Sea Limited, together with its subsidiaries, engages in the digital entertainment, e-commerce, and digital financial service businesses in Southeast Asia, Latin America, rest of Asia, and internationally. It offers Garena digital entertainment platform for users to access mobile and PC online games, as well as eSports operations. The company also operates Shopee e-commerce platform, a mobile-centric marketplace that provides integrated payment and logistics infrastructure and seller services. In addition, it offers SeaMoney digital financial services to individuals and businesses, including offline and online mobile wallet, and payment processing services, as well as other offerings across credit, insurtech, and digital bank services under the ShopeePay, SPayLater, SeaBank, SeaInsure, and other digital financial services brands; and payment processing services for Shopee. The company was formerly known as Garena Interactive Holding Limited and changed its name to Sea Limited in April 2017. Sea Limited was incorporated in 2009 and is headquartered in Singapore.

Sea Limited выглядит как компания, которая уже прошла фазу убыточного роста и перешла к более качественной генерации прибыли, но рынок по-прежнему оценивает её с заметной премией. Сильная сторона — очень низкая долговая нагрузка: debt/equity всего 0.03, а долг за последние периоды заметно снизился, что уменьшает финансовые риски. Ликвидность комфортная: quick ratio 1.57 и current ratio 1.44, при этом денежная позиция 11.9 млрд выглядит солидно относительно обязательств. Рентабельность тоже улучшилась: gross margin держится около 45%, net margin вырос до 6.88%, ROA 5.79% и ROI 11.16% находятся на хороших уровнях и в целом улучшаются по годам. При этом ROE 15.16% уже выглядит неплохо, но не настолько выдающимся, чтобы оправдывать очень высокие мультипликаторы без скидки на риск. Выручка, валовая прибыль, EBITDA и чистая прибыль растут, что подтверждает улучшение операционного качества и масштабируемость бизнеса. Однако оценка остаётся дорогой: P/S 2.36 более чем в 3.5 раза выше медианы отрасли, P/B 7.25 также сильно выше нормы, а P/E 33.68 всё ещё выше отраслевого уровня. P/FCF 15.59 уже не выглядит экстремальным, но и не даёт явного запаса прочности для переоценки вверх. Отсутствие дивидендов означает, что инвестор получает ставку только на рост и дальнейшее улучшение маржи, а не на текущий денежный поток. Важный плюс — динамика мультипликаторов в последние периоды в целом снижается, что говорит о том, что фундаментал догоняет цену, но премия к сектору всё ещё сохраняется. В сумме это поддерживает умеренно осторожный взгляд: бизнес качественный и финансово устойчивый, но текущая оценка уже учитывает значительную часть позитивных улучшений. Для инвестора это скорее история про удержание с ограниченным потенциалом переоценки, чем про явную недооценку.

Sea Limited

Sea Limited улучшила прибыльность и ликвидность, но торгуется с высокой премией к отрасли, поэтому фундаментал поддерживает лишь умеренно осторожный взгляд.

