(Reuters) – MercadoLibre Inc said it was so far managing to recoup higher costs by boosting its prices as the South American e-commerce giant reversed a year-ago loss, helped by growth in its financial services unit.
Chief Financial Officer Pedro Arnt said in a call with analysts that MercadoLibre was trying to “pass on” costs due to increases in transport, labor and oil prices.
“I think we’ve done a good job of trying to offset that pressure through pricing,” he said.
The Nasdaq-listed Argentine company posted quarterly earnings of $65 million after a year-ago loss of $34 million, although the profit figure missed the Refinitiv analysts’ forecast.
The company’s net revenue rose 67.4% in local currency to$2.2 billion as strong growth in its fintech unit Mercado Pago helped offset a post-pandemic slowdown in new clients at Mercadolibre’s core e-commerce business.
“Marketplace growth remained consistent, mainly due to the behavior and growth of buyer base,” Chief Financial Officer Pedro Arnt said in a statement.
The company, present in 18 countries including Brazil, Mexico and Colombia, said active users rose 15.7% rise over a year ago to 80.7 million, although that represented a slight drop from the end of December.
Its gross merchandise volume (GMV), a widely watched figure for the e-commerce industry’s performance, rose 26.5% from a year earlier to $7.7 billion.
Mercado Pago reported a 72% jump in total payment volume to $25.3 billion. The unit, which operates in credit, insurance and investments, now accounts for 45% of the group’s revenues in Brazil, its main market.
Mercado Pago’s loan book reached $2.4 billion in the quarter, more than four times higher the same period from 2021.
Executives said on the conference call with analysts that they were looking to “significantly expand” their buy-now, pay-later service, called Mercado Credito, in the future.
(Reporting by Aluisio Alves and Kylie Madry; Writing by Carolina Pulice; Editing by Leslie Adler and Diane Craft)