Will MercadoLibre’s (MELI) Fintech Bet Sustain Margins or Stretch Growth Risks After Latest Results?

• MercadoLibre reported third-quarter 2025 results, revealing revenue of US$7.41 billion and net income of US$421 million, both higher than the same period last year, but with earnings per share missing analyst expectations due to increased investments in shipping, marketing, and credit provisions.
• The company’s fintech segment, including Mercado Pago, saw significant growth, supported by expanded credit offerings and user adoption, while ongoing investments impacted short-term margins.
• We’ll explore how MercadoLibre’s focus on fintech expansion and user growth influences its long-term investment narrative following the latest earnings announcement.

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MercadoLibre Investment Narrative Recap

To be a MercadoLibre shareholder, I believe in the power of e-commerce and fintech to transform Latin America, with user and payment ecosystem growth driving potential long-term value. The Q3 2025 results reinforce MercadoLibre's user growth and revenue momentum, though EPS missed due to higher spending on shipping, marketing, and credit, underscoring that the biggest short-term catalyst remains fintech user growth, and the risk of rising credit losses is still front of mind. The recent results confirm these themes without materially shifting near-term risks or opportunities.

The most relevant recent announcement is MercadoLibre’s Q3 earnings report, which showed revenue up 39% year-over-year, outpacing forecasts and fueled by a surge in unique active buyers and strong adoption of Mercado Pago’s services. This growth supports the key catalyst of accelerating fintech and payments adoption, but also highlights the company’s increased exposure to credit risk and the challenges of maintaining margins as credit and logistics investments scale.

However, investors should be aware that rapid growth in the credit portfolio, while fueling revenue, exposes MercadoLibre to unexpected spikes in delinquency and ...

Read the full narrative on MercadoLibre (it's free!)

MercadoLibre's narrative projects $46.9 billion revenue and $5.1 billion earnings by 2028. This requires 24.8% yearly revenue growth and a $3.0 billion increase in earnings from $2.1 billion today.

Uncover how MercadoLibre's forecasts yield a $2894 fair value, a 26% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members submitted 27 fair value estimates for MercadoLibre shares ranging from US$2,315 to US$3,406. With fintech expansion boosting revenue but also expanding credit risk, the community’s wide range of outlooks signals just how many ways you can interpret MercadoLibre’s performance and prospects.

Explore 27 other fair value estimates on MercadoLibre - why the stock might be worth just $2316!

Build Your Own MercadoLibre Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your MercadoLibre research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.
• Our free MercadoLibre research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate MercadoLibre's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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