Business

Mercado Libre more than doubled e-commerce sales and payments volume in the 3rd quarter

The Argentina-based company's net revenue grew 85% in dollars reaching a record of $1.1 billion

Stelleo Tolda, President of MercadoLibre in Brazil. REUTERS/Nacho Doce
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  • The volume of payments in its financial arm Mercado Pago jumped 91.7% in dollars;
  • The company ended the quarter with a net profit of $15 million.

Online businesses quick scale up following the COVID-19 pandemic led MercadoLibre to new operating records in the third quarter, with the company accelerating investments in logistics to keep pace with year-end sales.

The e-commerce giant in Latin America reported on Wednesday that sales volume (GMV) reached $5.9 billion between July and September, an increase of 62.1% in dollars and 117.1% in constant currency, with total active single users rising 92.2% to 76 million.

READ ALSO: Mercado Pago reaches almost 20 million active users, and debuts in the insurance market

In addition, the volume of payments in its financial arm Mercado Pago jumped 91.7% in dollars and 161.2% in constant currency to $14.5 billion.

As a result, the net revenue of the company based in Argentina grew 85% in dollars and 148.5% in constant currency, reaching a record of $1.1 billion.

55%

of the total net revenue in the third quarter came from the operations in Brazil, reaching reached $610.7 million

The company ended the quarter with a net profit of $15 million, resulting in net income per share of $0.28, according to the balance sheet. Analysts, on average, expected Mercado Libre earnings of $10.5 million in the period, or $0.17 per share, according to data from Refinitiv.

READ ALSO: MercadoLibre launches MELI Air with 4 delivery planes fleet in Brazil

The balance sheet was released a few days after Brazilian rival B2W, owner of sites like Submarino and Americanas.com, reported a 56.2% rise in the quarter’s GMV over a year earlier, to BRL 7.26 billion.

The figures show how business through electronic channels gained traction in Brazil and Latin America even after governments eased social isolation measures taken since March to contain the pandemic, which left thousands of physical establishments closed for months.

“Good online shopping experiences are pleasing to consumers,” Stelleo Tolda, president of Mercado Libre for Latin America, he told Reuters.

According to the executive, the company expects to maintain the operational pace in this fourth quarter, given the commercial dates including Black Friday and Christmas. A better perception of the pace of electronic commerce in Brazil should appear at the beginning of 2021, said Tolda, when emergency aid programs must also end.

In any case, Mercado Libre plans to open new logistics centers in Brazil next year, while also workings to expand the base of sellers in its marketplace, including fashion, supermarket, and content production segments.

(Translated by LABS)

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