MercadoLibre (MELI) 2 May 242024 Q1 Earnings call transcript

Hello, everyone, and welcome to the Mercado Libre Earnings Conference Call for the quarter ended March 31, 2024. Thank you for joining us.

I'm Richard Cathcart, Mercado Libre Investor Relations Officer. Today, we will share our quarterly highlights on video, after which we will begin our live Q&A session with our management team.

Before we go on to discuss our results for the first quarter of 2024, I remind you that management may make or refer to and is present may contain forward-looking statements and non-GAAP measures.

the our screen, Investor earnings to be will Relations refer in available materials please disclaimer which on also website. So on our results. let's that, begin a of With with our summary

quarter This Hello, of carry strong in user leveraging investment well-executed improvement minimized of regions by and everyone. as which in being over our performance to driven that and GMV on several a a highlight, experience countries Brazil in generated we above momentum are is QX a factors, is in and to awareness year-on-year campaign growth, marketing driving I'm report approximately specific financial solid with around infrastructure, the XX% market chip excellent peak pleased growth faster results operational growth Both target season. focus QX. Mexico. from another as we

business a and penetration we In to had also in addition, in of regular GMV operate. the all continues our markets where Mexico and solid levels Pago of Brazil. advertising grow performance Mercado which

both the we the year for highlights TPV card. impact million in Argentina, and this million had Brazil negative QX, operational in weak year. rate peso We we a accelerated in of macro growth sequentially strong delivered the last offset and in devaluation the. a during in from cars quarter. at growing credit has reached summary, strong fintech The issued countries. in acquiring $X.X a billion, from solid growing strongly and Mexico, In XXX% last of surpassing growing business the performance which the commerce both and credit portfolio Mercado $X.X Pago and quarter a X.X Some -- being

in taken and our impacts detail, this are summary in quarter, letter to the to a a of shareholders reconciliation effect performance that have this earnings on reporting of I'd presentation. turning In our our there like updates Investors quarter. find full more that financial can Before a couple highlight in financials.

headwinds QX Consolidated numbers the will grew the growth sufficient are operational year. Income Brazil. Brazil is the in impact of the a and outstanding last momentum earlier. This operations year-on-year, from large and to being to confident at cost strongly are of My and comments I mentioned ability profit, leverage. of again, both driven combination reported comparable achieve the on refer and long-term revenues to Mexico, to our our an growth, Argentina. revenues quarter the with was And had we back today in operational ambition strong growth pace Mexico to that continue that offset in grew and figures drives scale reflects efficiency expansion the by once we delivering and fast that.

Argentina lower FX updates I earlier, in Net on as impact income income faster were broadly from operation operational neutral pace grew lower that than mentioned in Furthermore, have me. partially country. losses offset income by a at the reporting a

headwind this performance Overall, we great way Argentina. anniversary. Libre Mercado is the with pleased to a of from in are business QX the despite And XXth the very

on looking more we over XX for the past the the ahead Richard have to over years, solid years pass XX I'll Now Libre. Mercado next foundations of for built

region. in leading and America. made the XXth technology a its financial And company in look Mercado and the on region its tech anniversary. will progress Meli the democratizing, being major is for Today, In is Latin in innovation, we Libre impact globally, services in and back XXXX, celebrate company and growth we've recognized commerce the the

a XX forward XXXX. still as great the we with In and our market. mission to addition in to is are has plenty opportunities optimism In impact, our disruption. America, continue far for from grow Latin Libre Mercado to and services see next provides and years since to ripe growth in mature us region We financial addressable shareholder track a consistent record fulfill large of generating confidence value business that with of look e-commerce and a IPO

drives our buyers the invest from which buyers drives we an and natural have as which engagement more significant to ever-improving platform best receive delivery as by new network value offering region, potential has sellers higher and We maximize and of a uniquely most on powerful for become their assortment frequency network growth the and destination are region the buyer and a effect traffic, rise widest for while e-commerce sellers. retail in self-reinforcing the UX, and leading by and in extensive sales prop, penetration traffic the growth. This capitalizing

of X our and offer in capabilities largest to media extensive targeting advertisers first-party building region, complete also retail leverages data strategy. audience funnel unique full the platforms We're the which

