MercadoLibre, Inc.’s MELI Brazil business remained a standout in the second quarter of 2026, with marketplace growth holding at a high level, even as the company began lapping last year’s reduction in its free-shipping threshold. Gross merchandise volume in Brazil increased 39% year over year on an FX-neutral basis, slightly ahead of the 38% growth recorded in the first quarter of 2026 and substantially ahead of the 29% growth registered in the second quarter last year. Items sold jumped 56% compared with 26% growth a year earlier.
The strength goes beyond transaction volume. Items sold per unique active buyer in Brazil rose 19% year over year, while conversion improved 1.1 percentage points. Daily active users have also continued to grow faster than monthly active users in every quarter since MercadoLibre lowered its free-shipping threshold in June 2025. At the same time, the share of users purchasing three or more categories per month has increased by 10 percentage points since the change.
Newer buyer cohorts are also purchasing more items across more categories and showing higher retention than earlier cohorts. Ecosystemic user growth in Brazil accelerated to almost 50% year over year in the quarter, up from 35% before the shipping-threshold change.
MercadoLibre is supporting this momentum with PIX discounts for buyers and lower take rates for sellers in selected categories and price ranges. Active sellers grew 29% year over year, helping improve selection and price competitiveness. Together, the trends show that Brazil’s growth continues to be supported by stronger engagement, broader supply and sustained marketplace activity.
How Does MercadoLibre Stack Up Against Its Industry?
MercadoLibre, which competes with Amazon.com, Inc. AMZN and Sea Limited SE, has seen its shares gain 15.5% over the past three months against the industry’s 0.6% decline. While Amazon shares have fallen 2.9%, Sea Limited has rallied 34.7% in the aforementioned period.
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What Does MercadoLibre’s Current Valuation Suggest?
From a valuation standpoint, MercadoLibre’s forward 12-month price-to-earnings (P/E) ratio is 38.41, higher than the industry average of 21.88. The stock is also trading above its 12-month median level of 34.46.
MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 22.59) and Sea Limited (24.24).
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What Do Earnings Estimates Signal for MercadoLibre?
The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings per share suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
The Zacks Consensus Estimate for earnings per share has declined by $1.89 to $39.11 for the current fiscal year and by $3.13 to $56.05 for the next fiscal year.
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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
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