$MELI Risk Factor changes from 00/02/24/23/2023 to 00/02/21/25/2025

Item 1A. Risk factors—Intellectual Property Risks—We could face legal and financial liability upon the sale of items that infringe intellectual property rights of third parties and for information and material disseminated through our platforms”, which describes these risks as well as our Brand Protection Program, which we make available to IP rights holders to enable them to enforce their rights against listings on our sites that allegedly infringe upon their rights. To prevent disclosure of our proprietary information to unauthorized parties, we have also entered into non-disclosure agreements with our employees, strategic partners and suppliers.We have licensed certain proprietary rights, such as trademarks or copyrights, to third parties in the past and expect to continue to license such rights in the future. While we seek to ensure that our licensees maintain the quality of the Mercado Libre brand, they may take actions that could adversely affect the value of our proprietary rights or our reputation, which could have a material adverse effect on our business, results of operations and financial condition. See “Item 1A. Risk factors—Intellectual Property Risks—We may not be able to adequately protect and enforce our intellectual property rights. We could potentially face claims alleging that our technologies infringe the property rights of others".Table of ContentsOfficesWe are a Delaware corporation incorporated on October 15, 1999. Our registered office is located at 800 North State Street, Suite 304, Kent County, Dover, Delaware, 19901. Our principal executive offices are located at Dr. Luis Bonavita 1294, Of. 1733, Tower II, Montevideo, Uruguay, 11300.Available InformationOur Internet address is www.mercadolibre.com. Our investor relations website is investor.mercadolibre.com. We use our investor relations website as a means of disclosing material, non-public information and for complying with our disclosure obligations under SEC Regulation FD (Fair Disclosure).

We make available free of charge through our website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to the SEC. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov. Our Annual Integrated Impact report and the Sustainability Bond report are available on our investor relations website. Our Corporate Governance Guidelines, Code of Ethics, and the charters of the Audit Committee, the Compensation and the Nominating and Corporate Governance Committee are also available on our website and are available in print to any stockholder upon request in writing to MercadoLibre, Inc., Attention: Investor Relations, Dr. Luis Bonavita 1294, Of. 1733, Tower II, Montevideo, Uruguay, 11300.

Information on or connected to our website is neither part of nor incorporated into this report on Form 10-K or any other SEC filings we make from time to time. 10 | MercadoLibre, Inc.Table of ContentsAlso, some of our employees in Argentina are represented by the Commercial Labor Union (Sindicato de Empleados de Comercio) and our fulfillment employees in Argentina are represented by Sindicato de Carga y Descarga, some of our employees in Uruguay are represented by the Commercial Labor Union (Federación Uruguaya de Empleados de Comercio y Servicios), and some of our employees in Chile are represented by the Mercado Libre Chile Employees’ Union. In Mexico some of our fulfillment employees are represented by the Mexican Commercial Labor Union (Federación Obrera Sindical de la República Mexicana). Unions or local regulations in other countries could also require that employees be represented.Culture and DevelopmentOur entrepreneurial culture is the most significant attribute that makes Mercado Libre a unique place to work. This characteristic, which dates back to our early days in a garage in Buenos Aires, continues to thrive among the more than 84,000 talented individuals who comprise our exceptional team across Latin America. The DNA of MercadoLibre, embedded in our culture, is best exemplified by a proactive attitude: a relentless commitment to creating value for our users through risk-taking and innovation, all while delivering excellence as a collective. 2024 marked our 25th anniversary, and we celebrate how far we have come, achieving extraordinary and sustainable results. Throughout the years, our culture has been instrumental in shaping our Company’s dynamic and successful journey, serving as a competitive advantage and a crucial differentiator.Our leadership team plays a central role in exemplifying our culture. One of our Leadership principles is to “Lead by Example.” We expect our leaders to be the first to give their all, to inspire enthusiasm, and, above all, to embody our culture and DNA through their actions. In the past year, we have trained over 2,700 leaders to serve as multipliers of our DNA. This initiative included more than 140 training sessions focused on enhancing the impact of our leaders, emphasizing the importance of overcoming challenges, embodying a proactive attitude and delivering effective feedback. We are thrilled with the positive outcomes this initiative has generated, not only for the participants and their teams but also for the overall business results.This year, as in every year, we measured the levels of employee engagement, receiving responses from more than 60,000 employees, and we achieved a remarkable 91% favorability. This milestone is particularly significant as we recognize that managing team engagement is an indispensable responsibility of our leaders. In addition, our “Leading Operations” program trained more than 3,775 leaders to strengthen management within our logistics operations. This initiative has boosted productivity and supported our goal of expanding our logistics network to every home in Latin America.To thrive in the diverse markets we serve, attracting, engaging and developing top talent is paramount. At MercadoLibre, we achieve this by providing meaningful experiences and co-creating an environment that reflects our DNA. Our purpose is to democratize commerce and financial services to transform the lives of millions across Latin America.Generation of quality employment opportunitiesOur recruitment and hiring strategy exemplifies our commitment to being a growth engine for Latin America in response to the socio-economic challenges faced by the region in recent years. We take immense pride in creating quality employment opportunities in the region. This year, we celebrated a remarkable achievement by surpassing 84,000 employees at MercadoLibre. In 2024 alone, we welcomed more than 25,000 new team members throughout the region, particularly within our Technology, Product, and Logistics divisions. We have shown consistent expansion, nearly quintupling our workforce from 15,546 to 84,207 employees in the last four years, which means a 30 times growth over the last decade.This substantial growth distinguishes us as a leader in creating genuine employment in the region while maintaining our unique culture. Our ongoing expansion not only strengthens our position in job creation but also enhances our value proposition. The increase in direct employment drives our business forward and positively impacts indirect employment, generating numerous opportunities throughout our value chain and benefiting the hundreds of thousands of MSMEs that rely on our ecosystem. At MercadoLibre, we aspire to be the employer of choice, fully aware of the competitive landscape we navigate where effective talent management is crucial. Therefore, we are committed to honoring the value proposition we offer our employees every single day. Multiple perspectives, common purposeWe believe in effort and the value of meritocracy, and we know that the inclusion of diverse experiences drives innovation and allows us to anticipate the needs and expectations of those who choose Mercado Libre. To achieve this, we work on two complementary pillars: inclusion, through processes and actions that ensure equal opportunities within a culture that fundamentally values the meritocracy; and representativeness, promoting the inclusion of different profiles and experiences, thus reflecting the diversity of our user community.Table of ContentsToday, 93% of our employees perceive their leaders as inclusive, and this perception is held by employees across diverse groups. We also ensure pay equity by examining all groups, and there is no representative gap in any talent management processes, such as performance evaluations, promotions, and internal rotations. Our priority is to guarantee an inclusive and respectful environment. In 2024, we created the Inclusion Insights Team, an intersectional team whose mission is to ensure that our initiatives and processes are inclusive and incorporate a multiplicity of perspectives and experiences, enabling a great place to work for all people. The group is led by the Inclusion team and consists of 13 representatives from different groups (women, men, employees over 40, people with disabilities, different ethnicities, LGBTQI+, etc.), ensuring a balance across countries, tenure, seniority, and considering performance and cultural alignment.We drive our business purpose by democratizing opportunities, understanding, and respecting each uniqueness. Any violation of our MELI Code must be reported, and we maintain a confidential reporting line available 24/7 for anonymous reporting.AI-Driven Innovation at MercadoLibreAt MercadoLibre, we continuously seek to innovate in all our processes. We are currently exploring alternatives in AI to gain efficiency and scalability in our People processes, like using generative IT for employee services, such as our People Chat, which we are converting into a conversational chat formating using GenAI. This way, the interaction between the employee and the bot is much simpler, more natural, and fluid, which allows us to better detect intentions, accelerating response times and simplifying