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MercadoLibre Shares Fall 7% Despite Record $10.2 Billion Revenue as Profit Margins Narrow Again
['Tony Jackson']
International Business Times Australia
The decline reflected a familiar pattern for MercadoLibre this year: strong top-line growth overshadowed by investor concern over the company's shrinking profit margins as it continues investing heavily in its commerce, fintech and logistics operations.
Record Revenue, Falling ProfitMercadoLibre reported second-quarter revenue of $10.2 billion, up 50% from the same period a year earlier and roughly $500 million ahead of the $9.7 billion analysts had expected.
The quarter marked the first time in the company's history that quarterly revenue surpassed the $10 billion threshold.
Shares had risen roughly 2% in the days leading up to the earnings release, a gain that Wednesday's after-hours decline more than erased.
A Business Still Expanding RapidlyDespite the market's repeated skepticism toward the company's margin trajectory, MercadoLibre's underlying growth metrics have remained robust throughout the year.