MercadoLibre Reports Record Profit, Continues to Scale its Fintech Businesses #
MercadoLibre (NASDAQ: $MELI ), the LatAm e-commerce and fintech giant, reported its Q4 2022 results on Thursday smashing analysts' estimates. In Q4 2022, Gross Merchandise Volume grew 20% YoY to $9.6 billion, driving a 22% YoY increase in Commerce revenue to $1.66 billion. Total Payment Volume grew 49% YoY to $36.0 billion and Credit Portfolio grew 68% YoY to $2.84 billion, driving a 73% YoY increase in Fintech revenue to $1.34 billion. The company posted a Net Income of $165 million on consolidated net revenue of $3.0 billion (compared to a Net Loss of $46.1 million on consolidated net revenue of $2.1 billion in Q4 2021).
While not a “pure” Fintech company, MercadoLibre’s Fintech arm, MercadoPago, is definitely a force to reckon with in Latin America. In Q4 2022, the company reported 43.7 million unique “fintech active users” (of which 23.3 million used the company’s digital wallet), processed $25.8 billion in payment volume outside of MercadoLibre’s marketplace, as well as continued scaling its consumer, credit card and merchant lending, and insurance brokerage businesses. Given the growth pace of the company’s many Fintech businesses, I would expect the fintech revenue to overtake the commerce revenue in 2023 or 2024 at the latest (see the chart below).