user management. We are also using AI for talent detection, candidate matching and content management, for example. We expect this will allow us to optimize our resources and enhance talent management, generating greater effectiveness in our operations. Additionally, we are committed to enriching the training and development experiences of our teams. By integrating AI solutions, we aim to offer more personalized and effective training programs that will enhance the professional growth of each member of our organization, thereby increasing the scalability of our training initiatives. We firmly believe that the combination of technology and a human-centered approach will enable us to adapt quickly to change and continue growing in an ever-evolving environment. Through these initiatives, we reaffirm our dedication to innovation and continuous learning at MercadoLibre. Furthermore, our goal is to train as many people as possible in the use of AI by 2025 to improve their efficiency, ensuring that our team is empowered to embrace the future. It is not clear how existing laws governing issues such as general commercial activities, property ownership, copyrights and other intellectual property issues, taxation, libel and defamation, obscenity, consumer protection, digital signatures and personal privacy apply to online businesses. Some of these laws were adopted before the Internet was available and, as a result, do not contemplate or address the unique issues of the Internet. These regulations could cover a wide variety of issues, including, without limitation, online commerce, Internet service providers’ responsibility for third party content hosted in their servers, user privacy, fintech transactions, freedom of expression, pricing, content and quality of products and services, taxation (including VAT or sales tax collection obligations, obligation to provide certain information about transactions that occurred through our platform, or about our users), advertising, intellectual property rights, consumer protection and information security.There are laws and regulations that address foreign currency and exchange rates in every country in which we operate. In certain countries where we operate, we need governmental authorization to pay invoices to a foreign supplier or send money abroad due to foreign exchange restrictions. See “Item 1A. Risk factors—Risks related to doing business in Latin America—Local currencies used in the conduct of our business are subject to depreciation, volatility and exchange controls” for more information.We are also subject to significant general data protection and privacy-related regulations in many of the jurisdictions in which we operate (e.g. Law No. 13,709 (“LGPD”) in Brazil, Law No. 1581/2012 and 1266/2008 in Colombia, Law No. 21.719 in Chile, Law No. 18,331 in Uruguay, Organic Law on Personal Data Protection in Ecuador, Law No. 29,733 in Peru, Personal Information Protection Law in China and some privacy and data protection state laws in the U.S.). Data protection laws establish rules for the collection, use, processing and storage of personal data and affect all economic sectors, including the relationship between customers and suppliers of goods and services, employees and employers and other relationships in which personal data is collected, whether in a digital or physical environment. We have created a program to implement the relevant requirements to our business processes, compliance infrastructures and IT systems to comply with data protection laws. Further, some jurisdictions in which we operate are considering imposing additional restrictions or regulations. 12,865/2013, which established the first set of rules regulating the electronic payments industry within the Brazilian Payment System (the Sistema de Pagamentos Brasileiro, or “SPB”) and created the concepts of payment schemes and payment institutions. 12 | MercadoLibre, Inc.Table of ContentsIn addition, Law No. 12,865/2013 gave the Brazilian Central Bank (“BACEN”), according to guidelines set out by the National Monetary Council (“CMN”) authority to regulate entities involved in the payments industry. A payment arrangement is a set of rules and procedures that regulate the provision of a certain payment service to the public accepted by more than one payee, through direct access by paying and receiving end users. There are two types of payment arrangements, as defined by Resolution 150/21: (i) “Closed Loop Payment Arrangement”: payment arrangements whereby the payment services (account management, issuance and accreditation of payment instrument) are performed by only one legal entity, which also acts as the payment arranger (or is controlled/the controller of the payment arranger) and (ii) “Open Loop Payment Arrangement”: any payment arrangements that do not fit into the concept of “Closed Loop Payment Arrangement”.Payment institutions are classified into (i) issuers of electronic currency, who manage a prepaid payment account, make available a payment transaction based on the electronic currency deposited in that account, convert such funds into physical or scriptural currency, or vice versa, can also enable its acceptance with settlement in a payment account it manages; (ii) issuers of post-paid payment instruments, who manage post-paid payment accounts that enable users to make payments on a post-paid basis; (iii) acquirer, who without managing payment accounts, enables payees for the acceptance of payment instruments issued by a payment or financial institution and participates in the settlement process of payment transactions as a creditor vis-à-vis the issuer, pursuant to the rules of the payment arrangement; and (iv) payment initiator, who initiates a payment upon a request of a client but it does not touch the money and does not keep passwords to execute payments on behalf of users.In November 2018, Mercado Pago obtained approval from the BACEN to become a payment institution in the modality of an issuer of electronic currency, pursuant to which Mercado Pago carries out payment processing functions and offers payment accounts to its customers.The funds held in a payment account: (i) constitute segregated assets in relation to the Mercado Pago’s assets; (ii) are not directly or indirectly available to settle any obligations of Mercado Pago; (iii) cannot be subject to attachment, sequestration, search and seizure on account of the Mercado Pago’s debts; (iv) are not part of Mercado Pago’s assets for bankruptcy or liquidation purposes; (v) cannot be given as guarantee for debts assumed by Mercado Pago; and (vi) are subject to the possibility of total redemption of the balance by the user at any time. These are very important concepts introduced by the law that ensures more reliability to customers of services provided by payment institutions, which offer payment accounts to its users.According to the BACEN’s regulation, Mercado Pago is required to maintain funds in an amount equal to the value of the balance of funds held in a payment account and in transit between payment accounts at the same payment institution in: (i) a specific account in the BACEN (Correspondent Account for Electronic Currency) or (ii) federal government bonds, registered at the Special Settlement and Custody System (“SELIC”).Mercado Pago is also a payment scheme owner of a closed-loop payment scheme, which is not part of the SPB and therefore does not require the BACEN’s authorization to operate as such, relating to peer-to-peer transfers between accounts opened by our users within the Mercado Pago payment account. Pursuant to the BACEN’s regulations, we are required to report certain operational information regarding this scheme to the BACEN on an annual basis, such as the number of users and the annual cash value of our peer-to-peer transfer transactions.In addition, Mercado Pago as a payment institution in Brazil is subject to:1.Anti-Money Laundering Rules: Mercado Pago is subject to Brazilian laws and regulations relating to anti-money laundering, terrorism financing and other potentially illegal activities. These rules require us to implement policies and internal procedures to manage, monitor, identify and, if applicable, report suspicious transactions to the relevant authorities to prevent the practice of crimes of “money laundering” or concealment of assets.2. These recent regulations aim to promote transparency in credit transactions, a broader credit offer and to allow merchants to offer their credit card receivables as collateral to receive better loan offers, improving competition and reducing the cost of credit.3.4.Data Protection Law: In August 2018, Brazil approved its first comprehensive data protection law, the LGPD, which became applicable to our business in Brazil in August 2020. 