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MercadoLibre, Inc. (MELI - Free Report) reported fourth-quarter 2022 earnings of $3.25 per share, which surpassed the Zacks Consensus Estimate by 54%. Further, the figure compares favorably with the loss of 92 cents per share reported in the year-ago quarter.
The company’s revenues jumped 41% on a year-over-year basis (56.5% on a FX-neutral basis) to $3.002 billion. The top line surpassed the Zacks Consensus Estimate of $2.95 billion.
The total revenues were driven by accelerating commerce and fintech revenues, which grew 22% and 73% year over year to $1.7 billion and $1.3 billion, 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 on MercadoEnvios and the growing penetration of managed networks in the reported quarter were tailwinds.
Strengthening momentum across Mercado Fondo and Mercado Credito also benefited the company.
MercadoLibre, Inc. Price, Consensus and EPS Surprise
Brazil: Net revenues in the fourth quarter were $1.53 billion (51% of the total revenues), rising 36% year over year.
Argentina: The market generated revenues of $713 million (24% of the top line), which surged 50% year over year.
Mexico: Net revenues in the reported quarter were $607 million (20% of the total revenues), soaring 55% year over year.
Other countries: The markets generated revenues of $150 million (5% of the total revenues), increasing 10.3% on a year-over-year basis.
Key Metrics
GMV of $9.6 billion jumped 20.8% and 35% on a reported and a FX-neutral basis, respectively, from the year-ago quarter.
The number of successful items sold was 321 million, up 11.45% year over year. The number of successful items shipped rose 12.7% year over year to 311 million. This can be attributed to the sturdy performance of MercadoEnvios.
TPV increased 48.3% and 80% year over year on a reported and a FX-neutral basis, respectively, to $35.95 billion. This was driven by the strong performance of Mercado Pago. Off-Marketplace TVP was above $25 billion, up 121% year over year on a FX-neutral basis.
Acquiring TPV, which includes on-platform, online payments, MPoS and QR payments, was $24.5 billion, up 42.4% year over year.
Also, $11.5 billion of digital accounts’ TPV, including wallet payments, P2P transfers between Mercado Pago accounts and card transactions, surged 62% year over year.
TPV on the marketplace was $10.1 billion, up 23.4% year over year. Total payment transactions increased by 63% year over year to 1.7 billion.
Unique active users totaled 97 million, up 18.3% year over year.
Operating Details
For the fourth quarter, the gross margin was 48.6%, expanding 860 basis points (bps) year over year.
Operating expenses were $1.1 billion, which increased 33.8% year over year. As a percentage of revenues, the figure contracted 200 bps from the year-ago quarter to 36.9% in the reported quarter.
The company reported $349 million of income from operations in the reported quarter, which rose from $24 million reported in the year-ago quarter. The operating margin was 11.6%, expanding 880 bps from the prior-year quarter.
Balance Sheet
As of Dec 31, 2022, cash and cash equivalents were $1.91 billion, up from $1.46 billion on Sep 30, 2022.
Short-term investments were $2.34 billion for the fourth quarter, up from $1.94 billion in the previous quarter.
Accounts receivable amounted to $130 million, up from $108 million in the third quarter.
Zacks Rank & Stocks to Consider
Currently, MercadoLibre sports a Zacks Rank #1 (Strong Buy).
Image: Bigstock
MercadoLibre's (MELI) Q4 Earnings Beat, Revenues Rise Y/Y
MercadoLibre, Inc. (MELI - Free Report) reported fourth-quarter 2022 earnings of $3.25 per share, which surpassed the Zacks Consensus Estimate by 54%. Further, the figure compares favorably with the loss of 92 cents per share reported in the year-ago quarter.
The company’s revenues jumped 41% on a year-over-year basis (56.5% on a FX-neutral basis) to $3.002 billion. The top line surpassed the Zacks Consensus Estimate of $2.95 billion.
The total revenues were driven by accelerating commerce and fintech revenues, which grew 22% and 73% year over year to $1.7 billion and $1.3 billion, 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 on MercadoEnvios and the growing penetration of managed networks in the reported quarter were tailwinds.
Strengthening momentum across Mercado Fondo and Mercado Credito also benefited the company.
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 fourth quarter were $1.53 billion (51% of the total revenues), rising 36% year over year.
Argentina: The market generated revenues of $713 million (24% of the top line), which surged 50% year over year.
Mexico: Net revenues in the reported quarter were $607 million (20% of the total revenues), soaring 55% year over year.
Other countries: The markets generated revenues of $150 million (5% of the total revenues), increasing 10.3% on a year-over-year basis.
Key Metrics
GMV of $9.6 billion jumped 20.8% and 35% on a reported and a FX-neutral basis, respectively, from the year-ago quarter.
The number of successful items sold was 321 million, up 11.45% year over year. The number of successful items shipped rose 12.7% year over year to 311 million. This can be attributed to the sturdy performance of MercadoEnvios.
TPV increased 48.3% and 80% year over year on a reported and a FX-neutral basis, respectively, to $35.95 billion. This was driven by the strong performance of Mercado Pago. Off-Marketplace TVP was above $25 billion, up 121% year over year on a FX-neutral basis.
Acquiring TPV, which includes on-platform, online payments, MPoS and QR payments, was $24.5 billion, up 42.4% year over year.
Also, $11.5 billion of digital accounts’ TPV, including wallet payments, P2P transfers between Mercado Pago accounts and card transactions, surged 62% year over year.
TPV on the marketplace was $10.1 billion, up 23.4% year over year. Total payment transactions increased by 63% year over year to 1.7 billion.
Unique active users totaled 97 million, up 18.3% year over year.
Operating Details
For the fourth quarter, the gross margin was 48.6%, expanding 860 basis points (bps) year over year.
Operating expenses were $1.1 billion, which increased 33.8% year over year. As a percentage of revenues, the figure contracted 200 bps from the year-ago quarter to 36.9% in the reported quarter.
The company reported $349 million of income from operations in the reported quarter, which rose from $24 million reported in the year-ago quarter. The operating margin was 11.6%, expanding 880 bps from the prior-year quarter.
Balance Sheet
As of Dec 31, 2022, cash and cash equivalents were $1.91 billion, up from $1.46 billion on Sep 30, 2022.
Short-term investments were $2.34 billion for the fourth quarter, up from $1.94 billion in the previous quarter.
Accounts receivable amounted to $130 million, up from $108 million in the third quarter.
Zacks Rank & Stocks to Consider
Currently, MercadoLibre sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the retail-wholesale sector are Ulta Beauty (ULTA - Free Report) , Costco Wholesale (COST - Free Report) and Ross Stores (ROST - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ulta Beauty has gained 42.4% on a year-to-date basis. The long-term earnings growth rate for ULTA is currently projected at 13.75%.
Costco Wholesale has lost 1.6% on a year-to-date basis. The long-term earnings growth rate for COST is currently projected at 9.57%.
Ross Stores has gained 24.3% on a year-to-date basis. The long-term earnings growth rate for ROST is currently projected at 10.5%.