What happened
Shares of MercadoLibre (MELI 12.69%) bucked the broader market downturn and charged sharply higher on Wednesday, surging as much as 12.2%. As of 12:28 p.m. ET today, the stock was still up 6.2%.
The catalyst that sent the tech giant higher was its quarterly financial report, which illustrated robust growth that was better than expected.
NASDAQ: MELI
Key Data Points
So what
For the fourth quarter, MercadoLibre generated revenue of $2.1 billion, which climbed 74% year over year in local currencies. The results were driven by commerce revenue that grew 67%, while fintech revenue surged 81%.
Image source: Getty Images.
Operating income of $23.3 million turned positive, compared to a loss of $25.1 million in the prior-year quarter. But foreign currency headwinds of $56.9 million ate into the company's profits, resulting in a loss per share of $0.92, compared with a loss per share of $1.02 this time last year.
To put those numbers in context, analysts' consensus estimates were calling for revenue of $2 billion and earnings per share of $1.25.
There were plenty of reasons to be bullish on the results. Gross merchandise volume (the total value of products sold on its e-commerce platform) was $8 billion, up 32% year over year, while total payment volume (TPV) of $24.2 billion surged 73%. Helping drive its fintech growth was off-platform TPV that soared 97% to $16.1 billion, driven by 849.9 million payment transactions, an increase of 69%.
Now what
MercadoLibre bucks the traditional way of doing business on Wall Street by not providing guidance, but there is plenty of evidence that the company expects its strong growth to continue. Management noted MercadoLibre has sold 4.7 million point-of-sale devices over the past year, greatly expanding its off-platform payments business in Brazil and Argentina -- already the company's largest markets.
On the conference call to discuss the results, chief financial officer Pedro Arnt noted that not only had the company "sustained strong growth in key business metrics," but also continued to gain market share at the expense of the competition.
MercadoLibre stock has been caught in the recent tech-pocalyse, with shares currently down more than 50% off recent highs. That means in-the-know investors can get all this growth at a significant discount.