MercadoLibre MELI presents a concerning investment picture that should give potential investors serious pause. While the Latin American e-commerce giant reported revenue growth of 49% year over year to $8.85 billion in the first quarter of 2026, a deeper dive into the company's financial health reveals troubling trends that suggest investors would be wise to steer clear of this stock for now.
The Zacks Consensus Estimate for 2026 earnings has been revised downward by 14.4% over the past 30 days to $40.97 per share. The market appears increasingly pessimistic about MELI's near-term growth trajectory.
MercadoLibre, Inc. Price and Consensus
Operational Margin Erosion Threatens MELI’s Growth Outlook
MELI's margin erosion appears structural rather than temporary. The company is pursuing an aggressive growth strategy centered on expanding logistics infrastructure, increasing fulfillment capacity, scaling first-party inventory operations and enhancing cross-border commerce capabilities across Latin America. While these initiatives have supported strong revenue growth and market share gains, they require substantial capital and operating investments that are weighing on profitability.
The pressure is unlikely to ease anytime soon. MELI recently implemented targeted take rate reductions for competitively priced sellers in Brazil, with the financial impact expected to begin flowing through results from the second quarter of 2026. Combined with continued free shipping expansion and investments aimed at driving buyer engagement, these actions are poised to create additional margin headwinds over the coming quarters.
The first-quarter 2026 operating margin declined 600 basis points to 6.9%, reflecting the growing cost of supporting MELI's expansion strategy. Management has indicated that investment intensity is likely to remain elevated as opportunities continue to emerge across both commerce and fintech. The company continues to prioritize ecosystem expansion and market share gains over near-term profitability, meaning top-line momentum is not translating into proportional earnings growth. However, peers such as Amazon AMZN and Sea Limited SE have managed to sustain comparable growth trajectories while maintaining more credible paths to margin improvement, a balance MELI has yet to strike.
MELI's Expanding Credit Book Hurts Profitability
MELI's rapidly expanding credit portfolio is emerging as a growing drag on profitability as the company pushes deeper into financial services. The credit book nearly doubled year over year to $14.6 billion in the first quarter of 2026, driven by aggressive credit card issuance, expanding consumer lending and broader credit penetration across Latin America. While lending has become an important growth engine for Mercado Pago, the strategy is simultaneously increasing exposure to provisioning costs and credit losses. MELI has been extending average personal loan durations in Brazil from five months to eight months and broadening credit access to newer, less tested borrower segments, which is expected to increase risk exposure over time and require higher upfront provisioning.