the challenging merchants of and become the large are status in financial services array individuals offering and in We by region's underserved fintechs. wide leading of for quo services easy-to-use by incumbents have a X we markets

credit services. in operate is fintech and and the in region. serve which enables enabled uniquely to It's lowest to business, a or cost have Our view the ecosystem data competitor a better Its our of risk to us is also cross-sell. rich us matches

our We back have acquiring built the business a developed profitable of the highly and for technology marketplace. know-how on

of placed market across X largest market well this and region. gains are the for are the We share in fintech

of ambition in heart And the most do. We loyalty engineers ensures product innovation of the of everything largest by in valued region of the the is and with ecosystem also the building being development. and at having X unique offer we to teams Melimize region leveraging largest benefits the are nonstop our

with mix ample monetization. diversified a have of opportunities revenue for growth We

with and and encourages discipline Libre's serve people growth intrinsic solid we profitability. inclusion. tech Mercado financial powerful we structures mentality, on impact mean the low-cost have sustainable entrepreneurship financial scale, Our

is of last years, far the We are mission proud from achievements the complete. XX but our over

confident President; growth. look disruption, that optimistic to market leader come.[Operator President; a far confident los are leaders are we yet is ripe Q&A to that and while Szarfsztejn, are Commerce the services we we e-commerce FinTech our Gimenez, is and mature CFO, of and next we the financial de future As Ariel Q&A in years from is Joining best the forward that please X our roster. for an Instructions] in Osvaldo us the in compile the market for XX wait Santos, Martin as

from comes with Andrew question first Morgan Stanley. Our Ruben

on Congratulations helpful the table that you provide XX years. It's and down release peso-denominated on the EBIT. in the the breaks non-peso

but units hit Just It Argentina a thinking as the strike didn't big X%. about business, decline, on had major EBIT. a the us you down

business So month-over-month how basis revenue perhaps how has And fast been. the and was Argentina on within could situation mismatch the between macro you you if through evolved moving had a us given hoping costs. could, walk even the where the quarter during situation you

you you are -- is thank Andrew, your Martin. Yes. question. This for

have as situation some marketplace, resilient reduced know, in margin is business -- X of which we then seen pressure -- you even faced we The to volume consumption. reduced demand As margin Argentina, we know, puts manage Argentina, macro that you the a Argentina things size EBIT of of of the is though, type obviously you evaluation as know, happening. and operation. in And high our terms we situation. business. And We've which this very

volume the country, So outperformed commerce of the in general business. of side in we but Argentina some we loss I the think consumption in in suffer did the

our inflation terms up some was terms country. in And of cost in of Argentina. pressure our In There that shipping cost then situation in of saw we line to mismatch, on the the some P&L. I think wrap

performed On fintech extremely the the business side, well.

products, active We brand investment and number more running acquiring the then at have in year-on-year. Argentina of the in also users We users for continue a doubled XX% growing XXX% inflation very to strong year-on-year. XX% Argentina, growing business than

in I income, then you exchange as So of rate the compensated think in the below operating in has -- Argentina of that's significantly so FX you lower normalizing. that's see can income terms -- We double overall, effect the in income. operating situation go Argentina what see net line And been P&L. when you -- losses

So Argentina this in the Argentina. because on more quarter we net of lower that that the extraordinary partially income an I'm go Mexico the obviously, at in detail and and taxes later terms overall, sure that But headwind in I would in compensated was Brazil call. EBIT paid level we quarter a FX lower of will had say

our for question. moment next One

question with next America. of from comes Bank Bob Our Ford

economics, security you do key represent well with of in I month? per the sellers as tax as congratulations Happy any great impact the And proposed And a and what Pago Easter do issues? at much in other interoperability look GMV. of you're cuts willing XX,XXX to marketplace is GMV you those terms and -- anniversary sellers to if would And Argentina Can in from need that of percent before then quarter. quantify and Mexico? done on Argentina, the TC the that terms would on by than less the smaller what . Brazil shift turn on or of how in is

Bob, it's Martin here.

