Image: MercadoLibre.

International e-commerce pioneer MercadoLibre (MELI -4.21%) has suffered from the difficult times that Latin America has experienced in recent years. Yet all the while, the company has combined the marketplace prowess of U.S. counterpart eBay (EBAY -1.12%) with the ancillary payment systems that PayPal (PYPL -1.84%) offers.

Coming into Thursday's fourth-quarter financial report, MercadoLibre investors hoped that this powerful combination would be able to minimize an expected earnings drop, and produce at least some revenue gains. But the company's performance was actually much stronger. Let's take a closer look at how MercadoLibre defied its skeptics, and what could lie ahead for the Latin American e-commerce giant.

MercadoLibre rides Latin America higher
MercadoLibre's fourth-quarter numbers were quite impressive. Revenue climbed 12%, to $180.7 million, roughly doubling the 6% growth rate that most investors were expecting to see. Net income managed to rise an even more impressive 14%, and that resulted in earnings of $0.88 per share, topping the consensus forecast by nearly $0.20, and overcoming expectations for a roughly 10% decline from year-ago levels.

MercadoLibre's operational results were equally strong. Items sold rose 27%, to 36.8 million, representing an even faster growth rate than in the third quarter. Strength in Argentina was primarily responsible for that gain, with the South American country seeing a 58% growth rate compared to 2014's fourth quarter.

Gross merchandise volume climbed 12% to just over the $2 billion mark, and in local-currency terms, extraordinary growth of 86% was even more impressive, and pointed to the way in which MercadoLibre has used eBay's marketplace model to perfection.

Meanwhile, the company's PayPal-like MercadoPago service saw good results. Total payment transactions climbed 79%, to 25.4 million. Total payment volume rose 42% in dollar terms, to $1.56 billion, and it nearly doubled when you measure the results in local currencies. The MercadoEnvios shipping service climbed above the 50% mark in the company's four major markets, and it approached 70% in the key Brazilian market.

Another key initiative that has driven growth is MercadoLibre's financing option. Revenue from financing grew 57% thanks to high usage of interest-free listings in Brazil. Response to the service in Mexico and Argentina has also been positive. Advertising revenue more than doubled in local-currency terms, and mobile listings and payments have seen encouraging results, as well.

CFO Pedro Arnt was amazed by the company's performance. "We exited 2015 on a favorable trajectory across all our major initiatives," Arnt said, "allowing us to wrap up one of the strongest years ever in terms of executing the strategic vision we set forth for the company." He also pointed to the company's full-year growth performance, which included more than 128 million items sold, and 80 million total payment transactions.

Can MercadoLibre keep moving forward in 2016?
The nice thing about MercadoLibre is that its growth tends to build on itself. The company has seen a nearly 20% rise in registered users during the past year, ending 2015 with 144.6 million. Just as eBay used its beneficial network effects to lure in merchants and attract people to its PayPal service back when eBay and PayPal were under the same corporate umbrella, so, too, has MercadoLibre used the combined power of its marketplace, its MercadoPago payments service, MercadoEnvios shipping, and now its financing arrangements, to draw more users. That makes the service more attractive to merchant partners, helping growth feed on itself.

Moreover, MercadoLibre has no apparent plans to follow eBay's footsteps by spinning off PayPal. That should help MercadoLibre reap the full rewards from its integrated offerings, which together create an attractive package for users.

Investors were happy with MercadoLibre's results, sending the stock up 5% in the first half-hour of after-market trading following the announcement. Latin America's woes might not be over, but even the prospect of a potential bottom is making investors excited about the potential of the e-commerce market for the region. Keep an eye on MercadoLibre as 2016 proceeds, and macroeconomic conditions develop.