869/2018 which amended the LGPD and created Brazil’s national data protection authority (the “ANPDP”). We have created a program to implement the relevant changes to our business processes, compliance infrastructures and IT systems to reflect the new requirements and comply with the LGPD. The LGPD establishes detailed rules for the collection, use, processing and storage of personal data and affects all economic sectors, including the relationship between customers and suppliers of goods and services, employees and employers and other relationships in which personal data is collected, whether in a digital or physical environment.5. Internet activities in Brazil are regulated by Law No. 12,965/2014, known as the Brazilian Civil Rights Framework for the internet, which embodies a substantial set of rights of internet users and obligations relating to internet service providers, including data protection.Table of ContentsLaw No. 12,865/2013 prohibits payment institutions from performing activities that are restricted to financial institutions, such as granting loans directly. In November 2020, the BACEN approved the application filed by MercadoLibre, Inc. for authorization to incorporate a financial institution in the modality of credit, financing and investment corporation (“SCFI”). In light of the authorization granted by BACEN, we incorporated a new entity (Mercado Crédito Sociedade de Crédito, Financiamento e Investimento S.A.), which operates activities related to the granting of loans and obtains better funding alternatives for our business.On March 11, 2020, Mercado Pago also obtained approval from the BACEN to operate the activities of acquiring (payment processor) and post-paid payment instruments (credit cards) issuer, enabling the strengthening and growth of the Mercado Pago’s operations. However, according to regulation implemented by the BACEN, any payment institution that is already licensed in another modality may operate as acquirers, post-paid payment instrument issuers and/or payment transaction initiators, provided a 90-day prior notification is sent to the BACEN. Mercado Pago has participated in the payment scheme of Pix since its beginning and is subject to the applicable regulation. Mercado Pago Instituição de Pagamento Ltda. and Mercado Crédito Sociedade de Crédito, Financiamento e Investimento S.A. as regulated entities in Brazil are subject to the supervision of the BACEN and must fully comply with all the obligations established in the current regulation, or be subject to (i) formal warning establishing a deadline for the remediation of non-compliance activity, (ii) penalties for non-compliance, or (iii) shutting down our Mercado Pago business in Brazil for an indefinite period of time, which would be costly. The new rules required a gradual increase between 2023 and 2025 in the regulatory capital requirements applicable to our regulated Brazilian entities based on the following schedule: from July 2023 onwards, 6.75%, from January 2024 onwards, 8.75% and from January 2025 onwards, 10.50%.On May 23, 2023, the BACEN published Joint Resolution No. 6, providing requirements for financial institutions, payment institutions and other institutions authorized to operate by the BACEN with respect to the sharing of data and information pertaining to fraud. According to this regulation, the listed institutions must share certain information related to fraud and interoperate with centralized bureaus, which may be elected by the institutions. In October 2023, the BACEN published Resolution BCB nº 343, which details the information that must be shared, including information relating to fraud in account opening, account maintenance, provision of payment services and credit. These requirements became effective on November 1, 2023, and Mercado Pago is fully compliant, electing CERC as its centralized bureau.On January 2, 2024, article 28 of Law 14,690 came into force, which caps the total amount that may be charged to a credit card holder in the form of interest and financial charges at the value of the original debt. The BACEN also adopted rules in Resolution CMN N° 5,112 that provide guidance and define criteria for calculating the original value of the debt in card revolving and invoice financing operations. To comply with the new regulation, we reduced the duration of the credit card invoice financing plans beginning in January 2024.On June 28, 2024, Law No. 14,905 was enacted, modifying Decree No. 22,626, known as the "Lei da Usura". The law came into force on August 28, 2024, resulting in operations undertaken with institutions authorized by the BACEN, such as Mercado Pago Instituição de Pagamento Ltda., no longer being subject to the previously imposed interest rate cap.ArgentinaIn January 2020, the Central Bank of Argentina (“CBA”) enacted regulations relating to payments service providers that apply to the Fintech institutions that are not financial institutions but nevertheless, provide payment services in at least one of the stages of the payment system. The regulation sets forth certain specific rules related to (i) providing information to users; (ii) depositing users’ funds in a freely available bank account; (iii) allowing users to dispose immediately of the funds credited to their accounts; and (iv) providing information to the CBA relating to the business of payment processing. On July 7, 2020, MercadoLibre S.R.L. was registered with the CBA as a payment service provider in accordance with applicable regulations. We have been registered as a “Proveedor No Financiero de Crédito” (non-financial loan provider) with the CBA since December 18, 2020. The regulation also requires that we comply with certain rules established by the CBA regarding, among other things: (i) interest rates in loan operations; (ii) protection of users of financial services; (iii) methods of communication with users of financial services; and (iv) such users’ access to information concerning their contractual obligations. The rules regarding interest rates became effective on January 1, 2021, and the rules regarding the protection of users of financial services, methods of communication and access to information became effective on February 1, 2021. The regulation was already applicable to non-financial loan providers. On February 15, 2023, the CBA issued another regulation requiring PSPOCPs to comply with the Information Regime on Claims and the Information Regime on Transparency, Chapter II.Table of ContentsOn May 18, 2023 and May 30, 2023, the CBA enacted new regulations establishing that (i) QR codes must be interoperable with credit card payments, effective as from May 1, 2024; and (ii) digital wallets that allow credit card payments by reading QR codes must be interoperable, effective as from July 29, 2024. These regulations also expanded the payment services providers (“PSP”) registry and established that certain entities that accept, acquire, aggregate or sub-acquire payments must be registered. Under these regulations, MercadoLibre S.R.L. was registered as a Payment Aggregator in the "Registry of Payment Service Providers" of the CBA on June 24, 2024 and as a Payment Accepter in the "Registry of Payment Service Providers" of the CBA on April 10, 2024. Mercado Pago Servicios de Procesamiento S.R.L. was registered as an Acquirer in the "Registry of Payment Service Providers" of the CBA on February 23, 2024.On September 14, 2023, the CBA established that starting on December 1, 2023, DEBIN (debit immediate), the main and simple funding source of Mercado Pago users’ accounts, will be suspended and replaced with a pull transfer method that requires the consent of the client outside of Mercado Pago’s environment before the first use. After several extensions of the application of the rule, on April 30, 2024, the CBA approved a new method of pull transfer that no longer requires the consent of the client outside of Mercado Pago’s environment.On June 6, 2024, the CBA established that payment service providers who offer payment accounts (“PSPOCP” according to its Spanish acronym) are no longer required to distribute the returns generated by their clients' funds. However, financial institutions are still required to set up a reserve of 100% of the customer funds deposited by Mercado Pago and may invest up to 45% of those funds in Argentine bonds.In September 2021, MercadoLibre S.R.L. completed the registration process with the National Insurance Superintendent to operate as appointed agent for insurance companies (“agente institorio”), which allows MercadoLibre S.R.L. to offer its users insurance policies sold by one or more insurance companies, as well as to manage certain aspects of such policies (payments, claims, etc.).On June 4, 2024, Mercado Pago Inversiones S.R.L. was established. After its registration in the General Inspection of Justice on August 9, 2024, on September 2, 2024, this subsidiary requested a Comprehensive Settlement and Clearing Agent license from the Argentinian National Securities Commission, which was authorized on February 5, 2025. In addition, the subsidiary initiated the registration as a Comprehensive Investment Fund Placement and Distribution Agent (“ACDI”), which is still pending approval.On June 4, 2024, Mercado Pago Asset Management S.A. was established. After its registration in the General Inspection of Justice on August 5, 2024, on September 2, 2024, this subsidiary requested a Product Administration Agent of Collective Investment - Common Investment Funds license and requested the creation of a Money Market Mutual Fund ("Mercado Fondo Ahorro") from the Argentinian National Securities Commission. Both authorizations were granted on February 5, 2025. In addition, this subsidiary requested the replacement of INDUSTRIAL ASSET MANAGEMENT S.A. as Management Agent of “Mercado Fondo”, which is still pending approval.As of the date of this filing, the aforementioned subsidiaries have not yet begun their operations. Under the Fintech Law, institutions that provided the aforementioned services prior to its enactment are required to submit an application to the Comisión Nacional Bancaria y de Valores (the Mexican National Banking Commission or the “CNBV”) to obtain a license, and may continue to provide those services while such license application is being processed. On April 29, 2022, MercadoLibre, S.A. de C.V. Institución de Fondos de Pago Electrónico, a Mexican subsidiary, obtained the final approval by the CNBV to operate as an Electronic Payment Institution (Institución de Fondos de Pago Electrónico or “IFPE”, as referred to by the Financial Technology Institutions Act), which enables the entity to issue, manage, redeem and make electronic transfers of money on behalf of its clients, through computer applications, interfaces, web sites or any other means of electronic or digital communication. MercadoLibre, S.A. de C.V. Institución de Fondos de Pago Electrónico became a regulated financial entity towards third parties, effective on May 11, 2022 duly published in the Official Gazette, and is subject to the supervision and jurisdiction of the relevant Mexican financial regulators, including but not limited to the National Commission for