The broader backdrop adds another layer of concern. Latin American economies remain susceptible to inflation, currency volatility and shifts in consumer spending patterns, any of which could pressure repayment trends and push provisioning costs higher. Intensifying competition from Nu Holdings NU may further compel MELI to stay aggressive on credit origination and customer acquisition, limiting its flexibility to moderate growth if credit conditions weaken. With the credit book growing nearly twice as fast as overall revenues, the provisioning drag on margins is unlikely to abate until the portfolio matures.
MELI's Premium Valuation Offers Limited Upside
MELI trades at a premium price-to-earnings multiple of 32.63X, well above the Zacks Internet Commerce industry average of 21.88X and the Retail-Wholesale sector average of 23.04X. The stock's Zacks Value Score of D further suggests that the valuation is stretched relative to fundamentals. Unlike Amazon, which has demonstrated operating leverage in its e-commerce model, Nu Holdings, which is scaling fintech operations profitably, or Sea Limited, which has been steadily improving unit economics across its commerce and digital financial services segments, MELI's profitability trajectory remains uneven, which makes the premium difficult to justify.
MELI Stock’s Valuation
Image Source: Zacks Investment Research
On a year-to-date basis, MELI’s shares have declined 19.9%, underperforming the broader sector's gain of 0.2% and the industry's decline of 1%. Amazon’s shares have returned 6.3% over the same period. While Nu Holdings and Sea Limited’s shares have declined 30.7% and 33.7%, respectively, amid broader emerging market pressures, MELI's losses reflect company-specific concerns around profitability rather than purely macro headwinds.
Image Source: Zacks Investment Research
Conclusion
MercadoLibre faces a confluence of challenges that make it an unattractive investment proposition at current levels. Structural margin erosion, a rapidly expanding credit book and regional macroeconomic uncertainty collectively paint a difficult near-term picture. With earnings estimates revised sharply downward, the stock underperforming peers on a year-to-date basis and no credible path to margin recovery in sight, downside risks remain elevated.
MELI carries a Zacks Rank #5 (Strong Sell), suggesting that it would be prudent for investors to stay away from the stock until meaningful operating leverage and valuation support reappear.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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3 Key Reasons Investors May Want to Avoid MercadoLibre Stock Right Now

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares MSCI All Country Asia ex Japan ETF (Symbol: AAXJ) where we have detected an approximate $171.2 million dollar outflow -- that's a 4.0% decrease week over week (from 35,200,000 to 33,800,000). Among the largest underlying components of AAXJ, in trading today PDD Holdings Inc (Symbol: PDD) is up about 1%, Sea Ltd (Symbol: SE) is down about 1.6%, and H World Group Ltd (Symbol: HTHT) is up by about 0.1%. For a complete list of holdings, visit the AAXJ Holdings page » The chart below shows the one year price performance of AAXJ, versus its 200 day moving average:
Looking at the chart above, AAXJ's low point in its 52 week range is $78.0922 per share, with $123.16 as the 52 week high point — that compares with a last trade of $122.55. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Further AAXJ Research:
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Notable ETF Outflow Detected - AAXJ, PDD, SE, HTHT

