MercadoLibre Q3 Revenue Grows 45% but Operating Margins Decline Amid Increased Logistics and Credit Costs
MercadoLibre (MELI) reported third-quarter revenue of approximately $10.8 billion, a 45% increase year-over-year. However, the company's operating income fell 6% to $676 million as margins were squeezed by rising expenditures in shipping, marketing, and credit services. Currency-neutral growth has slowed for the fourth consecutive quarter, dropping to 41% from 43% in the previous quarter. The margin compression is largely attributed to logistics investments, including a 20% increase in warehouse space, and higher costs associated with free shipping initiatives in Brazil. Additionally, the company's rapidly expanding credit portfolio—now nearly $18 billion—has led to a significant rise in provisions for doubtful accounts. While net income rose 6%, this was driven by lower tax bills and reduced currency losses rather than core operational strength.
Tickers: $MELI
Topics: Credit Portfolio Logistics Costs Operating Margin Revenue Growth