Let take first the part. me

I typically, on last because stronger this days. asking Easter a fell holiday year know, our in in countries, QX. the think I as quarter, a on days always particular, in Easter you you our effect bit X volume. fell those and we were But QX volume it's of year, reduced consecutive little because on about was see mean this

days. So by if were March, X you affected look for numbers those at the there

probably. the that reverse next a in will of happens will of of bit eventually April So play there loss was favor little which because volume, quarter opposite

terms So that's the... of in

Is that fair...

the month-by-month ever we March, when But what talk happens X -- points only should the in numbers. X lost month. we . way particular a I'd announced the or Given it about we is probably in that in We'll say source -- see we percentage

me part interparty question the Bob, answer Argentina. let the in of

transactions that well. account know, back, that what or Argentina, -- code we in been for is -- a card for a which in we account-to-account QR interoperate to of which our to we a have that account. X network and and successful in few few required X are and now, need part years were -- transactions, is years also there's a you the as years So a credit working transactions doing majority mandate And minor very interoperate extremely we Argentina are now to built

a a those transactions. So it payment online back, the this a transactions. is with a is part few And built not transactions way is we years not do network the way card a minor was We that as when our was process -- transactions. credit for there standard in there built volume we of

things. be need And so interoperate, able to we to X

tokenized hand, need other a be that wallets. be with On technical the on -- those we other and which counterparties, to to there's need transactions agree terms is to will requirement the on commercial to likely be for the the hand, network are banks X And be secure.

have we not involved in able that received with meanwhile, in to already are negotiating We to have sort the about those. transactions, interoperable will process. And We yet are are banks fee for some interchange we these the side, transactions. if process of but wallets we there our be tokenized or on

to our a would be And I number to our of analyzing the regarding are don't on Bob, see answer then are the observing disclose think that what going impact the that's merchants, and referring think last your we Argentina, specifically. question right you to obviously, smaller number now is reform merchants. I we on on margins

Again, congratulations. .

Our Santos comes from question next JPMorgan. with Marcelo

the for you to kind decline a is year. new there it Argentina in of versus wanted new Argentina. wanted the a you understand, more of used just given be one-off this the I disclose like level EBIT could what currency profitability Argentina level, much almost next profitable. last ask same contribution quarter Just of ongoing you to more the very reversed that the of new a quarters? be rest, Or I couple this in There the Today, this about is was to as was way Argentina, steep because in why profitability reality? something reported

to just . that. understand you. So Thank wanted I

here, for Thank your question. you Marcelo. Martin

particular, by I because Argentina, didn't think The in Mexico the had countries. Argentina we grew other relative revenue tough -- demand the also of before, tough because mentioned valuation strong Brazil definition, when affected, the devaluation and sorry, some and extraordinarily macro of macro the commerce also issues of business. side books situation. the high But to high you then rate. help some had Also at look that

mentioned, EBIT to it grew of perspective, in EBIT percentage you put XXX Argentina outside the decreased points. Argentina as Just the year-on-year, by but of

EBIT double coming other So the countries. almost from

EBIT result -- a XX%. coming to as see you Argentina is year compared the at can that, current now share of a of So that XX% the was ago, about from

devaluation of we'll for the macro QX, I think year contribution have the mentioned that terms the is other to rate it and so the exchange a reasons again, of So That is little the we that a normalized higher devaluation so not -- the That lower be used net behind EBIT results in see think to how the variance a So more bit as than is of today. losses, as again, it's have but main on normalized high, I evaluate in income lot is focus rest the level, us. FX we with more because Mercado we on But to plays the Libre. income will Argentina I metric net the earlier see okay? effect out.

distortion been have mentioning were the FX of in we saying because Argentina is a bit the that of we in now As little was behind. the a past, there in EBIT

a distortion, have and FX are normalized more new is say So I results. it's that that I of numbers of could EBIT think the something in we normal, that now in terms terms

next And Sgarz Goldman with from comes Sachs. question Irma your

I'd for logistics. like and shareholder Thank use for in Melimize the ask to about the you letter. commentary

