds management company and cross-border transaction registration[56][61] - The company repurchased common stock worth $1 million in both 2025 and 2024, indicating a consistent approach to capital management[17] Loans and Receivables - The total loans receivable, net, increased to $8,192 million as of September 30, 2025, compared to $4,895 million as of December 31, 2024[72] - The allowance for doubtful accounts for loans receivable was $2,859 million as of September 30, 2025, compared to $1,678 million as of December 31, 2024[72] - The total past due loans receivable rose to $3,006 million as of September 30, 2025, compared to $1,763 million as of December 31, 2024, indicating a significant increase of 70.4%[77] Tax and Legal Matters - The Company recorded an income tax benefit of $50 million for the nine-month period ended September 30, 2025, compared to $6 million for the same period in 2024[44] - A provision of $501 million was recorded for disputed tax amounts as of September 30, 2025, net of judicial deposits of $450 million[111] - The Company recorded a social security benefit of $17 million during the nine-month period ended September 30, 2025, compared to $31 million for the same period in 2024[44] Operational Highlights - The fintech platform, Mercado Pago, is operational in multiple countries, including Argentina, Brazil, Mexico, and Colombia, enhancing the company's market presence in Latin America[21] - The company is actively engaged with the CBA regarding its banking license application in Argentina, which is currently under review[59] - The company held digital assets valued at $65 million for Bitcoin and $13 million for Ether as of September 30, 2025, compared to $6 million for Bitcoin and $10 million for Ether as of December 31, 2024[83]