the Protection and Defense of Users of Financial Services, CNBV and the Central Bank of Mexico. Amongst the regulatory obligations to which Electronic Payment Institutions are subject, the following are noteworthy: a) maintain minimum capital requirements, b) maintain sufficient reserves in high-quality liquid assets (e.g. cash, treasury bills, etc.), so as to be able to redeem, on par, the funds held on behalf of the clients, c) comply with anti-money laundering and countering of terrorism financing regulations, d) develop and maintain sound cybersecurity and information security policies, including but not limited to the performance of recurrent vulnerability tests and the deployment of strict infrastructure controls. Additionally, in February 2022, the National Insurance and Bond Commission granted Mercado Insurtech, Agente de Seguros, S.A. de C.V. definitive authorization to operate as an Insurance Agent.A.V., Institución de Fondos de Pago Electrónico submitted to the National Banking and Securities Commission ("CNVB") an authorization request to organize and operate as a multiple banking institution. As of the date of this filing, the aforementioned authorization is still pending approval.ChileIn 2017 and 2018, Chile enacted regulations regarding the issuance and operation of payment cards, which could affect Mercado Pago’s operations, including authorization to operate, anti-money laundering obligations, capital requirements and reserve funds, operational and security safeguards, among others. 15 | MercadoLibre, Inc.A.A. (formerly know as MercadoPago S.A.), a prepaid card issuer license and payment card operator license, respectively. These licenses transformed Mercado Pago Emisora S.A.A.A.); and (v) perform know your client and anti-money laundering duties.On October 12, 2022, the Chilean Congress approved the Fintech and Open-Banking Law Project, which was published on January 4, 2023, and came into effect on February 3, 2023. This law established a regulatory framework for certain technological financial services that did not have their own legal framework. These services are: (i) Alternative Transaction Systems, (ii) Crowdfunding Financing Platforms, (iii) Financial Instrument Intermediation, (iv) Order Routing, (v) Credit Advisory, and (vi) Investment Advisory. Pursuant to this law, in January 2025, Mercado Pago Crypto S.A. submitted the license application to the CMF within the legal deadline for its ruling, which is still pending approval. On April 8, 2024, the Chilean Congress published the Cybersecurity Law. Although Mercado Pago Chilean entities already comply with the law’s main obligations as a result of being regulated entities, pursuant to this new law, such entities will be subject to a new regulator and must comply with certain reporting requirements for cybersecurity incidents. We expect that the Mercado Pago Chilean entities will be required to comply with these new reporting requirements sometime during 2025 or 2026.On May 30, 2024, the Chilean Congress passed Law 21,673, amending Law 20,009, which, effective as of June 1, 2024, establishes a limited liability regime for users of prepaid cards in case of loss, theft, or fraud. Pursuant to Law 21,673, there may be instances in which an issuer may suspend a refund in the event of fraud or serious fault on behalf of the user claiming such refund on account of allegedly fraudulent charges. Mercado Pago Emisora S.A. completed the implementation of these measures for its compliance.In December 2024, Law No. 21,719 was approved by the National Congress of Chile to regulate the processing and protection of individuals' personal data. The law establishes the creation of a Data Protection Agency, which will serve as a technical and autonomous entity responsible for supervising and ensuring the data protection rights of individuals in Chile. This agency will have various powers, including the authority to oversee and sanction data controllers who do not comply with the regulations. The modifications will enter into force 24 months after their publication, while the necessary regulations must be issued within a period of six months. The main objective of the Company is the remunerated intermediation of general and life insurance contracts with any insurer based in Chile.ColombiaColombian regulations establish specific requirements to open accounts and provide certain financial services, as well as policies for cash and risk management. There are also regulations requiring payment processors such as Mercado Pago to comply with certain security, privacy and anti-money laundering standards. In June 2023, MercadoPago S.A. As a financial company it is subject to minimum capital, reporting, consumer protection and risk management requirements.A. Compañía de Financiamiento started operations initially offering only the “Ordinary Deposit” product. In accordance with regulations, customers' funds are now subject to regulatory liquidity, reserve, and solvency requirements to ensure their protection.UruguayUruguay has implemented comprehensive regulations governing electronic payments.com de Uruguay S.R.L. Thus, on November 1, 2016, Mercado Pago was launched in Uruguay. In July 2023, MercadoPago Uruguay S.R.L. obtained the approval by the BCU to operate as an Electronic Money Issuing Institution (“IEDE”). On October 1, 2023, MercadoPago Uruguay S.R.L. started operations, and since then, must adhere to regulations regarding the placement of user funds, including the obligation to deposit and maintain these funds in designated local bank accounts to guarantee the availability of balances in each user’s digital account. In October 2023, MercadoPago Uruguay S.R.L. was authorized by the BCU, subject to the terms of the regulations, to invest its user funds in short-term investments, including “overnight” bank deposits, leveraging results and assuming associated risks.In July 2023, Communication No. 2023/147, superseded by Communication No. 2024/018 on February 1, 2024, established regulations for reporting security incidents. In October 2023, Communication No. 2023/196 mandated bi-monthly reports on administered fund compositions, and significant modifications addressing fast payment systems and regulatory rules were made to the payment system rules.On April 12, 2024, MercadoPago Uruguay S.R.L. initiated a process with the BCU to be authorized to act as a payment acquirer with transfers, as an activity related to electronic money issuances, in compliance with new regulations that came into effect on March 1, 2024.R.L. received authorization from the BCU to offer payment with transfers acquiring services.Table of ContentsOn April 17, 2024, MercadoPago Uruguay S.R.L. was approved as a participant in the automated clearing house managed by Urutec S.A. This approval allows MercadoPago Uruguay S.R.L. to participate in the fast payment system and offer a new payment method to its users: interoperable QR transfer payments. In September 2024, the BCU announced that they approved the release of the interoperable QR transfer payment feature of the payment system. On January 27, 2023, MercadoPago Perú S.R.L. On February 20, 2024, the Register of Entities with Payments by Card agreement form was completed, in accordance with BCRP requirements. RISK FACTORSSummary of Risk FactorsOur business is subject to numerous risks.Table of Contents■Natural disasters, climate change, geopolitical events, global health epidemics or pandemics, transportation disruptions and catastrophic events could materially adversely affect our financial performance;■We are subject to extensive government regulation and oversight. Failure to comply with existing and future rules and regulations in the jurisdictions in which we operate could adversely affect the operations of one or more of our businesses in those jurisdictions;■It may be difficult to enforce judgments rendered against us in U.S.Set forth below is a full description of each of the risks that we believe are material to our stockholders and prospective stockholders. You should carefully consider the following factors in evaluating our Company, our properties and our business. A significant portion of our business is based on an Internet platform for commercial and financial transactions in which almost all activity depends on our users and is therefore largely outside of our control. Except for our first-party sales, we do not choose which items will be listed, nor do we make pricing or other decisions relating to the products and services bought and sold on our platform. Our future revenues depend substantially on Latin American consumers’ and providers’ widespread acceptance and continued use of the Internet as a way to conduct commerce and to carry out specific financial transactions. For us to grow our user base successfully, more consumers and providers must accept and use new ways of conducting business and exchanging information. The price of personal computers and/or mobile devices and Internet access may limit our potential growth in certain areas or countries with low levels of Internet penetration and/or high levels of poverty. The infrastructure for the Internet in Latin America may not be able to support continued growth in the number of Internet users, their frequency of use or their bandwidth requirements. Availability, transaction speeds, acceptance, interest and use of the Internet across Latin America are all critical to our growth and services, and the occurrence of any one or more of the above challenges to Internet usage could have a material adverse effect on our business.Table of ContentsWe operate in a highly competitive and evolving environmentThe e-commerce and omnichannel retail, e-commerce services, fintech and digital content and electronic devices industries are still relatively new in Latin America, rapidly evolving, highly innovative and intensely competitive, and we expect competition to become more intense in the future.g. These competitive advantages could