Latin American e-commerce and fintech company MercadoLibre (NASDAQ: MELI) reported Q3 CY2025 results beating Wall Street’s revenue expectations, with sales up 39.5% year on year to $7.41 billion. Its GAAP profit of $8.32 per share was 10.5% below analysts’ consensus estimates.
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MercadoLibre (MELI) Q3 CY2025 Highlights:
- Revenue: $7.41 billion vs analyst estimates of $7.20 billion (39.5% year-on-year growth, 2.9% beat)
- EPS (GAAP): $8.32 vs analyst expectations of $9.30 (10.5% miss)
- Adjusted EBITDA: $933 million vs analyst estimates of $964.1 million (12.6% margin, 3.2% miss)
- Operating Margin: 9.8%, in line with the same quarter last year
- Free Cash Flow Margin: 59.6%, up from 38.7% in the previous quarter
- Unique Active Buyers: 77 million, up 16.2 million year on year
- Market Capitalization: $116.4 billion
Company Overview
Originally started as an online auction platform, MercadoLibre (NASDAQ: MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last three years, MercadoLibre grew its sales at an incredible 39.4% compounded annual growth rate. Its growth surpassed the average consumer internet company and shows its offerings resonate with customers, a great starting point for our analysis.
This quarter, MercadoLibre reported wonderful year-on-year revenue growth of 39.5%, and its $7.41 billion of revenue exceeded Wall Street’s estimates by 2.9%.
Looking ahead, sell-side analysts expect revenue to grow 28.3% over the next 12 months, a deceleration versus the last three years. Still, this projection is eye-popping given its scale and indicates the market is forecasting success for its products and services.
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Unique Active Buyers
User Growth
As an online marketplace, MercadoLibre generates revenue growth by increasing both the number of users on its platform and the average order size in dollars.
Over the last two years, MercadoLibre’s unique active buyers, a key performance metric for the company, increased by 21.8% annually to 77 million in the latest quarter. This growth rate is among the fastest of any consumer internet business and indicates its offerings have significant traction. 
In Q3, MercadoLibre added 16.2 million unique active buyers, leading to 26.6% year-on-year growth. The quarterly print was higher than its two-year result, suggesting its new initiatives are accelerating user growth.
Revenue Per User
Average revenue per user (ARPU) is a critical metric to track because it measures how much the company earns in transaction fees from each user. ARPU also gives us unique insights into a user’s average order size and MercadoLibre’s take rate, or "cut", on each order.
MercadoLibre’s ARPU growth has been exceptional over the last two years, averaging 13.8%. Its ability to increase monetization while growing its unique active buyers at an impressive rate reflects the strength of its platform, as its users are spending significantly more than last year. 
This quarter, MercadoLibre’s ARPU clocked in at $96.22. It grew by 10.1% year on year, slower than its user growth.
Key Takeaways from MercadoLibre’s Q3 Results
We enjoyed seeing MercadoLibre increase its number of users this quarter. We were also happy its number of unique active buyers outperformed Wall Street’s estimates, leading to a consolidated revenue beat. On the other hand, its EPS missed due to "strategic investments that increased cost of revenue, sales & marketing and provisions for doubtful accounts as a percentage of revenue. These include lowering our free shipping threshold in Brazil, ramping-up 1P, investing in social commerce and expanding our credits business." Zooming out, we think this was a mixed quarter. Investors were likely hoping for more, and shares traded down 3.4% to $2,226 immediately following the results.
Should you buy the stock or not? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.
