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One Latin American online shopping company appears to have discovered the secret that has made it a giant in online retail.
MercadoLibre (My mile) It is a Uruguay-based financial and commercial services company serving clients in Latin America for over 25 years.
Like Amazon, the company supports small and medium-sized businesses and provides them with the tools they need to compete against their larger competitors.
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The online retailer has a proven track record when it comes to its finances.
According to MercadoLibre Q2 Earnings ReportThe company’s total market value reached US$12.6 billion, and its net revenue reached US$5.1 billion, which grew by 42% compared to the same period last year.
The company’s operating income amounted to $726 million, and its net income amounted to $531 million, which represents a growth of 103% compared to the previous fiscal year.
MercadoLibre The stock is up 64% from the same period last year and up 0.40% as of Thursday’s market opening figures.
Steadfast loyalty in its major markets
The online retailer has over 218 million customers in 18 countries in Latin America.
The number of unique buyers on MercadoLibre increased by 19%, and the number of items sold increased by 29% year-over-year, the highest number the company has seen since 2021.
For the company’s regional clients, Brazil generated the highest revenue with a 51.2% increase, followed by Mexico with an increase of nearly 66% and Argentina with an increase of nearly 1% compared to the previous fiscal year.
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Entering the US Market
As mentioned in its second-quarter earnings call, MercadoLibre’s next step is to consolidate sellers in the U.S. This year, the company launched a fulfillment center in Texas, its first outside of Latin America, to expand its product assortment for Mexican consumers.
However, the border does not seem to be a difficult obstacle for MercadoLibre; the company offers its Mexican customers free shipping, with packages delivered within a few days.
Among U.S. online retailers, Amazon shares rose 32% and eBay shares rose 36.5% compared to the same period last year, making Mercado Libre’s share increase the highest of the three.
“We think this could be multi-country in the future, but it’s too early to tell,” MercadoLibre’s chief merchandising officer, Ariel Szarvestein, said during a second-quarter earnings call about the company’s U.S. expansion. “But the signs of this process are really positive. We see consumers very engaged with the products we offer, and we see our sellers from the U.S.”
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Number efficiency through robotics
MercadoLibre has found a way to adapt to the high demand from its customers by using technology. In June of this year, the company integrated robots into its distribution centers in Brazil to collaborate with human workers.
Currently, 100 robots are integrated, but the company plans to integrate more than 300 robots by the end of the year. This technological integration has improved production by 20% by reducing repetitive tasks.
“This is the moment to confirm our belief that the best is yet to come,” Mercado Libre CEO Marcos Galperin said during the second-quarter earnings call.
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