MercadoLibre Operating Income Falls as Shipping Costs Rise

The Tip Desk · November 11, 2026 · 4 min read

Net revenues and financial income were $10,750 million, up 45% year over year, while income from operations was $676 million, down 6%.

MercadoLibre, Inc. (MELI), Latin America’s leading e-commerce and fintech company, reported net revenues and financial income of $10,750 million for the third quarter ended September 30, 2026, up 45% from a year earlier and 41% on an FX-neutral basis. That USD growth rate slowed from 50% in the second quarter, when FX-neutral growth was 43%.

Income from operations was $676 million, with a 6.3% margin, 40 basis points below the 6.7% margin in the second quarter. The company said the sequential decline reflected a net shipping headwind of 60 basis points, split between gross margin (40 bps) and G&A (20 bps), and higher sales and marketing spend of 40 bps. Shipping compressed gross margin by 40 bps, with a 60 bps increase in shipping charges only partially offsetting a 100 bps increase in costs. Sales and marketing rose to 11.6% of net revenue after a tactical decision to invest more in the affiliates program in Brazil.

Net income was $448 million, with a 4.2% margin. The company said the decline in income from operations was more than offset by a lower tax rate and smaller FX losses of $72 million versus $102 million in the year-ago quarter.

Commerce revenue growth was stable at 41% on an FX-neutral basis (47% in USD), while Fintech decelerated to 40% FX-neutral (42% in USD). Currency movements were a tailwind to YoY growth of 50% in Brazil and 47% in Mexico and a headwind to Argentina’s 26% YoY growth; FX-neutral growth remained broadly stable in Brazil at 41% and in Mexico at 36%, while slowing to 42% in Argentina.

Gross merchandise volume was $23 billion, up 38% YoY and 33% FX-neutral. Total Payment Volume was $109 billion, up 53% YoY and 51% FX-neutral. Fintech Services reached 93 million monthly active users, up 29% YoY.

In Brazil, FX-neutral GMV grew 36% YoY and sold items grew 45%. Items per buyer grew 16% YoY after single-digit growth before the company lowered the free shipping threshold. Cost per shipment in Brazil was 5% lower YoY in local currency and 14% lower than in the first quarter of 2025. Net shipping margin fell by around 200 bps as a percentage of GMV since that quarter. In September, free and slow shipments in the R$19-79 range in Brazil were variable contribution-positive for the first time.

In Argentina, FX-neutral GMV grew 40% YoY and items sold 19%. In Mexico, FX-neutral GMV grew 21% YoY and items sold 25%, a slower pace than in recent quarters, with unique active buyer growth remaining broadly stable at 21%. Advertising revenue grew 51% YoY on an FX-neutral basis (58% in USD). The AI advisor now manages campaigns for 56,000 sellers, almost 4 times the number three months ago.

The credit portfolio reached almost $18 billion, up 62% YoY. NIMAL was 20.1%, 1 percentage point lower YoY, reflecting a mix shift toward the credit card, which now accounts for 47% of the portfolio, up from 44% a year ago. The 15-90 day NPL of 7.0% was broadly stable YoY and QoQ. Credit card NIMAL improved sequentially; in Brazil, maturation of existing cohorts helped offset dilution from new issuance even though issuance reached a record. Acquiring TPV grew 40% YoY on an FX-neutral basis, with growth of 31% in Brazil, 43% in Mexico, and 55% in Argentina.

The expansion of the shipping network added almost 20% to fulfillment square meters QoQ and 20 bps to G&A from associated recruitment costs. In cost of revenue, POS device restocking that weighed on the second quarter reversed, adding around 30 bps QoQ, fully offset by higher hosting costs related to AI and traffic growth. Investment in AI grew by almost $30 million QoQ.

Adjusted free cash flow was $285 million, even after $503 million of capex and $2.1 billion of investment in the expansion of the credit portfolio, partially offset by $1.5 billion of fintech funding. In September, the company concluded a second investment grade bond issue, raising $1 billion.