be used to harm our competitive position through the adoption of restrictive covenants with suppliers, self-preferencing their product offerings, tying and bundling services and cross subsidizing. Competing services tied to established banks and other financial institutions may offer greater liquidity and create greater consumer confidence in the safety and efficacy of our competitors' services. Established banks and other financial institutions currently offer online payments, and those that do not yet provide such a service could quickly and easily develop it.In many cases, companies that directly or indirectly compete with us provide Internet access. Similarly, some of our competitors have been accused, in other jurisdictions, of anticompetitive business practices, which they can replicate in Latin American countries where antitrust authorities have not yet focused on such commercial practices and where we actively compete.The global financial services and payments industry is continuously changing and increasingly subject to regulatory supervision and continued examination. Some of the payment services offered by our competitors operate at lower commission rates than Mercado Pago’s current rates, which has resulted in market pressures with respect to the commissions we charge for our Mercado Pago services. Moreover, establishing a financial services and payments solution entity in Latin America has proven to be difficult and resource intensive in terms of time and capital. Traditional banking and financial institutions in Latin America still have significant influence over sectoral regulators and have been relatively successful at influencing the enactment of new regulations that may hinder or restrict the overall success of fintech businesses by imposing unnecessary and cumbersome requirements or otherwise limiting their business models. This influence makes it harder to promote innovative payment solutions and policy changes to adapt regulation to an ever changing and fast growing innovative and disrupting industry. 20 | MercadoLibre, Inc.Table of ContentsWe are expanding our investment in AI across the entire Company. This includes using generative AI and continuing to integrate AI capabilities into our products and services. While AI/ML can present significant benefits, it can also present risks and challenges to our business. Data sourcing, technology integration, bias in decision-making algorithms, security challenges and the protection of personal privacy could slow down or impair the adoption and acceptance of AI/ML. AI technology and services are highly competitive, rapidly evolving, and require significant investment, including development and operational costs, to meet the changing needs and expectations of our existing users and attract new users. Our ability to deploy and leverage certain AI technologies critical for our products and services and for our business strategy, and to enhance productivity across the organization, may depend on the availability and pricing of third-party equipment and technical infrastructure. Additionally, other companies may develop AI products and technologies that are similar or superior to our technologies or more cost-effective to deploy. Other companies may also have (or in the future may obtain) patents, copyrights or other proprietary rights that could prevent, limit, or interfere with our ability to make, use, or sell our own AI products and services. We may not be able to compete effectively with our competitors and our strategy to integrate AI/ML technology into our products and services may also not be accepted by our customers or by other businesses in the marketplace. If the output from AI/ML in our products or services is deemed to be inaccurate or questionable, or if the use of AI/ML does not operate as anticipated or perform as promised, our business and reputation may be harmed. The integration of AI/ML may also expose us to risks regarding intellectual property ownership and license rights, particularly if any copyrighted material is embedded in training models.We rely on third-party platforms, such as Google Play and Apple app stores, to access our Mercado Libre and Mercado Pago appsOur Mercado Libre and Mercado Pago apps are accessed through third-party platforms, such as Google and Apple’s app stores. We are subject to the standard terms and conditions that these providers have for application developers, which govern the content, promotion, distribution, and operation of apps on their platforms or marketplaces, and which the providers can change unilaterally on short or no notice. Those terms and conditions include limitations on the sale of digital goods and services (e.g. These limitations may prevent the deployment of initiatives for mobile apps, thereby limiting the range of their overall impact.Our future success depends on our ability to expand and adapt our operations to meet rapidly changing industry and technology standards in a cost-effective and timely mannerRapid, significant and disruptive technological changes impact the industries in which we operate. Moreover, the effects of technological changes on our business are uncertain. We are also increasingly leveraging AI technologies, including generative AI, in our products and services and are making investments to expand our use of generative AI capabilities. If we are unable to do so in a timely or cost-effective manner, our business could be harmed.We plan to continue to expand our operations by expanding our services internationally and developing and promoting new and complementary services. We may have limited or no experience in our newer market segments, which can present new and difficult technology challenges. We may not succeed at expanding our operations in a cost-effective or timely manner, and our expansion efforts may not have the same or greater overall market acceptance as our current services, which could damage our reputation and diminish the value of our brands. Similarly, a lack of market acceptance of these services or our inability to generate satisfactory revenues from any expanded services to offset their cost could have a material adverse effect on our business, results of operations and financial condition.We must constantly add new hardware, update software, enhance and improve our billing and transaction systems, and add and train new engineering and other personnel to accommodate the increased use of our website, apps and the new products and features we regularly introduce. Our revenues depend on prompt and accurate billing processes. Failure to upgrade our technology, transaction-processing capabilities, features, transaction processing systems, security infrastructure, or network infrastructure to accommodate increased traffic or transaction volume, or the increased complexity of our website could materially harm our business and our ability to collect revenue. In addition, our use of AI involves significant technical complexity and requires specialized expertise. Any disruption or failure in our AI systems or infrastructure, or those of our third-party providers, could result in system failures, delays or errors in our operations, which could harm our business and financial results.We may also need to enter into relationships with various strategic partners, websites, other online service providers, shipping companies and other third parties necessary to our business. The increased complexity of managing multiple commercial relationships could lead to execution problems that can affect current and future revenues and operating margins, as well as our reputation. The expansion of our Mercado Pago and Mercado Envios businesses into new countries may also require a close commercial relationship with one or more local banks or other intermediaries, which may prevent, delay or limit the introductions of our services in such countries. If our users have negative experiences with, or view unfavorably, any of the companies or partners with whom we have relationships, it could cause them to stop using our products and services and negatively impact our results of operations. Our current and future expense levels are based largely on our investment plans and estimates of future revenues and are, to a large extent, fixed. We may not be able to adjust spending in a timely manner to compensate for any unexpected revenue shortfall. We have received in the past, and anticipate that we will receive in the future, complaints from users who did not receive the purchase price or the goods agreed to be exchanged, and regarding the quality or the partial or non-delivery of purchased items. While we can suspend the accounts of users who fail to fulfill their obligations to other users, we do not have the ability to force users to meet their obligations. Our Buyer Protection Program, which is generally available to all of our buyers, has been implemented to address those situations, subject to certain conditions. As we expand the coverage of our Buyer Protection Program, the number and amount of reimbursements may increase. Effective customer service requires significant personnel expense and investment in developing programs and technology infrastructure to help customer service representatives carry out their functions, which if not properly managed, could significantly impact our profitability.In addition, failure to handle customer complaints effectively and negative publicity generated as a result of the fraudulent or deceptive conduct of any of our sellers could damage our reputation, diminish the value of our brands and negatively impact our results of operations.Fraudulent activity by our users could negatively impact our operating results, brand and reputation and cause the use of services to decreaseWe are subject to the risk of fraudulent activity by our users, including fraudulent and illicit sales, money laundering, bank fraud, fraud from means of payment entities, employee fraud, third parties providers' fraud