Brazil than program offset as notable rises. and overall more you adjust the free the shipping the network you engagement and of the of Mexico. and costs Or any as efficiency curious that uplift will I'd from if in that logistics with into by that Now efficiencies? be you network take in greater to there's more units now still differences the also volume gains Mellimise provide rollout shipment? subsidies you flow further those per take-up Where program. engagement between from overall terms are Other there get and the time of

on Yes, are have -- engagement enrolled here. date seen that program. we in delivery we incremental the both Martin good of But Melimise those seen have into Irma, of volume platform. the adopting those very adoption also, many Melimise and terms members users our for

growth we driven results of Melimise. expecting are by So the that in terms

cost and seeing put operations. to year-on-year, increases here a are little we We on number shipping We the them margin. Obviously, does you. super It that that excited with with estimate bit pressure the are there, those results. our of share have some

the adds I percentage in that than but more as date then generating a minimize question, incremental think part of get the is are user on think Melimise. comes first optimizing at we're early Melimise. volume of a Remember, XX still optimization, products. of with it Meli very cost, delivery of terms that compensated that it's basis GMV to through we their points we stages which of your week And chooses

way lower So as we users. of continue optimizing to scale the Melimise, the we will the certain shipping way be able the getting cost cost to of the products products to group delivery optimize our we and by we

and and engagement by So very but very stages, it's adoption encouraged results far. so optimistic early of the

TPV Yes. also That's very may exciting. about just And in Brazil. ask reacceleration the growth I in

this the to new direction I attached on that detail market, of that the highlighted bit drivers the incremental shifting You and a and to just of get know margin more revenues but devices on comes up and this? acceleration a we was -- you've been the hoping

there the increasing Brazil, do larger been several components this, X several say able but X relevant the there -- payments where the better are rates. in them. have in better to big in merchants, Brazil. and row of been more of online are with merchants to have for now share growth a quarters we payment one, most would the by accelerate we is wallet were I several the to we and there approval able TPV So definitely mostly adding performance relevant online think drivers acceleration of And I

these mentioned go-to-market prior how an in have a seeing are business we point-of-sale the changing are basis. having quarter-on-quarter We and is business, encouraged then a been see we and And at on operations that continuing. that good calls, as on a rate accelerated by strategy, we very effect, growing we

Brazil. mostly accelerating also degree, both in online are the -- . So some but business payments, point-of-sale to

we the acquiring that, in presentation, continue see increase you can complement And the as of just of cross-selling our disclosed to credit we to monetization, users. that terms to investor on

profitability of continues business. So improve that the that to

Elliott question next Our comes from Instructions] Autonomous. [Operator Geoffrey with

The change accounting to Mercado are Envios in that very all agent principal, of impacts the clear. from

you in was for the mean what does you of on practice point terms you're that. the business change view, what in What thank the So it business practice does objective And Why why a conditions. this for But -- it? there? from mean made this of side? doing in

Geoffrey, Ariel this here. is

process the So the on we see opposite.

been into X operating own national has logistics years, occurred. that process Latin the X purely across network. with switching or we've post from our already America and And last offices building over carriers basically, So

terms what the the we've -- responsibility our been we've done something which ourselves So for is adjusted bearing execution, doing. conditions, now is and already

the new operate. So nothing of terms way there's in we

contractually I think formally occurred time. for we that and the way now process adjusting we've some operating already, are just has been and quite

Okay.

So service rather it risk national sort the taking of reflects taking risk? kind of the than you a postal

Say again? . that

So different the rather service you've than this the that's countries, essentially, risk shipping made in the the and postal . national you're taking on why change.

already We the risk. had

is last this doing costs, warehouses cetera, we've in operations, mile operation since taking which et et over our we launched own So XXXX our have what been since cetera. been line

profile Right formalizing has risk happening nothing it's that been new, So now, already. something just no changes.

. that the business there's is change risk. And that There's reflects we just operationally. make. incremental no say the would accounting is better no I This it adjustment an running. way

with Our next from Agarwala Neha HSBC. question comes

the shift mentioned riskier there you do mean the have continued cohorts. that so because much. by an And you to Just a credit but as elaborate business you decline Thank the was Could increase partly the quickly on please mix to saw the shift what cohorts. increased? of they of on in in you early XX-day in is business. a NPL, We which why

to early there increase the X delinquencies. components So in were

you hand, more riskier segments. and evaluating doing to we X because are correctly the the models reason better that pricing forecasting are at And been have accordingly. user. each the And this as On also we risk risk taking are is we therefore, of mentioned, going our risk

an priced even NPL And are credits been though with adequate higher there have so these spread.

