MELI - MercadoLibre smashes quarterly profit estimates on Mexico Brazil outperformance

2023-11-01 16:42:11 ET

Shares of MercadoLibre ( NASDAQ: MELI ) on Wednesday rose nearly 2% in extended trading, after the Latin American e-commerce giant smashed quarterly profit estimates, helped by a surge in revenue in Mexico and Brazil.

MELI stock was last up 1.9% to $1,324.90 after hours.

MELI posted Q3 earnings per share of $7.18, which significantly beat estimates by a dollar and 35 cents. Revenue surged 41.3% Y/Y to $3.8B, beating expectations by $250M.

MercadoLibre's ( MELI ) income from operations soared 131% Y/Y to hit a new quarterly record of $685M.

The company's key revenue metric, gross merchandise volume (GMV), rose 59.3% Y/Y to $11.4B, while its total payment volume jumped 121.2% Y/Y to $47.3B.

In a letter to shareholders , MELI touted the effect of relaunching its loyalty program during the quarter, which the e-commerce firm kicked-off in Brazil and Mexico in late August through marketing campaigns. The revamped bundle reduced the threshold on free shipping to R$29 from R$79 earlier.

Additionally, MercadoLibre ( MELI ) said its investments into logistics in Q3 helped it hit a record level of fulfillment penetration of 48% of shipments. Broadly stable net shipping costs as a percentage of GMV versus Q2 2023 also helped.

Meanwhile, MELI saw a 27% Y/Y acceleration in items sold in Brazil, which was the highest rate of growth in that country since Q4 2021.

Finally, MELI's fintech revenue showed signs of resurgence in Q3, rising 33% Y/Y and improving from Q2's gain of 24%.

More on MercadoLibre

• MercadoLibre: A Hold Given Current Valuation
• MercadoLibre's Fintech Business: Addressing Concerns
• MercadoLibre Is Becoming A Cash Flow Monster
• MercadoLibre to redeem 2.00% convertible senior notes due 2028 in November, 2023
• MercadoLibre attracts Outperform rating from Wedbush Securities

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