MercadoLibre Shares Face Profitability Test Amid Rapid Expansion

Latin America’s dominant e-commerce player, MercadoLibre, finds itself navigating complex challenges as its breakneck growth trajectory encounters profitability pressures. The company’s latest quarterly results present investors with a contradictory narrative of soaring revenues alongside shrinking margins, triggering market disappointment and raising questions about the sustainability of its business model.

MercadoLibre’s third-quarter 2025 financial disclosure highlighted a concerning divergence between top-line expansion and bottom-line performance. While net sales surged by an impressive 39.5% to reach $7.41 billion, exceeding market expectations, earnings per share of $8.32 fell substantially short of the projected $9.88. More alarmingly, the company’s net profit margin contracted to just 5.7%, indicating significant pressure on profitability. The direct contribution margin also witnessed Read more...