MELI changes

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View the full Nov 5, 2026 version

Price: $1624.53 → $1512.02(−6.9%)
Next earnings: Nov 4, 2026 → Feb 4, 2027
Next earnings is estimate: No → Yes
About: MercadoLibre runs the largest e-commerce and fintech business in Latin America. Mercado Libre is its online marketplace, with its own delivery network, Mercado Envios, and an advertising business. Mercado Pago gives payments, digital accounts, credit cards, loans, investments and insurance. Its largest markets are Brazil, Mexico and Argentina. In removed: Q2 added: Q3 2026, net revenues and financial income were removed: $10.2 added: $10.75 billion, gross merchandise volume was removed: $21.9 added: $22.8 billion and total payment volume was removed: $101 added: $109 billion. The company is incorporated in Delaware, its shares trade on Nasdaq and it reports in US dollars.
Thesis: The market prices MercadoLibre for lower margins while it invests to grow. removed: Revenue grew 50% in Q2 added: In Q3 2026, added: net revenues and financial income grew 45%, or 41% on an FX-neutral basis, but income from operations fell removed: 17%, added: 6%, and the operating margin fell to removed: 6.7% added: 6.3%, from added: 6.7% in Q2 2026 and 12.2% removed: a year earlier. added: in Q2 2025. The company lowered the free shipping threshold in Brazil, issues many new credit cards that lose money at removed: first added: first, adds fulfillment capacity ahead of peak season and spends on added: marketing, 1P sales, cross-border trade and the MELI+ program. The credit portfolio grew removed: 75% added: 62% to removed: more than $16 added: almost $18 billion. Brazil, its largest market, also had a sharp fall in stocks and in the real on October 26, 2026, after the presidential runoff, according to press reports, and a weaker real lowers profit in US dollars. For the gap to close, three things must be true. Revenue must keep growing quickly, while the operating margin stops falling and starts to recover in 2027. The credit card cohorts must mature and the credit card NIMAL must removed: rise added: keep rising from -2.5% in Q2 added: 2026; the company said that it improved in Q3 2026. Engagement must keep rising, so that the investments in shipping and credit pay back. The removed: Q3 added: Q4 2026 removed: report on November 4, 2026 added: report, expected in February 2027, gives the next test. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is that the company keeps margins low for longer, or that a weak economy in Brazil, Mexico or Argentina raises credit losses.
Risks: Margins. The operating margin fell to 6.7% in Q2 2026 from 12.2% a year earlier, added: and to 6.3% in Q3 2026, because of shipping, credit card and other growth investments. If these investments do not pay back, profit can stay low for a long time. Credit risk. The credit portfolio grew removed: 75% added: 62% in a year to removed: more than $16 added: almost $18 billion in removed: a year, added: Q3 2026, and new credit card cohorts lose money at first. added: The 15 to 90 day non-performing loan ratio was 7.0% in Q3 2026. A weaker economy in Brazil, Mexico or Argentina can raise provisions quickly. Currency and country risk. Most revenue is in Brazilian reais, Mexican pesos and Argentine pesos. After the October 25, 2026 presidential runoff, the real fell sharply, according to press reports. Weaker currencies lower revenue and profit in US dollars. Competition. Large global e-commerce and payments companies compete in all of its markets. More competition can force the company to spend more on shipping, prices and marketing.
Balance sheet: Cash: removed: $6.8B added: $8.1B Debt: removed: $13.2B added: $16.2B Net debt: removed: $6.4B added: $8.0B Debt due within 12 months: removed: $7.0B added: $7.5B MercadoLibre funds its credit book with deposits held by Mercado Pago, securitizations, bank loans and corporate notes. Debt here includes loans payable, other financial liabilities and removed: $2.55 added: $2.96 billion of operating lease liabilities, and cash includes short-term and long-term investments, as the company defines net debt. Net debt rose to removed: $6.43 added: $8.03 billion at removed: June added: September 30, 2026 from $4.68 billion at December 31, 2025, mainly because the credit portfolio grew. added: On September 14, 2026, the company sold $1.0 billion of 5.850% notes due 2036. The amount due within 12 months is current loans payable and other financial liabilities of removed: $6.48 added: $6.91 billion plus current lease liabilities of removed: $0.51 added: $0.60 billion. Restricted cash, mostly customer funds, of removed: $13.1 added: $14.6 billion is not in the cash figure. Adjusted EBITDA was removed: $975 added: $982 million in removed: Q2 added: Q3 2026. Adjusted free cash flow was removed: $214 added: $285 million in removed: Q2 added: Q3 2026, after removed: $441 added: $503 million of capital spending and $2.1 billion of growth in the credit removed: portfolio. On September 14, 2026, after the quarter end, the company sold $1.0 added: portfolio, which $1.5 billion of removed: 5.850% notes due 2036. added: fintech funding partly paid for. As of removed: Jun added: Sep 30, 2026.
Checkpoints: Nov 4, 2026: Q3 2026 results: growth and margin. removed: Pending. added: Failed. Watch: Revenue growth above 35% on an FX-neutral basis with an operating margin at or above the 6.7% of Q2 2026 passes; a lower margin with slower growth fails. added: Outcome: Revenue grew 41% on an FX-neutral basis, but the operating margin fell to 6.3%, below the 6.7% of Q2 2026. Feb added: 4, 2027 (estimate): Q4 2026 results: margin recovery. Pending. Watch: An operating margin above the 6.7% of Q2 2026 and a better credit card NIMAL pass; a further fall in margin fails.
Recent events: added: Nov 4, 2026: MercadoLibre reported Q3 2026 results. Net revenues and financial income rose 45% to $10.75 billion, or 41% on an FX-neutral basis. Income from operations fell 6% to $676 million, a 6.3% margin, because of more free shipping, new fulfillment capacity and more marketing in Brazil. Net income rose 6% to $448 million. The credit portfolio grew 62% to almost $18 billion. The company also said that Netflix will join its connected TV advertising offer from early 2027. Sep 14, 2026: MercadoLibre closed the sale of $1.0 billion of 5.850% notes due 2036. Aug 5, 2026: MercadoLibre reported Q2 2026 results. Net revenues and financial income rose 50% to $10.2 billion, the fastest growth in four years. Income from operations fell 17% to $683 million, a 6.7% margin, and net income fell 11% to $466 million. GMV rose 36% and TPV rose 56% on an FX-neutral basis. The credit portfolio grew 75% to more than $16 billion. May 7, 2026: MercadoLibre reported Q1 2026 results. Net revenues and financial income rose 49% to $8.8 billion. Income from operations fell 20% to $611 million, and net income was $417 million. Feb 24, 2026: MercadoLibre reported 2025 results. Net revenues and financial income rose 39% to $28.9 billion, income from operations rose 22% to $3.2 billion and net income was $2.0 billion, or $39.40 per diluted share. In Q4 2025, revenue rose 45% and the operating margin was 10.1%.