MercadoLibre (MELI.O): Q22026 Preview: Good Growth, but Multiple Pressure Points Persist

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MercadoLibre (MELI.O): Q22026 Preview: Good Growth, but Multiple Pressure Points Persist

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14 Jul 2026 16:57:17 ET │ 24 pages

MercadoLibre (MELI.O)

Q2 2026 Preview: Good Growth, but Multiple Pressure Points Persist

CITI'S TAKE

MELI is set to report results on August 5 after market close. Despite a

moderation in engagement trends in Brazil, with DAU growth slowing to

~35% in 2Q from ~45% in 1Q, we remain constructive on MELI’s growth Neutral / High Risk

trajectory, particularly in Brazil, where competitive intensity remains Catalyst Watch: Downside

elevated. The key challenge remains profitability. We expect 2Q margins to

Price (13 Jul 26 16:00) US$1,867.30come under significant pressure from ongoing investments in logistics,

credit (including provisions), and marketing, as well as commission rebates Target price US$2,000.00↑

such as PIX discounts and seller pricing incentives. As a result, Citi’s EBIT from US$1,950.00estimate remains roughly 5% below VisibleAlpha consensus. While we are

not making additional downward revisions to our earnings estimates, we Expected share price 7.1%continue to sit below consensus. Given MELI’s recent outperformance, with return

the stock +11% MTD, we cannot rule out a disconnect between market Expected dividend yield 0.0%

expectations and Citi’s more cautious EBIT outlook. Accordingly, we are

launching a 30-day Negative Catalyst Watch ahead of earnings. Expected total return 7.1%

Market Cap US$94,667M

Q2 Preview — For 2Q26, we are 2% above VA consensus on revenue, driven by both

stronger commerce and fintech performance. We are slightly more conservative on

gross margin, forecasting 43.0%, or roughly 20bps below consensus, reflecting a

more cautious view on COGS.