and online securities fraud. Measures to detect and reduce the occurrence of fraudulent activities are complex and require continuous improvement, and there can be no assurance that they will be sufficient to accurately detect, prevent or deter fraud, particularly new and continually evolving forms of fraud. Third parties have attempted, and will likely continue to attempt, to abuse access to and misuse our payments solution to commit fraud by, among other things, creating fictitious accounts using stolen or synthetic identities or personal information, making transactions with stolen financial instruments, abusing or misusing our services for financial gain or fraudulently inducing users of our platforms into engaging in fraudulent transactions. Due to the digital nature of our payments services, third parties may perform abusive schemes or fraud attacks that are often difficult to detect and may reach a scale that would otherwise not be possible in physical transactions. Numerous and evolving fraud schemes and misuse of our payments service could subject us to significant costs and liabilities, require us to change our business practices, lead to loss of customer confidence in, or decreased use of, our products and services, damage our reputation and brands, and divert the attention of management from the operation of our business. In addition to the direct costs of such losses, if the losses are related to credit card transactions and become excessive, they could result in Mercado Pago losing the right to accept credit cards for payment, which could adversely affect our business. A decline in the demand for or popularity of certain items sold through the Mercado Libre Marketplace without an increase in demand for different items could result in reduced revenues.Our ability to predict and adapt to changing tastes and preferences depends on many factors, including, but not limited to, obtaining accurate and relevant data on customer preferences, emphasizing relevant merchandise categories, effectively managing our inventory levels, and implementing competitive and effective pricing and promotion strategies.Table of ContentsManufacturers may limit distribution of their products by distributors, prevent distributors from selling through us or encourage governments to limit e-commerceManufacturers may attempt to enforce minimum resale price maintenance arrangements to prevent distributors from selling on our websites or on the internet generally, or at prices that would make our site unattractive relative to other alternatives. Increased competition or anti-Internet distribution policies could result in reduced operating margins, loss of market share and diminished value of our brand. In order to respond to changes in the competitive environment, we may, from time to time, make pricing, service or marketing decisions or acquisitions that may be controversial with and lead to dissatisfaction among some of our sellers, which could reduce activity on our websites and harm our profitability. As Mercado Pago continues to grow, we must strengthen our internal controls accordingly. Mercado Pago’s success requires significant consumer confidence in our ability to handle large and growing transaction volumes and amounts of customer funds. Any failure to maintain necessary controls or to properly manage customer funds could severely reduce customer use of Mercado Pago, and we could be found to be in violation of applicable laws and regulations, be subject to fines or other penalties or forced to cease providing this service. The scope of Mercado Pago’s involvement in these services is strictly limited to (i) the processing of charges and payments from users that use their balances held with Mercado Pago to invest, and (ii) sending the appropriate instructions to our investment partners. The third party providers have complete decision-making authority over the funds and their investment strategies. A disruption in our relationships with such third party providers or any of the services they provide to our users could adversely affect our customers’ confidence in our business. If there is a disruption in the services provided by our third party providers or the investments made by our users otherwise decrease in value, our users may try to pursue claims or legal actions against us, which could affect our reputation and results of operations.We rely on banks and investment funds that acquire Mercado Pago’s receivables and payment processors to fund transactions, and changes to card association fees, rules or practices may adversely affect our businessMercado Pago relies on banks, investment funds or payment processors to process the funding of Mercado Pago transactions and Mercado Libre Marketplace collections, and we must pay a fee for this service. From time to time, card associations may increase the interchange fees they charge for each transaction using one of their cards. Card processors have the right to pass on to us any increases in interchange fees or their own fees for processing. These increased fees increase the operating costs of Mercado Pago, reduce our profit margins from Mercado Pago operations and, to a lesser degree, affect the operating margins of the Mercado Libre Marketplace. If any of these companies were to be unwilling or unable to provide these services to us, or if they are willing to provide these services but at less favorable terms, our business and results of operations would be adversely affected.We are also subject to, or required by processors to comply with, card association operating rules. The card associations and their member banks set and interpret the card rules. Some of those member banks compete with Mercado Pago. Card companies could adopt new operating rules or re-interpret existing rules that we or Mercado Pago’s processors may find difficult or even impossible to follow. As a result, we could lose our ability to provide Mercado Pago customers the option of using debit, prepaid or credit cards to fund their payments and MercadoLibre users the option to pay their fees using a debit, prepaid or credit card, which could be materially adverse to our business.We could lose the right to accept credit cards or pay fines if card processors determine that users are using Mercado Pago to engage in illegal or “high risk” activities or if users generate a large amount of chargebacks. Accordingly, we are continually working to prevent “high risk” merchants from using Mercado Pago. Additionally, we may be unable to access financing in the credit and capital markets at reasonable rates to fund our Mercado Pago operations, and for that reason, our profitability and total payments volume could materially decline.Table of Contents■We may be unable to access financing in the credit and capital markets at reasonable rates. Due to the nature of our Mercado Pago and Mercado Libre Marketplace businesses, we generate high credit card receivables and consumer and merchant loans that from time to time we sell to financial institutions, and accordingly, lack of access to credit or significant changes to the terms of any existing credit, or bank liquidations could cause us to experience severe difficulties; and■The failure of financial institution counterparties to honor their obligations to us under credit instruments could jeopardize our ability to rely on and benefit from those instruments. Our ability to replace those instruments on the same or similar terms may be limited under difficult market conditions.3%, respectively, of Mercado Pago’s total payment volume. To subsidize the cost of the installment payment feature, from time to time we pay interest to discount credit card receivables, securitize credit card receivables through trusts or finance Mercado Pago business through financial debt. In all of these cases, if interest rates increase, we may have to raise the installment fees we charge to users that would likely have a negative effect on Mercado Pago’s total payment volume.Changes in Mercado Pago’s funding mix and ticket mix could adversely affect Mercado Pago’s resultsMercado Pago pays significant transaction fees when customers fund payment transactions using certain debit and credit cards or through unaffiliated entities, nominal fees when customers fund payment transactions from their bank accounts, and no fees when customers fund payment transactions from an existing Mercado Pago account balance. Currently, Mercado Pago, if applicable, charges a fee calculated as a percentage of each transaction. If Mercado Pago receives a larger percentage of low ticket transactions, our profit margin may erode, or we may need to raise prices, which, in turn, may affect the volume of transactions.Our lending solution exposes us to the credit risk of our merchants and consumers, among other risksOur lending solution is offered to certain merchants and consumers, and the financial success of this product depends on the effective management of the credit-related risk. We assess the credit risk of merchants and/or consumers seeking a loan based on an internally-developed risk model which, among other factors, may not accurately predict their creditworthiness due to inaccurate assumptions about the particular merchant and/or consumer or the economic environment or limited product history, among other aspects. The accuracy of the risk model and our ability to manage credit risk may also be affected by legal or regulatory changes (e.g. A decline in economic, political, market, health and social conditions could impact our users as well, and their decisions could reduce the number of cards, accounts, and credit lines of their account holders, which ultimately impact our revenues. Any events or conditions that impair the functioning of the financial markets, tighten the credit market, or lead to a downgrade of our current credit rating could increase our future borrowing costs and impair our ability to access the capital and credit markets on favorable terms, which