Key Highlights

  • Net revenues and financial income were USD 10,750 million, up 45% year over year and 41% on an FX-neutral basis, with Brazil showing the strongest performance.
  • Income from operations fell 6% to USD 676 million, a 6.3% Margin that was 40 basis points below the second quarter, while Net Income rose 6% to USD 448 million.
  • Total payment Volume reached USD 109 billion, up 53%, and gross merchandise volume reached USD 23 billion, up 38%, or 33% on an FX-neutral basis.
  • The Credit portfolio reached almost USD 18 billion, up 62%, with the 15 to 90 day non-performing Loan ratio at 7.0%, broadly stable year over year.

Free Shipping and Affiliate Spend Squeeze Operating Margin

MercadoLibre (NASDAQ:MELI) reported third-quarter results on November 4, 2026. Operating Income of USD 676 million fell 6% as the company chose to invest margin in growth. Management cited more free shipping, new fulfillment capacity added ahead of peak season, higher energy prices and a tactical rise in affiliate Marketing in Brazil. Shipping created a net 60 basis point sequential headwind, and sales and marketing rose 40 basis points to 11.6% of net revenue. Net income still rose 6% because of a lower tax rate and smaller FX losses of USD 72 million versus USD 102 million. Adjusted free Cash Flow was USD 285 million after USD 503 million of capital expenditure. Product development showed Operating Leverage despite AI Investment rising by almost USD 30 million sequentially.

Brazil Leads Commerce Growth as Mexico Slows

The Latin American E-commerce and Fintech group said it gained share in Brazil, Mexico and Argentina. Brazil FX-neutral gross merchandise volume grew 36% and sold items 45%. Argentina grew 40% FX-neutral, while Mexico slowed to 21% as tax reform and a weaker consumer weighed. Advertising Revenue grew 51% FX-neutral, or 58% in dollars, and an AI advisor now manages campaigns for 56,000 sellers. A Netflix Partnership joins the connected TV offering from early 2027. Brazil cost per shipment was 5% lower in local currency, but net shipping margin fell about 200 basis points as a share of GMV since the first quarter of 2025.

Mercado Pago Credit Expands With a Card-Led Mix

Fintech Services reached 93 million monthly active users, up 29%. MercadoLibre (NASDAQ:MELI) said its credit portfolio grew 62% to almost USD 18 billion, with credit cards at 47% of the portfolio against 44%. Net interest margin after losses was 20.1%, one point lower, because new card cohorts carry upfront provisions before they mature. Acquiring volume grew 40% FX-neutral, and the merchant credit portfolio rose 15% quarter over quarter. In September the company raised USD 1 billion in its second investment grade bond issue. Credit quality, currency swings in Argentina and Brazil, and consumer weakness remain risks.

Where Things Stand

Net income rose because of a lower tax rate and smaller FX losses, not because operations improved. MercadoLibre (NASDAQ:MELI) grew revenue 45% yet earned a 6.3% Operating Margin as it deliberately spent on free shipping, fulfillment capacity and marketing, and management calls it a trade-off to build habits. The release gives no numeric guidance. Watch peak-season shipping costs, Mexico's growth, card cohort maturation and credit quality, and whether the operating margin recovers as management says scale and productivity should allow.