So it's were week Because the concern with last either that collections month, therefore, following last the for days over weekend there. the of invoice were week that that the the and or the fact Good those a not a X quarter other the of nonworking happened of source we to that factor was was typical. and X last been the than March, And ended months, small lower last there of in were holidays. typically And in an was days Thursday days X there due -- passed that the had effect month. days of Friday was

If I But I in decline are there loan in quarter-on-quarter? interest understand points into rate, rate has look increase is your this excluding on the drop that the your I book. average riskier been at cohorts, when . question, a sharp priced credit about ask for and you're can XXX part provisions, of such fact card average basis expansion the why which quarter-on-quarter by driven given moving is the accordingly, probably a the of the portfolio. that interest

here. Martin It's

the to collections larger -- -- because of quarter in fact compare I to share cards, good a credit the credits despite QX the the is months firstly, sequential quarter be as very let's think which, tends strong XX the On a what you're way, the referring margins, actually, well, basis, a for typically I year-on-year, QX is think lower. and put a year. because NIM is have know, you we that of when improving we

month a a is collections. collection. QX seasonally good QX So month is for lower for

credit also originate. and provision to the accelerated growth is generates in we Speed is contributing X things our that's also So terms more originations portfolio that Remember, something upfront expected, and losses products, addition of other card fact provisions of we normal. that when the to of we that that in of happening. It's XXX% other upfront.

margin. where originations, sequentially have to worry nothing accelerated So Oswaldo on to Like a Q QX, we there's put like pressure that we about. mentioned, tends

margin at strong continue margin points. We XX.X very have EBIT animal percentage to

expected. that So it's and is something under as control

in the on a are business . higher rate looking Brazil or of modified slightly and both in last the changed we Mexico. outlook Your kind given that scenario credit at probably now for month longer

Sorry, Neha, the please? could you repeat question,

that in outlook both for both changed over now month a in we up in longer with rate for scenario originations higher probably that picking are Brazil the terms looking your has countries? and of in Mexico, last given

No, it hasn't.

to as pick card, -- continue because continue We focusing to of credit or capabilities, it then a fintech insurance our addition card book might as bring and our on fintech they the have our growing as also, product we most in underwriting confident a using Osvaldo of account. salaries critical to other loan, in And so are take credit card, mentioned. to use in They the might strategy the is on. the strategy increase benefits users cautiously the we feel debit same our for is gain has have more we credit past, products which credit stating many terms their lot on start to our card that which into a

part it's an strategy. So of our important

higher. spreads With regards expectations interest to bit Relatively a factor little rates be than we when compared being have. small the very to higher

to very are short complement typically environment. our us fact loans interest the adjust to rapidly maturity allow that, that Just changing to

So.

comes Our Maria from Clara Itau. question next with

portal accelerated of in logistics to consistent explore of and you wanted another is services quarter. improvement ahead penetration the even the for monetization average showed also that I delivery

to a company the are vocal intend being you. scenario. the start does more we for Thank such How on services. charging So far procurement from

Maria for Clara, Thanks question. Ariel here. your

in strategy for no I think us. there's change

monetization our over been the our few the we've saying in run quarters, opportunity an to last long know infrastructure. on shipping that we As increase there's

remain say, b, we gains driving continue right efficiencies with have means operate and inflation to would of continue monetizing. term we focused I we know network, up on the We the we longer have, capturing most going sellers that it's just continue potential three, the the increases. our lever been costs; disciplined regarding reducing a productivity improving now, getting out particularly But consistently has another which don't which passing as penetration, through think fulfillment and time. for our we being For

with Our comes next from Fong BTIG. Marvin question

Congratulations years. XX on

So last curious a the if about Argentina a much quarter factored that. dollar to into I'd on terms. believe detail origination questions. in couple same of rate how growth I more it side. just was like little get But as

