MercadoLibre Q3 Earnings Miss Estimates, Revenues Rise Y/Y

Core Insights - MercadoLibre (MELI) reported Q3 2025 earnings of $8.32 per share, missing estimates by 11.77% but increasing 6.26% year over year. Revenues rose 39.5% year over year to $7.41 billion, surpassing estimates by 2.15% [1][9] Revenue Breakdown - Total revenues were driven by strong growth in commerce and fintech segments, which grew 33% and 49% year over year to $4.17 billion and $3.24 billion, respectively [2] - Brazil generated $4.01 billion in net revenues (54.1% of total), up 37.6% year over year. Mexico's revenues reached $1.65 billion (22.3% of total), increasing 44.2% year over year. Argentina's revenues were $1.44 billion (19.4% of total), reflecting a 39.5% year-over-year increase [5] - Other countries contributed $308 million (4.2% of total revenues), representing a growth of 39.4% year over year [6] Key Metrics - Gross Merchandise Volume (GMV) was $16.5 billion, increasing 28% year over year and 35% on a foreign exchange-neutral basis [7] - Items sold grew 39.3% year over year to 635.2 million, with unique buyers increasing by 26% to 76.8 million [3] - Fintech Monthly Active Users rose 29% year over year to 72.2 million, with Assets Under Management growing 89% to $15.1 billion [3] Advertising and Market Performance - Revenues from advertising services rose 56% year over year on a reported basis and 63% on a foreign exchange-neutral basis [4] - MELI's shares appreciated 35% year-to-date, outperforming the Internet-Commerce industry's return of 12.1% [4] Operating Details - Gross margin contracted to 43.3%, while operating margin declined 70 basis points to 9.8% [9][11] - Operating expenses increased 32% year over year to approximately $2.5 billion, but as a percentage of revenues, it contracted to 33.5% [11] Financial Position - As of September 30, 2025, cash and cash equivalents were $2.58 billion, down from $3.01 billion as of June 30, 2025. Net debt increased to $4.6 billion [13]