New York, Feb 25, 2026, 17:06 EST — After-hours
- MercadoLibre shares lost ground after hours, with investors still weighing a miss on quarterly profits.
- Logistics and credit investment are still squeezing margins, and that’s the main issue dogging the stock right now.
- Next up, traders are eyeing the company’s conference appearance, along with the upcoming earnings date, for more direction.
MercadoLibre, Inc. shares slumped 6.7% to $1,767.71 as of 4:15 p.m. ET Wednesday, deepening losses triggered after the company posted its quarterly results.
This is notable, since the debate dogging MercadoLibre’s stock hasn’t changed: just how much margin will the company surrender—how long will it sacrifice profit—to keep its main markets growing fast?
Revenue isn’t the issue here. Protecting the ecosystem—subsidies, marketing, credit—is driving costs, and those expenses are squeezing margins investors once saw as reliably moving in only one direction.
MercadoLibre turned in net income of $559 million for the fourth quarter, missing the $587 million analysts surveyed by LSEG had been looking for, even as revenue surged roughly 45% to $8.8 billion. Operating income (EBIT) climbed 8% to $889 million, but the margin slid to 10.1% from 13.5% last year—credit card investments, free shipping, and first-party (“1P”) retail costs ate into profitability. The company’s 15-to-90-day delinquency rate ticked up to 7.6%. “In soccer terms, we are still in minute 15 of the first half of the market development,” said Leandro Cuccioli, senior vice president of investor relations, underscoring how early the region is in online-commerce penetration. (Reuters)
MercadoLibre published its Q4 and full-year numbers on its investor relations site, according to a Form 8-K dated Feb. 24. The company attached the financial documents as an exhibit. (SEC)
Mercado Libre told shareholders it’s expanding free shipping in Brazil, dropping the minimum to R$19. Nearly 3 million credit cards went out during the quarter. Advertising revenue climbed 67% on an FX-neutral basis—currency moves excluded. The company also pointed to a $99 million lift from one-off tax credits in Brazil, which padded operating income. “The past year showed that Mercado Libre’s ecosystem is stronger than ever,” the shareholder letter read. (SEC)
Scott Devitt at Wedbush flagged upticks in ad spending, logistics costs, and credit provisions, all pressing down on margins. “We believe the expected level of spend will remain an overhang on shares,” Devitt wrote. (Investors)
MercadoLibre draws plenty of Amazon comparisons in Latin America, though its strategy puts just as much weight on Mercado Pago and lending. That combo can drive profits higher, yet it also means risk ramps up fast if management pushes loan growth hard.
Here’s the risk: Should loan performance deteriorate further, or if free-shipping subsidies remain higher for longer than investors are betting, the current margin pressure could start to look less like a passing headache and more like a permanent feature. If that’s how things play out, revenue beats by themselves probably won’t be enough to move the stock.
Investors are set to tune in for potential commentary on spending and profitability when management heads to the Morgan Stanley Conference in New York on March 24. After that, eyes turn to the company’s provisional first-quarter results, slated for May 7. (Mercadolibre)