could affect our liquidity and capital resources, or significantly increase our cost of capital. Any of these events could adversely affect our business and results of operation. We generally pay local carriers directly for their shipping costs, and then we decide how much of those costs we transfer to our customers.We rely on a number of local carriers (through non-exclusivity agreements) to receive the inventories for our first-party business and on third parties to ship orders to customers. The unavailability of the services of local carriers in certain regions with high demand could negatively affect our ability to provide shipping services to our customers, which could in turn have a material adverse effect on our shipping service, operating results, and financial condition.Table of ContentsFailure to successfully operate our fulfillment network may also negatively affect our businessThrough our logistics solution, Mercado Envios, we offer sellers on our platform fulfillment and warehousing services, including maintaining inventories of third parties that sell products through our platform. We also use fulfillment and warehousing services for our first-party business.We offer to sellers our Fulfillment Protection Program for any damage or loss of seller’s inventories as a result of using our fulfillment network service, subject to certain conditions.Problems that affect our service providers could potentially adversely affect us as wellA number of parties provide services to us or to our users. These services include the hosting of our servers, shipping and the postal and payments infrastructures that allow users to deliver and pay for goods and services, in addition to paying their Mercado Libre Marketplace bills. Financial, regulatory, or other problems that might prevent these companies from providing services to us or our users could reduce the number of listings on our websites or make completing transactions on our ecosystem more difficult, which may harm our business. Any security breach at one of these companies could also affect our customers and harm our business. If we are unable to compete effectively for advertising spend, or if merchants reduce advertising spend due to adverse macroeconomic conditions or for other reasons, our business and results of operations could be materially harmed. Failing to provide superior value or deliver advertisements effectively and competitively could harm our reputation, financial condition and operating results.We may not realize benefits from recent or future strategic investments, acquisitions of businesses, technologies, services or products, despite their capital outlay and potential dilution to our stockholdersWe intend to continue to enter into a wide array of potential strategic transactions, including strategic investments, acquiring businesses, technologies, services or products, as appropriate opportunities arise. We may not, however, be able to identify, negotiate or finance such future acquisitions successfully or at favorable valuations, or to effectively integrate these acquisitions with our current business. Strategic transactions may involve significant additional challenges, uncertainties and risks, including, but not limited to, unforeseen operating difficulties and expenditures, challenges of integrating new employees, systems, technologies, and business cultures; failure to develop the acquired business adequately; disruption of our ongoing operations and diversion of our management’s attention; inadequate data security, cybersecurity and operational and information technology resilience; failure to identify, or our underestimation of, commitments, liabilities, deficiencies and other risks associated with acquired businesses or assets; and potential exposure to new or increased regulatory oversight and uncertain or evolving legal, regulatory and compliance requirements; potential reputational risks that could arise from transactions with, or investments in, companies involved in new or developing businesses or industries, which may be subject to uncertain or evolving legal, regulatory and compliance requirements; failure of the transaction to advance our business strategy and of its anticipated benefits to materialize; potential impairment of goodwill or other acquisition-related intangible assets; and the potential for our acquisitions to result in dilutive issuances of our equity securities or significant additional debt. Strategic transactions may also heighten many of the risks described in this “Risk Factors” section.Acquisitions could result in potentially dilutive issuances of equity securities, the incurrence of debt, contingent liabilities and/or amortization expenses related to intangible assets and impairment of goodwill, which could materially adversely affect our business, results of operations and financial condition. Any future acquisitions might require us to obtain additional equity or debt financing, which might not be available on favorable terms, or at all. If debt financing for potential future acquisitions is unavailable, we may determine to issue shares of our common stock or preferred stock in connection with such an acquisition, and any such issuance could result in the dilution of our common stock.Table of ContentsWe depend on key personnel, the loss of which could have a material adverse effect on usOur performance depends substantially on the continued services and on the performance of our senior management and other key personnel. Our ability to retain and motivate these and other officers and employees, as well as our ability to successfully transition key roles, is fundamental to our performance.Our future success also depends on our ability to identify, attract, hire, train, retain and motivate other highly skilled technical, managerial, marketing and customer service personnel. Competition for these personnel is intense, and we cannot assure you that we will be able to successfully attract and retain sufficiently qualified personnel. In addition, changes we make to our current and future work environments may not meet the needs or expectations of our employees or may be perceived as less favorable compared to other companies, which could adversely affect our ability to attract and retain qualified personnel. Failure to successfully hire, train, manage, and retain sufficient and qualified personnel to meet our needs, as well as successfully transition key roles can be inherently difficult to manage, strain our operations, increase payroll and other costs, and harm our business and reputation.We may have inadequate business insurance coverage, which would require us to spend significant resources in the event of a disruption of our services or other contingencyEven though we have business insurance coverage to face major contingencies affecting our services and goods, it may be inadequate to compensate for our losses, its coverage may be limited, or the amount of our insurance may be less than the related loss. Any business disruption, litigation, system failure or natural or man-made disaster may cause us to incur substantial costs and divert resources, which could have a material adverse effect on our business, results of operation and financial condition.Our debt instruments contain restrictions that limit our flexibility in operating our business, and changes by any rating agency to our outlook or credit rating could negatively affect usThe terms of our senior unsecured notes issued in January 2021 and certain collateralized debt under securitization transactions contain, and any debt instruments we enter in the future may contain, covenants that restrict or could restrict, among other things, our business and operations. Moreover, any such acceleration and required repayment of, or default in respect of, any of our indebtedness could, in turn, constitute an event of default under other debt instruments, thereby resulting in the acceleration and required repayment of other indebtedness we may have. Any of these events could materially adversely affect our liquidity and financial condition.In addition, changes by any rating agency to our outlook or credit rating could negatively affect the value of both our debt and equity securities and increase our borrowing costs. In addition, any downgrades to our credit ratings may affect our ability to obtain additional financing in the future and the terms of any such financing. Any of these factors could adversely affect our financial condition and results of operations.We hold and may acquire digital assets that may be subject to volatile market prices and unique risks of lossWe have used a portion of our cash reserve to purchase digital assets or certain other alternative reserve assets and we may continue acquiring and holding digital assets from time to time in the future. For example, the prevalence of such assets is a relatively recent development, and their long-term adoption by investors, consumers and businesses is unpredictable. The status of such assets for a variety of regulatory purposes is unclear and may change in the future. The rapidly evolving regulatory landscape with respect to digital assets may subject us to additional costs, such as the implementation of additional and potentially costly controls or other actions.Table of ContentsIncreasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices may impose additional costs on us or expose us to new or additional risksWe publish an annual integrated impact report, that describes, among others, our policies, practices and initiatives across a variety of environmental, social and governance (“ESG”) matters, including our contribution to socio-economic development, inclusion and financial education, human capital management and efforts to reduce our environmental impact. For example, some of our Marketplace customers may elect to reduce purchases from us if we are unable to verify that our performance and products meet the specifications of responsible