70624188bee9112ec2500de45b97f9d32dbb87450b85d8536b67907216554592

2181a144d47e74673bb99091207092a309db1a8ad2471fc1bd28d43d4a9289dc

Fintech monthly active users (millions)

Unique active buyers (millions)

Gross merchandise volume (USD millions)

Number of items sold (millions of items)

Number of items shipped (millions of items)

Total payment volume (USD millions)

Acquiring total payments volume (USD millions)

Total payment transactions (millions of transactions)

NIMAL (percentage)

e59de8019cfea91acf4aa6494e73571ea2d8e8c2e12f6afc45f98b80bfe64d78

Brazil

Argentina

Mexico

Other Countries

Venezuela

Total Revenue

74e4954ef2f454b3db5417945130fe7befcf3e8f2ce9dcc81481e7b2482d37c0

72888f65a7cecc3671669a8a8a0ba1186f3acbf5fee5013a8bc33f6a06a190c2

8247a103bda5cf0f71c1fb7c1bc96ead3fd332b161918064bd4c5de7759e605d

Net Revenues and Financial Income (USD, millions)

Cost of Net Revenues and Financial Expenses (USD, millions)

Gross Profit (USD, millions)

Total Operating Expenses (USD, millions)

Income from Operations (USD, millions)

Interest Income and Other Financial Gains (USD, millions)

Interest Expense and Other Financial Losses (USD, millions)

Foreign Currency Losses, Net (USD, millions)

Net Income before Income Tax Expense and Equity in Earnings (USD, millions)

Income Tax Expense (USD, millions)

Net Income (USD, millions)

f93d37feb1fa1dd3b1068469e582b1def8a88802dd5a1274dc9bf5f7669ac838

MercadoLibre’s **Q4 2023 Net Income** decline was driven by several factors. First, the company incurred **one-off expenses**—notably **$350 million** in incremental withholding tax provisions (with **6%** of that charge affecting Q4), which heavily impacted earnings.  **[0001099590-24-000008_meli-20231231.htm:215]** **[MELI_3374838_6]**  Additionally, **foreign exchange losses** totaling **$107 million**—stemming from the repatriation of funds in Argentina and the revaluation of assets and liabilities due to currency devaluation—further reduced net income.  **[0001099590-24-000008_meli-20231231.htm:215]** **[0001099590-24-000005_meli-20240222xex991.htm:6]**  Elevated **shipping costs** and a surge in free shipping initiatives, particularly linked to the rollout of the Meli+ loyalty program in Brazil and Mexico, combined with a lower contribution from shipping revenue, added further pressure on margins. Finally, while the growth in the first-party (1P) business (reflected in a 50% quarter-over-quarter GMV increase) was robust, its inherently lower margins also contributed to the compression of overall net income.  **[0001099590-24-000008_meli-20231231.htm:215]** **[0001099590-24-000005_meli-20240222xex991.htm:6]** **[MELI_3374838_4]** 

Why did Net Income drop so significantly in Q4 2023?

The sharp increase in Net Income in Q1 2024 was primarily driven by **strong revenue growth** (with a 36% year-over-year increase in total net revenues, fueled by robust performance in both the Commerce and Fintech segments  **[0001099590-24-000015_meli-20240502xex991.htm:1]** **[0001099590-24-000017_meli-20240331.htm:50]** ), **improved operating income** (boosted by higher gross profit margins and operational efficiencies  **[0001099590-24-000015_meli-20240502xex991.htm:12]** **[0001099590-24-000017_meli-20240331.htm:3]** ), effective **cost management** (where revenue growth outpaced the rise in operating expenses  **[0001099590-24-000015_meli-20240502xex991.htm:12]** **[0001099590-24-000017_meli-20240331.htm:3]** ), and **reduced foreign currency losses** (which dropped significantly from Q1 2023 to Q1 2024  **[0001099590-24-000015_meli-20240502xex991.htm:12]** ). Additionally, the **Fintech segment** experienced notable growth in total payment volume and credit revenues  **[0001099590-24-000015_meli-20240502xex991.htm:1]** **[0001099590-24-000017_meli-20240331.htm:50]** , along with increased **tax efficiency** that helped further enhance net income.  **[0001099590-24-000015_meli-20240502xex991.htm:12]** 

What factors contributed to the sharp increase in Net Income in Q1 2024?

