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MercadoLibre (MELI) reported significant growth in the first quarter of 2025, achieving $3.3 billion in commerce revenues, an increase of 32.3% year over year, and holding less than 5% of the region’s retail market. Unique active buyers grew by 25%, while foreign exchange-neutral Gross Merchandise Volume (GMV) climbed 30% in Brazil, 23% in Mexico, and 126% in Argentina.
The company is investing in user experience and logistics, with enhancements leading to a 65% growth in the supermarket category year over year. Fulfillment penetration in Brazil exceeded 60% by March, enabling initiatives like free shipping to enhance customer satisfaction. The Zacks Consensus Estimate projects second-quarter commerce revenues at $3.7 billion.
Despite the growth, MercadoLibre faces heightened competition from Amazon and Alibaba in Latin America, which could impact its pricing power and customer retention. Year-to-date, MELI shares have increased by 43%, outperforming sector growth, with a forward Price/Sales ratio of 3.96 compared to the industry average of 2.01.
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