Key Points
Sea Limited operates three core businesses spanning e-commerce, digital financial services, and gaming.
Sea delivered accelerating revenue growth during the first quarter of 2026, with strong contributions from all three of its businesses.
Sea stock looks cheap right now, and Wall Street thinks there could be significant upside ahead.
Sea Limited (NYSE: SE) is a triple threat in the digital economy. The Singapore-based company operates the largest e-commerce platform in Southeast Asia, a booming digital financial services business, and a game development studio that is responsible for some of the world's most successful mobile titles.
Sea stock is down 34% this year amid soaring oil prices, sparking concerns about a potential drop in consumer spending, but this could be a great long-term buying opportunity. In fact, the majority of the analysts tracked by The Wall Street Journal gave the stock a buy rating, and none recommend selling.
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The most bullish analyst in the group predicts the stock could soar by a whopping 124% from here. I think that is realistic, which is why I bought Sea stock myself back in March.
Three spectacular growth stories under one roof
Shopee is Sea Limited's hybrid consumer-to-consumer and business-to-consumer e-commerce platform. It serves most Southeast Asian countries, including Singapore, Indonesia, and Malaysia, and is also expanding into Latin America, with a fast-growing presence in Brazil. Shopee processed over $37 billion in orders during the first quarter of 2026 (ended March 31), up 30% from the year-ago period.
Then there's Monee, which is Sea's digital financial services platform. It lends money to Shopee sellers to help them grow their businesses, and it also provides buy-now, pay-later loans to consumers to boost their spending power. Monee had a record $9.9 billion in loans on its books at the end of the first quarter, a 71% year-over-year increase. Brazilian borrowers accounted for $1 billion of those loans, which was up by an eye-popping 250%.
Sea's third business segment is digital entertainment, led by the Garena game development studio. Garena's most successful mobile game is Free Fire, which has been downloaded around 2 billion times worldwide, but it also owns other blockbuster titles like Call of Duty: Mobile and EA Sports FC.
The studio had 666.5 million users across all titles during the first quarter, which was up modestly from the same quarter last year. But the percentage of users who made in-game purchases came in at 10.9%, the best result in five years.
Accelerating revenue growth
Sea Limited generated $7.1 billion in total revenue during the first quarter, which represented a blistering year-over-year growth rate of 46.6%. It marked an acceleration from the company's 36.4% revenue growth for the whole of 2025, and all three business units contributed to the strong result.
Segment
Q1 2026 Revenue
Growth (YOY)
E-commerce (Shopee)
$5.1 billion
45.1%
Digital financial services (Monee)
$1.2 billion
57.8%
Digital entertainment (Garena)
$696.6 million
40.6%
Sea also had a great quarter at the bottom line, delivering $1 billion in adjusted non-GAAP (generally accepted accounting principles) earnings before interest, tax, depreciation, and amortization (EBITDA) for the first time ever. Although Shopee accounted for most of the company's revenue, it contributed just $223.2 million in adjusted EBITDA because of its razor-thin margins. The platform aims to give consumers the lowest possible prices, which isn't a recipe for big profits.
Sea's largest contributor to adjusted EBITDA was Garena, which generated $573.6 million despite its comparatively small revenue base. This is one of the benefits of Sea's highly diversified business.
I agree with Wall Street's bullish consensus on Sea stock
The Wall Street Journal tracks 30 analysts who cover Sea stock, and 23 have given it a buy rating. Two others are in the overweight (bullish) camp, while the remaining five recommend holding. Sea has attracted no sell ratings from this group of analysts.
The analysts have an average price target of $141.55, which suggests Sea stock could climb by 63% over the next 12 months or so. However, the Street-high target of $195 implies a potential upside of 124% instead.
I think both targets are achievable based on Sea's attractive valuation. Its stock is trading at a price-to-sales (P/S) ratio of just 2.1, which is well below its three-year average of 3.3. Moreover, Wall Street expects the company's annual revenue to grow to $29.8 billion in 2026 and $36.2 billion in 2027 (according to Yahoo! Finance), placing its stock at forward P/S ratios of 1.78 and 1.47, respectively.
That means Sea stock would have to climb by 124% by the end of 2027 just to trade in line with its three-year average P/S ratio of 3.3. And if the company's revenue growth continues to accelerate, I think its valuation could rise even further.
But another reason I like Sea is its rock-solid balance sheet. At the end of the first quarter, the company had a whopping $11.1 billion in cash, cash equivalents, and short-term investments, with less than $800 million in debt. That gives management an incredible amount of flexibility to invest aggressively in growth, which could be very bullish for shareholders over the long term.
Should you buy stock in Sea Limited right now?
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Anthony Di Pizio has positions in Sea Limited. The Motley Fool has positions in and recommends Sea Limited. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