So perhaps Like can how And give many gave accelerate by originations you Meli detail just by delivery disclosure you I us some some how that quarter? second days. are then about last versus generated country. believe us on question, did performed, of your shipments channel.

could particularly that Just it us where stress is network, curious is an over if that for favor designed you it's maybe additionally, on you Or of to percentage money of on just can a go but And some just idea, all give not time? guys? cost. significant the saving idea kind really lower

we increased Argentina, terms in demand from loans. origination, we are models is for see versus be continue performing, of accelerated last are Marvin, and In with very the of most our how And coming we cautious acceleration Brazil, have we comfortable quarter. where to

We on was quarter, a in origination have that similar are last prior but And significantly versus to are we year-on-year lower terms, it elections. the than growing was at rate we is which quarter. basis, but in low Mexico, dollar significantly the a grown prior of to what

had we a to add would that that, in the middle. I devaluation And

as at very are reasons, book affects Argentina we is healthy also when have lowest you in Argentina growth NPLs the cautious, to but that Osvaldo probably mentioned. compare the But year-on-year rates the we'll a in So basis. continue

Marvin, Ariel here.

first Regarding Delivery we think investor share. Mali our slow have provided the on I time Day, in shipment details for you some with presentation,

saw our Delivery same means So that I offering down we which Most adoption free and but continue Melimize to on the think a ample delivered items shipping model basically more ASP the seeing your in same a savings using you with question can scaling -- the we even costs method. delivery coming in that see can be were driving were the are box more we from which is coming Meli transactions through consolidate we items. delivery program more, box delivered items think for incremental that in To even slow more good than of MDD same delivery of shipments room more as Day, route, in buyers whenever or could from that economics, per low of and well. to and get routes, as the density still, that more there's X%

good so So progress far.

with excited seen, but we've also there the are results We that opportunity the is relevant.

Our next from Craig comes FT question with Partners. Mauer

Happy the wanted an ad GMV penetration the ask to to related X.X% anniversary. from was improvement adoption? Argentina? Or moved down this that coming up actual I Was in X.X%. to . this about rate

Ariel here again.

So we had ad. in a very strong quarter

As you and Q-on-Q basis revenues currency. XXX% almost penetration dollars points in up constant said, XX year-over-year, went in XX% grew

highest growth, in dollars increase saw every penetration actually only the definitely a the both think I in is country and terms terms revenues of percentage of coming GMV. Mexico across not from penetration presented of and in as Argentina. We in a increase consistent

quarter So and capturing of convinced overall, continue us in front levers remains we more excited have big, many what to and have that. that happened importantly, the this be opportunity to we

in remind that number be just should that you out watching for? . there's seasonality any if we Can

a that reason No, in product both several in think seasonality. specific improvements, in results. on we we of made changes our there's the don't the our terms we We bidding use made processes, sales algorithms placements for

us did get help acceleration So there. parts many some that moving

And our Kai next from UBS. question with Prado comes

Hello, everyone. here on my questions. X please. evening. the have Thanks opportunity side, Good I for for

okay. fintech, on questions X the First,

is made if you the the could and why behind explain Mexico. First, that this And you now? to quarter, related reclassification on did decide change this rationale you the this accounting second to do

on the your difficult growing they're ether, business the with should please for specifically lines to Fintech Because the much could that you be see not help financial make this business. make us financial fintechs there, plan a Brazil, behind to the the more If business much instance. compete the having more or there business. in Marketplace looking than for is if understand the to strategy Is banking are

our And for on for to You if your view need to there way and well. lending investments, any public license you some planning us as are partners understand. would like other this

Martin here.

