MercadoLibre, Inc. (MELI) reported significant growth in its Brazilian market due to a strategic reduction in its free-shipping threshold initiated in June 2025. In Q2 2026, items sold in Brazil surged by 56% year-over-year, compared to 26% growth in the previous year, while foreign exchange neutral gross merchandise volume (GMV) increased by 39%. The company also added nearly 19 million unique active buyers globally.
The lowered threshold led to a 1.1 percentage point increase in conversion rates year-over-year and a 19% rise in items sold per unique active buyer in Brazil. Additionally, the percentage of Brazilian buyers purchasing across three or more categories monthly grew by 10 percentage points, indicating a shift towards broader shopping behaviors.
Despite facing higher shipping costs, MercadoLibre’s operational model now considers free shipments financially viable across various price ranges, suggesting a sustainable positive impact from the free-shipping policy. The company’s forward 12-month price-to-earnings (P/E) ratio stands at 39.02, above the industry average of 22.13.
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