MercadoLibre Shares Surge to Record High on Strong Earnings

MercadoLibre (NASDAQ: MELI) shares surged to an all-time high on Thursday, February 20, 2025, following the company's strong fourth-quarter earnings report. The e-commerce and fintech giant reported net revenue of $6.1 billion, up 37% year-over-year, and net income of $639 million, a 10.5% margin. The company's stock price climbed more than 13% in the after-hours session, reflecting investors' enthusiasm for the results.

MercadoLibre's commerce operations thrived in the fourth quarter, with unique buyers surpassing 67 million, a 24% increase year-over-year. Gross merchandise value (GMV) rose 8% year-over-year to reach $14.5 billion, while items sold on the platform increased by 27%. The company's fintech services also performed well, with Mercado Pago's monthly active users climbing 34% to reach 61 million, and assets under management soaring 129% to $10.6 billion.



The company's strong earnings performance was driven by several key factors:

1. Growth in E-commerce and Fintech Revenue: MercadoLibre's e-commerce revenue climbed 44% year-over-year, while fintech revenue grew by 29%. This growth was fueled by the company's expanding user base and increasing engagement on its platform.
2. Improved Margins: MercadoLibre's operating profit margin was 14.3% in Q2 2024, up from 12.5% in Q2 2023. The company's net income margin was 10.5% in Q4 2024, reflecting robust profitability.
3. Expansion of Fintech Services: Mercado Pago, MercadoLibre's digital payment platform, witnessed a 29% year-over-year increase in monthly active users, reaching 61.2 million in Q4 2024. The total credit portfolio expanded to $6.6 billion, a 74% increase year-over-year, indicating successful scaling in key financial services.
4. Investments in Logistics and Infrastructure: MercadoLibre opened 10 new fulfillment centers and expanded its free shipping offering, resulting in a record-breaking number of new buyers. The company's delivery and fulfillment service, Mercado Envios, processed over 1.79 billion items in 2024, with a 27% year-over-year increase in the fourth quarter.

MercadoLibre's strong earnings performance reflects the company's strategic focus on e-commerce, logistics, and fintech services. By investing in growth, expanding its user base, and improving its offerings, MercadoLibre has been able to drive growth and maintain its dominant position in Latin America's e-commerce landscape. As the company continues to innovate and adapt to the unique needs of the region, investors can expect MercadoLibre to remain a strong performer in the coming quarters.