The substantial rise in **Net Product Revenues** in Q4 2023 was driven by several key factors. **Accelerated first-party sales**, particularly in Brazil, helped boost revenues as the company invested in expanding its product assortment and enhancing the buyer experience (81% sales growth in 2023).  **[MELI_3374838_1]**  Additionally, an **improved logistics network** achieved a record fulfillment penetration of almost **50%**, which enhanced the user experience by enabling faster and more reliable shipping during the peak holiday season.  **[MELI_3374838_1]**  **Category-specific innovations** further strengthened the value proposition across various segments, contributing to higher product sales.  **[0001099590-24-000005_meli-20240222xex991.htm:0]**  Lastly, the **Commerce segment** experienced **48% year-over-year growth** in Q4 2023, driven by strong execution during the peak season and ongoing investments throughout the year.  **[0001099590-24-000005_meli-20240222xex991.htm:5]** 

What drove the substantial rise in Net Product Revenues in Q4 2023?

In Q1 2024, the **$25 million** figure for Interest Income and Other Financial Gains was lower largely because of a **strategic reclassification of certain financial results**. Specifically, MercadoLibre began including interest income from investments related to its Mercado Pago operations in different reporting categories, which, combined with regulatory requirements for maintaining liquidity reserves, resulted in a lower reported number for this line item.  **[0001099590-24-000017_meli-20240331.htm:8]** 

Why were Interest Income and Other Financial Gains so low in Q1 2024?

The spike in **Product and Technology Development Expenses** in **Q4 2023** was primarily caused by several key factors. These include a **one-off charge of $261 million** related to tax contingencies in Brazil due to a potential legal loss on withholding income tax issues  **[0001099590-24-000005_meli-20240222xex991.htm:5]** , a **13% headcount increase** driving higher salaries, wages, and additional accruals under long-term retention programs owing to an increase in MercadoLibre's stock price  **[0001099590-24-000008_meli-20231231.htm:93]** , and a **$49 million increase** in depreciation and amortization expenses related to capitalized information and technology assets.  **[0001099590-24-000008_meli-20231231.htm:93]** 

What caused the spike in Product and Technology Development Expenses in Q4 2023?

5c20ce2e0cfa59987c45bfe0af53c4225a22a59177c384bdcc49dc3fe3c8731b

The noticeable spike in cash and cash equivalents in Q2 2024 was driven primarily by a substantial increase in **net cash provided by operating activities**, which generated **$3,394 million** during the first six months of 2024. This strong operating performance, combined with adjustments from financing activities—despite significant cash used in investing activities and the impact of exchange rate fluctuations and regulatory cash requirements—resulted in the overall marked increase in cash reserves.  **[0001099590-24-000023_meli-20240801xex991.htm:16]** **[0001099590-24-000023_meli-20240801xex991.htm:11]** 

What drove the noticeable spike in cash and cash equivalents in Q2 2024?

The significant jump in total assets in Q3 2024 was primarily driven by **substantial increases in both current and non-current assets**. For current assets, key contributors included higher **short-term investments**, **credit card receivables and other means of payments**, **loans receivable**, **inventories**, and **customer crypto-assets safeguarding assets**. On the non-current side, the rise in **long-term investments**, additional growth in **loans receivable** and **property and equipment**, along with improvements in **operating lease right-of-use assets**, **deferred tax assets**, and other less prominent asset categories, all contributed to the overall increase. This combined effect resulted in total assets rising significantly to **$22,623 million** in Q3 2024.  **[0001099590-24-000042_meli-20240930.htm:2]** **[0001099590-24-000039_meli-20241106xex991.htm:10]** 

Why did total assets jump significantly in Q3 2024?

