"Q1 2026, reported May 7, 2026, delivered revenue of $8.85 billion, up 49.03% YoY and topping consensus expectations. EPS of $8.23 beat the $8.20 estimate. The catch: operating income fell 19.92% to $611 million, and operating margin compressed 600 basis points to 6.9% as MELI leaned into credit cards, 1P commerce, and logistics."
"The bull case rests on Brazil and fintech. Brazil revenue grew 55% YoY, items sold jumped 56%, and unique buyers rose 32%, the fastest pace in five years. Mexico ran 62%. The credit card portfolio more than doubled to $6.6 billion with 2.7 million cards issued in the quarter. Advertising revenue climbed 73% and AUM hit nearly $20 billion."
"The structural runway is real. Latin Americans average 7 online purchases per year vs. 41 in the US. Bullish analysts back the move. The Wall Street consensus target sits at $2,439.88 with 24 buy ratings against 2 holds and zero sells. Our bull-case scenario points to $2,853.41, a 52.59% 12-month return, if margins inflect sooner than guided."
"The risks worth watching: Margin compression is the loudest concern. NIMAL fell 4.9 percentage points to 17.8%, provisions for doubtful accounts surged to $1.244 billion from $603 million, and adjusted free cash flow turned negative at -$56 million. Net debt expanded to $5.7"
Revenue rose sharply to $8.85 billion, up 49.03% year over year, and EPS reached $8.23, beating expectations. Operating income declined to $611 million and operating margin compressed by 600 basis points to 6.9% as credit cards, 1P commerce, and logistics were emphasized. Brazil revenue grew 55% year over year, items sold increased 56%, and unique buyers rose 32%, with Mexico revenue up 62%. The credit card portfolio more than doubled to $6.6 billion with 2.7 million cards issued. Advertising revenue increased 73% and AUM neared $20 billion. Risks include margin compression, higher doubtful account provisions, negative adjusted free cash flow, and rising net debt.
Read at 24/7 Wall St.
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