SAO PAULO (Reuters) – The Free Market had a slowdown in revenue in the third quarter, as the gradual reopening of physical commerce in Latin America has imposed greater competition with digital companies, which soared during the pandemic.
The largest e-commerce portal in Latin America reported on Thursday that its sales volume (GMV) reached 7.3 billion dollars from July to September, an increase of 29.7% in constant currency over the same stage of 2020.
But the movement represents a slowdown in relation to the 117.1% expansion registered a year earlier, also in the annual comparison.
This more modest expansion partly reflected the loss of traction in acquiring new customers. The company ended September with a base of 78.7 million unique users, an increase of 3.4% in 12 months. A year ago, this expansion had been 92.2%.
Even so, the Free Market had a net revenue of 1.9 billion dollars in the quarter, an increase of 72.9% against the same stage of 2020 in constant currency. In Brazil, which accounts for 57% of total revenues, the increase was 69%.
The total volume of payments made through the Mercado Pago unit in the quarter amounted to $20.9 billion, up 59% in constant currency. The company’s loan inventory reached $1.1 billion at the end of the quarter, nearly four times more than a year earlier.
“We are entering a base maturation process, in which the main objective is to retain customers, encouraging them to make more transactions that yield revenue,” the Market’s vice president of strategy, corporate development and investor relations told Reuters Free, André Chaves.
According to the executive, since the focus of digital business companies moves to retain customers and make them transactional in a profitable way, the Free Market should have comparative advantages, since its efforts in recent quarters to expand its logistics structure. will allow for gains in scale and greater cost control.
“This is especially important now at a time of rising fuel prices,” he said. In addition, the group based in Argentina also started to finance itself more with CDBs, which have a lower cost than receivables.
The combination of revenue growth and expense control helped Mercado Livre net income of US$95.2 million in the quarter, more than six times the volume reported a year earlier.
Chaves stated that the shortage of chips has had some impact on sales of payment terminals (POS) in Mercado Pago, but that the company is seeking to normalize the situation by seeking more suppliers for the equipment.
(By Aluísio Alves)
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