MercadoLibre reported record quarterly revenue of $10.2bn as growth accelerated across its Latin American ecommerce and financial-services businesses. However, the company’s net profit declined for a third consecutive quarter as spending on free deliveries, logistics and credit-card expansion placed further pressure on margins.
Revenue growth exceeds expectations
Revenue and financial income increased by 50% during the second quarter of 2026, representing the company’s fastest growth rate in four years. The result exceeded analysts’ average forecast of approximately $9.7bn and marked the first time MercadoLibre generated more than $10bn during a single quarter.
Gross merchandise volume across its online marketplace rose by 36% when currency movements were excluded. Growth remained particularly strong in Brazil, Mexico and Argentina, MercadoLibre’s three most important markets.
Cross-border sales also expanded rapidly as the company connected Latin American consumers with more international merchants, including suppliers operating through its Chinese fulfilment network.
Profit falls despite forecast beat
Net income declined by 11% from the previous year to $466m. Although the result exceeded market expectations of approximately $433m, investors focused on the continuing deterioration in profitability.
Operating income fell by 17% to $683m, while the operating margin narrowed to 6.7% from 12.2% a year earlier. MercadoLibre shares dropped approximately 4.5% in after-hours trading, having initially fallen as much as 9%.
The reaction demonstrated that investors increasingly want evidence that rapid revenue growth can eventually translate into stronger and more consistent earnings.
Free shipping drives Brazilian activity
MercadoLibre has lowered the threshold for free deliveries in Brazil, encouraging customers to make more frequent purchases and place smaller orders. The number of items purchased by each Brazilian buyer increased by approximately 19%, while seller growth accelerated to 29%.
The strategy strengthens customer loyalty and makes the marketplace more difficult for competitors to challenge. However, the company must absorb higher delivery and logistics expenses before greater order volumes generate sufficient efficiency benefits.
Brazil accounts for more than half of MercadoLibre’s revenue. The company plans to invest nearly $11bn in the country during 2026, including spending on technology, financial services and 14 additional fulfilment centres.
Mercado Pago expands lending
MercadoLibre’s financial division continued growing alongside the marketplace. Its credit portfolio reached approximately $16.4bn, representing an increase of 75% from the previous year.
The company is issuing more credit cards, particularly in Brazil, where 2.6m cards were distributed during the quarter compared with 1.6m a year earlier. Payment volume processed through its merchant-acquiring business increased by 42%.
Customers using both MercadoLibre’s marketplace and Mercado Pago grew by 37%. These combined users typically purchase more products, process more payments and maintain larger account balances than customers using only one part of the platform.
Credit expansion creates additional risk
The larger lending portfolio gives MercadoLibre access to interest income and strengthens customer relationships, but it also increases exposure to defaults and economic weakness. Credit cards normally require an initial investment period before becoming profitable, contributing to the current pressure on margins.
Management argues that expanding the card business now will create a more valuable financial platform over time. The company is therefore prioritising market share and long-term customer engagement over the preservation of short-term profit margins.
Growth strategy faces investor test
MercadoLibre remains one of Latin America’s most successful technology companies, benefiting from relatively low ecommerce penetration and limited access to traditional banking across the region.
Its latest results confirm that demand remains strong. The central question is whether its vast investments in logistics, free shipping and consumer credit will produce sufficiently high returns to satisfy shareholders once the current expansion phase begins to mature.
Newshub Editorial in South America – 6 August 2026
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