Yahoo Finance MercadoLibre's (MELI) Q1 Earnings Beat, Revenues Rise Y/Y
MercadoLibre, Inc. MELI reported first-quarter 2023 earnings of $3.97 per share, which surpassed the Zacks Consensus Estimate by 30.6%. Further, the figure reflects a significant jump from $1.30 in earnings per share reported in the year-ago quarter.
The company’s revenues jumped 35% on a year-over-year basis (58.4% on a FX-neutral basis) to $3.04 billion. The top line surpassed the Zacks Consensus Estimate of $2.88 billion.
The total revenues were driven by accelerating commerce and fintech revenues, which grew 31% and 40% year over year, respectively.
Increasing total payments volume (TPV), courtesy of the robust Mercado Pago, aided the company.
MercadoLibre’s rising gross merchandise volume (GMV) remained another positive. Strong shipment growth also contributed well to the reported results.
Additionally, solid momentum in Mercado Credito benefited the company. Further, increasing penetration of managed networks across the operating regions of the company was a tailwind.
MercadoLibre, Inc. Price, Consensus and EPS Surprise
MercadoLibre, Inc. price-consensus-eps-surprise-chart | MercadoLibre, Inc. Quote
Quarter in Detail
Brazil: Net revenues in the first quarter were $1.6 billion (52% of the total revenues), rising 26% year over year.
Argentina: The market generated revenues of $721 million (24% of the top line), which surged 39% year over year.
Mexico: Net revenues in the reported quarter were $591 million (19% of the total revenues), soaring 62% year over year.
Other countries: The markets generated revenues of $146 million (5% of the total revenues), increasing 28.1% on a year-over-year basis.
Key Metrics
GMV of $9.4 billion jumped 23.1% and 43.3% on a reported and an FX-neutral basis, respectively, from the year-ago quarter.
The number of successful items sold was 309 million, up 15.7% year over year. The number of successful items shipped rose 18.9% year over year to 302 million.
TPV increased 46.1% and 80% year over year on a reported and an FX-neutral basis, respectively, to $36.99 billion. This was driven by the strong performance of Mercado Pago. Off-Marketplace TPV was above $27 billion, up 121% year over year on a FX-neutral basis.
Acquiring TPV, which includes on-platform, online payments, MPoS and QR payments, was $24.3 billion, up 40% year over year.
Also, $12.7 billion of digital accounts’ TPV, including wallet payments, P2P transfers between Mercado Pago accounts and card transactions, surged 61% year over year.
TPV on the marketplace was $9.95 billion, up 23.3% year over year. Total payment transactions increased by 71.9% year over year to 1.9 billion.
Unique active users totaled 101 million, up 24.7% year over year.
Operating Details
For the first quarter, the gross margin was 50.6%, expanding 290 basis points (bps) year over year.
Operating expenses were $1.2 billion, which increased 28.1% year over year. As a percentage of revenues, the figure contracted 210 bps from the year-ago quarter to 39.4% in the reported quarter.
The company reported $340 million of income from operations in the reported quarter, which rose 144.6% from the year-ago quarter. The operating margin was 11.2%, expanding 500 bps from the prior-year quarter.
Balance Sheet
As of Mar 31, 2023, cash and cash equivalents were $2.14 billion, up from $1.91 billion on Dec 31, 2022.
Short-term investments were $2.5 billion for the first quarter, up from $2.3 billion in the previous quarter.
Accounts receivable amounted to $132 million, up from $130 million in the fourth quarter.
Zacks Rank & Stocks to Consider
Currently, MercadoLibre carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the retail-wholesale sector are The Kroger Co. KR, Ulta Beauty ULTA and Rush Enterprises RUSHA. All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Kroger has gained 9.2% on a year-to-date basis. The long-term earnings growth rate for KR is currently projected at 5.99%.
Ulta Beauty has gained 9.8% on a year-to-date basis. The long-term earnings growth rate for ULTA is currently projected at 12.26%.
Rush Enterprises has lost 3.1% on a year-to-date basis. The long-term earnings growth rate for RUSHA is currently projected at 15%.
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MercadoLibre, Inc. (MELI) : Free Stock Analysis Report