1 Spectacular Growth Stock to Buy Before It Soars by as Much as 124%, According to Wall Street

Sea Limited (NYSE: SE) is putting together an impressive push for market share.
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Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Sea Limited. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Neil Rozenbaum has positions in Alphabet, MercadoLibre, Micron Technology, Nebius Group, Netflix, Robinhood Markets, and SoFi Technologies. The Motley Fool has positions in and recommends Alphabet, MercadoLibre, Micron Technology, Netflix, and Sea Limited. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Is the AI Trade Finally Too Crowded? Here Are the Stocks I'd Buy on the Next Dip

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Sea (SE) Q1 2026 Earnings Call Transcript

MercadoLibre MELI shares have declined 15.6% following the release of its first-quarter 2026 results on May 7, 2026, as investors reacted negatively to another quarter of aggressive spending, margin compression and rising credit-related risks despite strong top-line growth. The selloff reflects growing concern that MELI is prioritizing scale expansion and ecosystem investments at a time when profitability visibility is weakening and free cash flow remains under pressure.
On a year-to-date basis, MELI has plunged 21.6%, underperforming the Zacks Electronic Commerce industry's return of 7.7% and the Zacks Retail and Wholesale sector's advance of 5.8%. Among Peers, Amazon AMZN has returned 15.2% year to date while Nu Holdings NU and Sea Limited SE have declined 20.7% and 24.7% respectively, suggesting regional macro conditions account for only part of MELI's relative weakness.
Let's delve deeper to determine what to do with the stock at current levels.
MELI’s Stock Performance
Image Source: Zacks Investment Research
MELI’s Revenue Momentum Masks Profitability Concerns
MELI delivered another quarter of strong revenue expansion, with net revenues and financial income increasing 49% year over year to $8.85 billion. Gross merchandise volume (GMV) increased 42% year over year, while total payment volume surged 50%. Mercado Pago’s monthly active users crossed 83 million, highlighting strong engagement trends across the ecosystem.
However, beneath the headline growth, profitability continues to weaken materially, driven by rising provisions, shipping subsidies and the upfront costs of scaling the credit card portfolio across three markets. Operating income declined 20% year over year to $611 million and operating margin compressed 600 basis points to 6.9%, while net income fell 16% to $417 million, producing an EPS of $8.23, missing the Zacks Consensus Estimate by 6.26% and declining 15.5% year over year.
The Zacks Consensus Estimate for second-quarter 2026 EPS is pegged at $9.94, revised down 17.4% over the past 30 days and implying a 3.59% year-over-year decline, suggesting the earnings pressure is not yet at its trough.
MercadoLibre, Inc. Price and Consensus
MELI Deepens Investment Cycle
MELI is simultaneously deploying capital across free shipping, a rapidly scaling credit card portfolio, first-party inventory, cross-border trade and fulfillment infrastructure, each investment track carrying long payback horizons. The fulfillment network spans over 50 facilities and handled 55% of shipments in the first quarter, reflecting growing operational scale. Cross-border trade grew 68% year over year on a FX-neutral basis as friction was removed from the international drop-shipping model. These initiatives are accelerating engagement and transaction growth, but they are doing so at the expense of near-term margins and earnings visibility.
The credit card expansion adds a separate layer of pressure. Rapid scaling across three markets requires upfront provisioning and funding costs that delay profitability at the portfolio level. While older Brazilian cohorts are maturing as expected, the credit card book more than doubled to $6.6 billion, and issuance is accelerating in Mexico and Argentina, meaning the provisioning drag is widening before it narrows.
MELI’s marketplace momentum is dependent on promotional intensity to sustain itself. Lower seller take rates, broader free shipping incentives and continued first-party inventory investment are strengthening assortment and conversion, but each represents a recurring cost rather than a one-time investment. If consumer demand softens across Latin America, the economics of sustaining this level of promotional activity become considerably harder to defend.
Competition and Valuation Offers Little Comfort for MELI
The competitive backdrop is intensifying for MELI as Amazon continues raising the bar on logistics efficiency and marketplace standards in Brazil, a market where MELI is simultaneously absorbing rising fulfillment costs. Nu Holdings is deepening financial product penetration across the same core markets with a leaner model that is already translating investment into near-term earnings, whereas MELI's fintech margins continue to compress. Sea Limited, having completed its profitability reset, is now competing with the cost discipline that MELI has explicitly deprioritized, a dynamic that makes defending market share increasingly expensive.
MELI trades at a forward price to earnings multiple of 28.77x, above the industry average of 24.44x and the sector average of 24.77x. Among peers, Amazon trades at a comparable 28.7x but with stronger free cash flow visibility and a diversified earnings base. Nu Holdings and Sea Limited trade at 13.94x and 19.7x, respectively, both at meaningful discounts to MELI despite operating in overlapping markets with improving profitability trajectories. With the investment cycle deepening and no clear timeline for margin recovery, MELI's premium over peers looks difficult to justify.
MELI’s P/E F-12m Valuation
Image Source: Zacks Investment Research
Conclusion
MELI's long-term structural opportunity remains intact, but the near-term investment case is difficult to defend. Margins are compressing with no clear recovery timeline; estimates are moving lower, and the stock trades at a premium to peers. MELI currently carries a Zacks Rank #5 (Strong Sell), and investors would be better served avoiding the stock until the investment cycle shows clearer signs of translating into earnings.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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Should you Hold or Fold MercadoLibre Stock Post Q1 earnings?

