MercadoLibre reported strong Q3 2025 earnings with a 39% year-over-year revenue growth, reaching $7.41 billion.
Revenue growth was 49% on a FXN basis
Operating income rose 30% YoY to $724 million, with a margin of 9.8%.Net income increased modestly by 6% to $421 million.
Total Payment Volume (TPV) grew 41% to $71.2 billion.
Gross Merchandise Volume (GMV) increased 28% to $16.5 billion.
The fintech segment revenue surged 49%, driven by digital payment adoption in Brazil, Mexico, and Argentina.
Credit portfolio grew 83% YoY to $11 billion.
I really liked this report from MELI and the call sounded very optimistic. I like how management is focusing on revenue growth at the cost of margins in the short term. Establishing logistic networks seems like a high priority and I feel like it is a good moat in this area of the world. Hopefully the Argintine Peso and Brazilian Real show more strength in the future.
This report makes me more confident in NUs upcoming report as Latin American countries adopt fintech.
I know MELI isn’t the hottest stock around but their continued growth, strong management group and reasonable valuation has forced me to make it a large cornerstone of my portfolios.
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I only date my stocks, I do not marry them. But after 15 years of holding MELI, I think it might be declared a common law marriage. It is the only stock I have carried more than 5 years and in my kids accounts too as a foundation stock. MELI has been largely ignored in 2025 by Mr. Market probably because S. America has a lot of economic problems with Trump political headlines. And competitive threats from Amazon and Sea have been making headlines. But MELI just quietly plows along at 50% YOY growth every year. If you feel it is too late to buy, note it currently has a PEG of about 1.0 and a Forward PE of 32. Competition from AMZN and Sea has been around for years with little impact to MELI. MELI always navigates each country’s currency and economic turmoil. Always. Of course with MELI you must ignore the FXN as they report in dollars. This creates some volatility in Wall Street and the stock price. I always judge them in their own currency to get a true reflection of their real performance. MELI is like an old MF Boring stock but with aggressive performance. Stock appreciation is always lumpy but dependable YOY. I should add a note on GPM margins declined this quarter as did EPS. Sharply missed FCF estimates by $1.1B. This was largely related to its credit portfolio being $900M larger than expected. Further, MELI continues making large investments in country logistics and AI.
Honorable mention goes to NU Bank which will report in 2 weeks. The MELI Q3 ER numbers bode well for NU. This is another Boring aggressive stock.
-zane
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