MercadoLibre's AI Investments Are Set to Drive the Next Growth Chapter

Artificial intelligence is becoming a broader productivity and monetization tool at MercadoLibre, Inc. MELI. During the second quarter of 2026, the company’s AI investment grew roughly $80 million year over year, with spending split between the cost of goods sold and Product Development. Management highlighted several areas where the technology is already producing tangible returns. 

Management said about 20,000 MercadoLibre developers are now using AI, with human-written code becoming the exception. Code submissions increased 110% year over year, merged code more than doubled, and deployments rose nearly 75%, even as rollbacks declined. MercadoLibre also said AI agents independently reviewed more than half a million code submissions and migrated roughly 9,000 services to newer platforms over the past year. 

AI is also becoming more visible in the marketplace. MercadoLibre completed the rollout of its AI-powered search architecture across its five largest sites, generating higher conversion and click-through rates that management said more than offset third-party LLM costs. Seller Assistant usage is also rising, with sellers representing almost half of GMV using the tool and more than half of Help Portal requests resolved without human intervention. 

Higher AI spending has not prevented operating efficiencies. Product Development expenses fell to 7.2% of net revenues from 8.4% a year earlier, while cost per token declined both sequentially and year over year. Management views AI less as a cost line to optimize and more as an accelerator, supported by 27 years of proprietary data across commerce, payments, credit and logistics.

How Does MercadoLibre Stack Up Against Its Industry?

MercadoLibre, which competes with Amazon.com, Inc. AMZN and Sea Limited SE, has seen its shares gain 15.2% over the past three months compared with the industry’s 3.8% rise. While Amazon shares have climbed 4.3%, Sea Limited has rallied 22.6% in the aforementioned period.
 

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What Does MercadoLibre's Current Valuation Suggest?

From a valuation standpoint, MercadoLibre's forward 12-month price-to-earnings (P/E) ratio is 37.18, higher than the industry average of 20.87. The stock is also trading above its 12-month median level of 34.46.

MercadoLibre is trading at a premium to Amazon (forward 12-month P/E of 22.70) and Sea Limited (21.49).

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What Do Earnings Estimates Signal for MercadoLibre?

The Zacks Consensus Estimate for MercadoLibre’s current financial-year sales implies year-over-year growth of 44.6%, while the consensus estimate for earnings per share suggests a decline of 0.7%. For the next fiscal year, the consensus estimate indicates a 28.9% rise in sales and 43.3% growth in earnings.
 

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MELI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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