The sharp rise is primarily explained by a significant **increase in non-current loans payable and other financial liabilities**—rising by **$900 million** compared to the prior reporting period—offsetting a minor decline in current liabilities, in part due to activities such as **securitization of credit card receivables and loans via Special Purpose Entities** in key markets, additional financing raised for **fintech and commerce activities**, and possible reclassification of liabilities from current to non-current. These factors collectively drove the overall increase in liabilities for Q3 2024.  **[0001099590-24-000042_meli-20240930.htm:41]** **[0001099590-24-000042_meli-20240930.htm:95]** **[0001099590-24-000042_meli-20240930.htm:48]** **[0001099590-24-000042_meli-20240930.htm:84]** **[0001099590-24-000042_meli-20240930.htm:87]** 

What explains the sharp rise in loans payable and other financial liabilities in Q3 2024?

The documents note that there was a significant increase in long-term investments from **$162 million** as of December 31, 2023, to **$1,226 million** as of September 30, 2024, but they do not provide specific reasons or factors underlying this surge.  **[0001099590-24-000042_meli-20240930.htm:2]** 

What factors contributed to the surge in long-term investments in Q3 2024?

b1fac372bc17d843d8ea73aca5bbfff82fb051f5bb663ecd585008493b98d149

In Q4 2023, operating cash flow nearly doubled because of a **significant increase in net income** (rising by **$505 million**) and **large adjustments for non-cash items** (**$2,103 million**), along with favorable changes in working capital. Increases in **payables and accrued expenses** (**$1,225 million**), **funds payable to customers** (**$1,502 million**), and **amounts payable for credit and debit card transactions** (**$693 million**) more than offset a **$1,321 million** increase in credit card receivables and other payment items, which contributed to a **74.8% increase** in operating cash flow compared to the previous period.  **[0001099590-24-000008_meli-20231231.htm:107]** 

Why did operating cash flow nearly double in Q4 2023?

The surge in operating cash flow in FY 2023 was driven by several key factors. **Net income increased by $505 million** (from **$482 million to $987 million**), which played a major role. Additionally, there were notable increases in **payables and accrued expenses (up by $776 million)**, **funds payable to customers (up by $458 million)**, and **amounts payable due to credit and debit card transactions (up by $565 million)**. Although these gains were partially offset by a **$1,321 million** increase in credit card receivables, the combined effect led to a **74.8%** boost in net cash provided by operating activities.  **[0001099590-24-000008_meli-20231231.htm:107]** **[0001099590-24-000008_meli-20231231.htm:150]** 

What drove the surge in operating cash flow in FY 2023?

MercadoLibre’s net income dropped significantly in Q4 2023 because the quarter was heavily impacted by **one-off expenses**, notable **foreign exchange losses**, and **increased seasonal cost pressures**. Specifically, the company incurred one-off tax-related expenses (with only 6% of a $350 million charge occurring in Q4), suffered FX losses totaling **$107 million**—driven by both fund repatriation in Argentina and asset revaluation in Argentine pesos—and saw its margins compressed from higher logistics, shipping, and free shipping costs, as well as a revenue mix shift toward lower-margin first-party sales.  **[0001099590-24-000008_meli-20231231.htm:215]** **[0001099590-24-000005_meli-20240222xex991.htm:6]** **[MELI_3374838_6]** **[MELI_3374838_4]** 

Why did net income drop significantly in Q4 2023?

During Q3 2024, the increase in capex was driven by a strategic focus on bolstering technology and logistics. **MercadoLibre** invested **$237 million** in information and technology assets across Brazil, Mexico, and Argentina, and allocated **$269 million** to shipping premises and offices in these regions. Additionally, the expansion of fulfillment centers significantly contributed to the overall rise in investments in property and equipment.  **[0001099590-24-000042_meli-20240930.htm:91]** 

What led to the increase in capex in Q3 2024?

e9187daaa481e0d4fbf55d8559f81b571aca336759aedbf7b8e3f56748c759fb

a6f0559309b892f2379a81e65f6615e1a500751d2ca435472734ed654ed7f01a

Commerce

- Commerce Services

- Commerce Product Sales

Fintech

- Fintech Services

- Credit Revenues

- Fintech Product Sales

- Payment Fees

Non-Marketplace

Net Service Revenues and Financial Income

Net Product Revenues

a9fd07f44af97138e3fb29e93c0b55f40daf8f3de64e30fb3a5d995a5115097f

MercadoLibre Inc (MELI)

Financials