MercadoLibre (MELI +1.44%) continued its triple-digit growth streak to close out 2020 with a bang. The undisputed leader of e-commerce in Latin America grew revenue to $1.3 billion, up 149% year over year. The results were driven by online retail that soared 124%, while fintech revenue from its digital payments business jumped 60%.
It's also worth noting that the company's gross profit margin slipped to 37% from 46% in the prior-year quarter, the result of aggressive pricing and increased shipping costs during the holiday quarter.
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MercadoLibre continued to invest heavily in future growth, doubling its research and development expenses to $87.3 million up 115%, while also increasing its sales and marketing costs. This resulted in a net loss of $51 million and a loss per share of $1.02, marking an improvement from a loss of $1.11 in the prior-year quarter.
MercadoLibre's operating metrics underpin the company's torrid growth. Gross merchandise volume (GMV), or the total value of products sold in its platform, grew to $6.6 billion, up 108%. The digital payments business grew even faster, with total payment volume (TPV) of $15.9 billion, up 149%, while the number of payment transaction topped 659 million, up 131%.
Customers continue to flock to the company's e-commerce and digital wallet offerings. Unique active users grew 71% year over year to 74 million, while the number of items sold climbed to 229 million, up 110%. Mercado Envios, its shipping solution, continued to be a growth industry, as items shipped surged to 214 million, up 131%.
CFO Pedro Arnt noted that growth continued to accelerate "despite the gradual reopening of physical retail during the period." He also shared that Latin America "is the world's fastest growing region for e-commerce, according to e-Marketer," helping illustrate the long runway that remains.