Sea Limited SE reported adjusted earnings of 84 cents per share in the first quarter of 2026, which decreased 2.3% from the year-ago quarter and missed the Zacks Consensus Estimate by 12.5%.
Revenues of $7.1 billion increased 46.6% year over year and beat the Zacks Consensus Estimate of $6.95 billion, primarily driven by growth in Shopee and Monee.
SE's Q1 Revenue Mix Tilts Further Toward Services
Sea Limited’s top-line mix remained services-heavy, with Service revenues of $6.5 billion and sales of goods of $612.4 million, which grew 46.2% and 50.6% year over year, respectively. The skew toward services reflects the company’s reliance on transaction-based fees, advertising and financial services income alongside its growing physical-goods footprint.
Revenue growth also stayed broad-based across Sea Limited’s three reportable segments: Shopee, Monee and Garena.
Sea Limited Sponsored ADR Price, Consensus and EPS Surprise
SE's Shopee Mix Shifts Toward Core Marketplace Fees
E-commerce (Shopee) generated $5.1 billion of GAAP revenues in the quarter, up 45.1% year over year, aided by marketplace activity and ad-led monetization. Within that total, GAAP marketplace revenues were $4.5 billion, up 44.4%, highlighting a resilient take rate as transaction volumes expanded.
The composition of marketplace revenues also shifted. Core marketplace revenues, which include transaction-based fees and advertising, rose 61.0% year over year to $3.8 billion. Value-added services revenues, largely logistics-related, declined 8.1% to $691.6 million due to a higher net-off against shipping subsidies.
Shopee's adjusted EBITDA reached $223.2 million in the first quarter, down sharply from $264.4 million in the same period last year. GMV increased by 30.2% year on year to $37.3 billion in the first quarter. Gross orders for the reported quarter reached 4.0 billion, representing a 29.3% year-over-year increase.
SE's Monee Credit Book Climbs as Asset Quality Holds
Digital Financial Services (Monee) continued to be Sea Limited’s fastest-growing revenue engine, with GAAP revenues rising 57.8% year over year to $1.2 billion. Management attributed the growth primarily to the credit business as lending activity increased, helping sustain profitability gains in digital financial services.
On the operating side, Monee delivered adjusted EBITDA of $275.2 million, up 14.0%. Consumer and SME loans principal outstanding reached $9.9 billion at quarter end, up 71.3% year over year, consisting of $8.8 billion of on-book loans and $1.1 billion off-book. Non-performing loans’ past due more than 90 days were 1.1% of loans principal outstanding, stable sequentially.
Sea Limited's Garena Sees Bookings Lift and Paying Users Rise
Digital Entertainment’s (Garena) operating backdrop improved meaningfully in early 2026, with bookings increasing 20.1% year over year to $931.4 million. GAAP revenues rose 40.6% to $696.6 million, supported by game engagement and monetization across key titles.
Profitability remained strong, as Garena’s adjusted EBITDA climbed 25.2% to $573.6 million, representing 61.6% of bookings versus 59.1% a year ago.
Quarterly active users were 666.5 million, and quarterly paying users increased 12.4% to 72.6 million, lifting the paying user ratio to 10.9% from 9.8%. Average bookings per user improved to $1.40 from $1.17 year over year.
SE's Spending and Credit Costs Weigh on Q1 Margins
Despite sharp revenue growth, margin performance was pressured by higher operating costs. Gross profit increased 40.7% year over year to $3.1 billion, but gross margin declined to 44.3% from 46.2% as cost of revenues climbed 51.7% to $4.0 billion.
Operating expenses expanded 43.4% to $2.6 billion, caused by sales and marketing expense of $1.4 billion (up 52.1%) and provision for credit losses of $465.5 million (up 65.1%). Operating income still grew 29.9% to $593.0 million, but net income rose a more modest 6.7% to $438.2 million, reflecting heavier taxes and higher credit-related costs.
SE’s Balance Sheet & Cash Flow
As of March 31, 2026, Sea Limited had cash and cash equivalents of $4.00 billion, compared with $4.16 billion as of Dec. 31, 2025.
During the first quarter of 2026, the company repurchased 1.8 million shares for $168.4 million under its $1.0 billion share repurchase program.
SE generated $1.1 billion in cash from operating activities in the reported quarter, compared with $1.48 billion in the previous quarter.
SE’s Zacks Rank & Stocks to Consider
Currently, Sea Limited carries a Zacks Rank #4 (Sell).
Cisco Systems CSCO, Analog Devices ADI and NVIDIA NVDA are some better-ranked stocks that investors can consider in the broader Zacks Computer and Technology sector. Each stock carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cisco Systems’ shares have gained 29.3% in the year-to-date period. CSCO is set to report its third-quarter fiscal 2026 results on May 13.
Analog Devices’ shares have jumped 54.7% year to date. ADI is scheduled to report its second-quarter fiscal 2026 results on May 20.
NVIDIA shares have returned 18.1% year to date. NVDA is scheduled to report its first-quarter fiscal 2027 results on May 20.
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Sea Limited Q1 Earnings Miss Estimates, Revenues Increase Y/Y