business, reporting income the Mercado update, cost we in evolved the as investor wallet the digital we of we that being Pago business within interest now. a lot to a the brought of we and did basically, the we the terms on was In A that is we above -- being from as had in operation, explained operation the what banking float EBIT below more EBIT business of which whole past, letter, right the particular had from

the that generated recognize terms of we in is been a we we reporting And our revenue and business reflection, the for have generate fact, managing sold. of So in as as that's better the nature while. this we goods And cost that way business. better quite interest our of now the cost

think an point. why at in terms I improvement this So did reason the this and this of is disclosures is we this

of Martin's and now Building when we time services. the pay even a money services. an offering fintech how so definitely we on from terms value has price larger more sellers acquiring of of from part comment, integral we been with do fintech in our Everything

largest and the is we really So business second to how we believe that in business is strategy, look question the With Mexico a our the this this our financial Mexico. business. reflects about strategy regard be better to at how and fintech

have which products X now, wallet. hand, years time We other There, of for able that, one. and of quite our will to we from together a Pago the account, offer Last have been in doing is a launched we And strongly, top on remunerated ago, is the the to market. which on third a acquired a money and several fintech party offer we X we for several on are very is quarters been to basically our credit But very, work year services a solution XX/X ago, offer for available money card, we long full-fledged account. with years. -- growing Mercado

-- opportunity we underwent market huge financial opportunity have Mexico . similar a will to lot. right increase Brazil we we where transformation and full in is be believe X that access years this market. we leaders the there's a through to increased a the our So the offering, a or in to XX lot, X a and With last now pay, in going have inclusion huge a the

for Okay. in plans your in upgrade clear. Any This is potential license a Mexico.

working regularly future, whether with We might we to do are that will And so, once we in need what have Today, to we are license. the we able Yes. do. if license reevaluate we we do you know. let anything,

Susquehanna Our Group. with comes Jamie Friedman International next question from

to ask wanted I about question a Argentina.

looked came attributed it Argentina your consumer I inflation. like in in in FX-neutral reduced than prepared So to And that demand. slower think growth remarks,

something trying that that So continue? to in I'm the past, that. has are contemplating inflation. trend Is revenue been you pattern Because that consistently to Argentina the just gauge outgrow would

So reality to -- this a that consider? . new we need is

here. Martin

this can you we consumption, growth mentioned, as decreased talk inflation. dollar about in slowdown saw but in clearly we recession quarter which was in fact, in high also Argentina was I last terms think below a year. in terms, And nominal from in

situation mentioned as macro year. operate very deal and situations. I type we'll that of the the we in through we the As these monitoring to in resilient the a it is marketplace goes with earlier, But as are country, situation

ads the state We strong. other and not past will in in of in but have seen out come markets Argentina,

We country have manage the the we'll is the strong brand, to and very fintech business. on as of continue side a it

are well As I conditions. mentioned given earlier, market we Argentina, extremely in performing the

the we retail industry. side, On outperforming the are general commerce

the complement point-of-sale we on I'd have me say seen the some side. in Let business. deceleration fintech

cautious continues the been on inflation, and However, the side. very QR And... wallet and to code, above have credit grow the strongly we

And if I shipping conditions, in . might the that missed terms change the apologize Slide what it. related X.X% up, but gears then this, on and I gross conditions, was switching of follow But to and the you have about? I margin compression if could XX, answered just

Yes.

I the think that's decreased margin have fact higher that we is the rates. because

So this the include what we try is the to try in better to of understand space that explain change that to to to normalize quarter. try we do results

this because effectively we change, denominator. So $XXX increases the revenues we that not more made that had had will roughly million have

is reduces there. we that So adjusted margin, the this and what

it This back now de CFO. to concludes Santos, like I the session. to question-and-answer los Martin turn would

Thanks, everybody, for joining.

mentioned, in results saw we profitability. tremendous improving As first both terms which Mexico are year, our growth, in saw we with also of and quarter excited that fintech with commerce particularly the we Brazil, very the about of we and XXth

of mentioned, to of that's doubled business continues result commerce efficiencies, the we Brazil we profitability. And doing margin and continue in our business Mexico very And we leverage Brazil shipping ads, to well very improve P&L. and As and as as and grow, the business also going year-on-year nicely in improving credit EBIT the Mexico gain that terms well that then acquiring combined business is of as fintech operational well. the profitability also through extremely is thriving, growing growing performing portfolio, then

we of in bottom As line net very growth terms income, year-on-year. on income mentioned strong the net

results the excited quarter. to next talking So to looking again, forward very and you about

in your program. conclude today's This the you Thank participation conference. for does

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