(RTTNews) - Sea Ltd (SE) reported a profit for its first quarter that Increased, from the same period last year
The company's earnings came in at $427.93 million, or $0.67 per share. This compares with $403.05 million, or $0.65 per share, last year.
The company's revenue for the period rose 46.6% to $7.097 billion from $4.841 billion last year.
Sea Ltd earnings at a glance (GAAP) :
-Earnings: $427.93 Mln. vs. $403.05 Mln. last year. -EPS: $0.67 vs. $0.65 last year. -Revenue: $7.097 Bln vs. $4.841 Bln last year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Sea Ltd Announces Increase In Q1 Profit

Key Points
MercadoLibre's operating margin was cut in half in the first quarter.
The company has lowered its free shipping threshold and its take rate in Brazil as competition heats up.
The stock looks well-priced for its growth potential.
MercadoLibre (NASDAQ: MELI) has been a top stock throughout its history as it's built Latin America's largest e-commerce and digital payments business.
However, more recently, the company has come under pressure. The stock has fallen as it has faced intensifying competitive pressure from Amazon and Sea Limited's Shopee, and at the same time, its profit margins are falling as it spends on infrastructure. That includes the expansion of its logistics network and credit business in part to fend off that competition. That also includes lowering the free shipping threshold in Brazil, its core market.
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So is the sell-off justified, or is MercadoLibre just in the middle of an investment cycle that will pay off? Let's take a look at where MercadoLibre stands after its latest report.
MercadoLibre's Q1
While MercadoLibre's declining profit has been a problem for the stock, the company continues to grow revenue at a strong pace, jumping by 46% on a currency-neutral basis in the first quarter. Its 49% reported growth was its fastest growth rate in nearly four years.
Management touted its "once-in-a-generation opportunity to transform how hundreds of millions of Latin Americans shop, pay, and access financial services," seemingly as an argument for increasing its investment, as it still sees a large growth opportunity in Latin America.
The company is also seeing benefits from lowering the free shipping threshold in Brazil, where gross merchandise volume (GMV) improved to 38%.
MercadoLibre's revenue reached $8.85 billion in the quarter, ahead of estimates at $8.3 billion. However, its operating margin fell sharply, down by six percentage points to 6.9%, which management explained as a choice to "prioritize long-term investments over short-term profitability." Over half of that was from the increase in its provisions for doubtful accounts due to the 87% growth in its credit portfolio. Operating income fell 20% to $611 million, and its earnings per share declined from $9.74 to $8.23, below the consensus at $9.37.
Is competition hurting MercadoLibre?
The biggest question facing MercadoLibre and its investors is whether competition is hurting MercadoLibre.
It's not unusual for e-commerce companies to go through investment cycles that weigh on margins. Amazon and Shopify have done this in the past, as has MercadoLibre, and they've come out on the other side every time.
MercadoLibre has gotten more aggressive to keep merchants on its platform. For example, it's lowered take rates in some categories to get merchants to maintain competitive pricing. It also acknowledged that Brazil, where half of its revenue comes from, is getting more competitive, but that the company has risen to the challenge, and its metrics show that. Management also said that new competitors are helping to drive overall growth in the online channel, adding, "The pie is increasing faster than before, and we are taking an even larger slice."
Is MercadoLibre a buy?
At this point, MercadoLibre may be feeling some impact from competition, but if it were significant, it wouldn't be able to grow its revenue of 46% year-over-year, executing across all of its businesses.
MercadoLibre doesn't provide guidance, so investors don't have insight into what management expects for the rest of the year. However, management did say the lower take rates would hit profits in Q2, so we could see margins remain weak.
At the current price, MercadoLibre's risks seem more than fully priced in. The stock is now trading below where it peaked during the pandemic, though its revenue is several times larger.
It's now trading at a price-to-earnings ratio of around 40 based on generally accepted accounting principles (GAAP), which is a great price to pay for a company growing as fast as MercadoLibre with its set of competitive advantages.
Unless its profits are permanently challenged, which seems unlikely, the stock looks like an easy winner from here.
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Jeremy Bowman has positions in Amazon, MercadoLibre, and Shopify. The Motley Fool has positions in and recommends Amazon, MercadoLibre, Sea Limited, and Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Indicator	TTM Median
P/E	33.68 20.29
Price/Sales	2.36 0.67
P/B	7.25 1.88
P/FCF	15.59 14.17

Indicator	TTM Median
ROE	15.16 14.55
ROA	5.79 4.94
ROI	11.16 8.61
Net Worth	68.93 0.88
Quick Ratio	1.57 0.91
Current Ratio	1.44 1.47

Indicator	TTM Median
Net Profit Margin	6.88 5.67
Operating Margin	8.20 8.11
Gross Margin	44.92 38.46
Return on tangible equity	15.27 20.83

Indicator	TTM Median
EPS	0.00 0.45
EPS Forecast	0.26 0.43
Revenue	5.26B 186.00M
Gross Profit	3.00B —
EBITDA	565.00M —

Sea Limited

Recent quarterly and TTM performance

Valuation

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Revenue