sourcing programs. Investor advocacy groups, investment funds and institutional investors are also increasingly focused on these practices, especially as they relate to the environment, health and safety, diversity, labor conditions and human rights. In addition, there can be no assurance that our current policies, practices, reporting frameworks and principles will be in compliance with any new environmental and social laws and regulations that may be promulgated in the U.S. and other jurisdictions. New government regulations could also result in new or more stringent forms of ESG oversight and expanding mandatory and voluntary reporting, taxes, diligence and disclosure. The costs of changing any of our current practices to comply with any new legal and regulatory requirements in the U.S. and other jurisdictions may be substantial. Furthermore, industry and market practices may further develop to become even more robust than what is required under any new laws and regulations, and we may have to expend significant efforts and resources to keep up with market trends and stay competitive among our peers. Increased ESG related compliance costs for us as well as among Marketplace merchants and vendors and various other parties within our supply chain could result in increases to our overall operational costs. Failure or perceived failure to adapt to achieve our goals or commitments, or comply with regulatory requirements or investor or stakeholder expectations and standards could negatively impact our reputation, ability to do business with certain partners and our stock price. Government, media or activist pressure to limit emissions could negatively impact consumers’ perceptions of our products and services, which could have a material adverse effect on our business, and the actions taken by governments and other actors to reduce emissions could impose costs that could materially affect our financial condition. Such uncertainty could also subject us to regulatory actions or claims. Despite our disclaimer of liability for any loss, damage, claim, cost and/or expense that may arise in connection with the loyalty program, users may also try to pursue claims against us if the loyalty program is unsuccessful or the tokens otherwise decrease in value. For both our token loyalty program and our buy, hold and sell Mercado Pago feature, we rely on third party service providers to perform several functions in connection therewith. Such service providers (“SPs”) provide our customers token and crypto-assets exchange services (whereby customers can buy and sell tokens and certain crypto-assets) as well as tokens and crypto-assets custody services. The SPs are also responsible for securing our customers’ tokens and crypto-assets and protecting them from loss or theft. We, in turn, provide a platform that acts as an interface for our customers to access the SPs’ services. Our SPs rely on computer software, hardware and telecommunications infrastructure and networking to provide services to our customers related to the token and crypto-assets exchange and custody services. These computer-based services are subject to disruption, delay and/or failure, which could cause our users to lose access to our Mercado Pago platform or to the SPs’ services.In addition, the SPs maintain the cryptographic private keys that allow access to the digital accounts where our customers’ tokens and crypto-assets are held in custody. While we have taken steps to make our program and these offerings secure, tokens and digital assets in the custody of various other custodians have in the past been hacked or lost. 27 | MercadoLibre, Inc.Table of ContentsThe market perception and regulatory environment concerning digital assets, including cryptocurrencies and stablecoins, are uncertain and evolving. Jurisdictions where we operate may enact legislation subjecting us to additional money transmitter or other regulations in connection with our token loyalty program and crypto-assets exchange services or may require us to obtain licenses or regulatory authorizations in connection with these activities.Natural disasters, climate change, geopolitical events, global health epidemics or pandemics, transportation disruptions and catastrophic events could materially adversely affect our financial performanceThe occurrence of one or more natural disasters, such as hurricanes, tropical storms, floods, fires, earthquakes, tsunamis, cyclones, typhoons; weather conditions such as major or extended winter storms, droughts and tornadoes, whether as a result of climate change or otherwise; geopolitical events (such as international trade disputes and the ongoing conflicts in Ukraine and the Middle East; global health epidemics or pandemics or other contagious outbreaks (such as COVID-19 and its variants); transportation disruptions that affect transportation and warehousing providers (for instance, labor disputes and work stoppages); and catastrophic events, such as war, civil unrest, terrorist attacks or other acts of violence, including active shooter situations, acts of vandalism or terrorism, labor or trade disputes, and similar events in countries in which we operate, in which our users are located, or in other areas of the world could adversely affect our operations and financial performance.Such events could result (whether directly or indirectly) in physical damage to, or the complete loss of, one or more of our facilities, loss or spoilage of inventory, limits on our ability to receive the inventories of third parties efficiently and ship orders to customers, business interruption, the lack of an adequate work force in a market, the unavailability of our platforms to our users, changes in the purchasing patterns of consumers and in consumers’ disposable income, the temporary or long-term supply chain and logistics disruption, the disruption of critical infrastructure and communication systems, banking systems, utility services or energy availability.Furthermore, the long-term impacts of climate change, whether involving physical risks (such as extreme weather conditions, drought, or rising sea levels) or transition risks (such as regulatory or technology changes) are expected to be widespread and unpredictable. Physical risk may result in: disruption of operations and distribution, as well as higher costs, due to increased frequency and intensity of severe storms, wildfires, high-speed wind, flooding, sea level rise, drought precipitation and rising mean temperatures; increased insurance premiums due to increased exposure to physical weather perils; and increased heat stress to our workforce and increased costs throughout operations, supply chain and distribution due to greater cooling needs. These events and their impacts could materially adversely affect our business.Legal and Regulatory RisksWe are subject to extensive government regulation and oversight. Further, because our services and products are available in a number of countries, certain foreign jurisdictions may claim that we are required to comply with their laws. The expansion of our business may also result in increased regulatory oversight and enforcement, as well as licensing requirements.S. Foreign Corrupt Practices Act (“FCPA”) and other applicable U.S. and other local laws prohibiting corrupt payments to government officials and other third parties. To fulfill our commitment to the applicable regulations in a sustainable and effective manner and to prevent and control anyone in our ecosystem from making or offering improper payments or anything of value that could be perceived as a bribe, or that is intended to obtain an improper benefit or preferential treatment for us, we have an Anti Corruption Policy and a risk-based Anti-Corruption Program designed to prevent, detect and remedy acts of corruption. We have been and we expect that we will continue to be involved in disputes or regulatory inquiries that arise in the ordinary course of business, the number and significance of which has increased as our business has expanded. The media, political and regulatory scrutiny that we may face could increase or amplify these risks.g. in relation to risk analysis) governing anti-money laundering, taxation, reporting obligations, consumer protection and businesses. This uncertainty could negatively affect our users’ perception and use of our services, and could result in significant expense should we have to defend cases in an unclear legal environment. This includes emerging challenges posed by new and evolving technologies such as cloud computing, AI and ML, and blockchain, which introduce novel methods for processing and analyzing data. In addition, the adoption and use of AI and ML introduces compliance challenges by potentially exposing us to situations where our customers’ personal data is inferred, reprocessed, or repurposed in ways that may not aligned with regulatory expectations. Such challenges could negatively impact our operations, financial performance, and stakeholder trust. These complaints are small as a percentage of our total transactions, but they could become large in aggregate (absolute) numbers over time. In addition, the Organization for Economic Co-operation and Development reached agreement among various countries to implement a minimum 15% effective tax rate on certain multinational enterprises, commonly referred to as Pillar Two. Certain countries in which we operate are actively considering adopting parts of the Pillar Two framework. The governments of Spain and Brazil passed laws adopting the framework in December 2024. See "Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of operations - Income tax" for further information. We are continuing to evaluate the impact of these proposed legislative changes as new guidance becomes available. Legislative changes could impact our effective tax rate and tax liabilities.In addition, Brazil is currently undergoing a tax reform to replace several local taxes with a dual VAT system. The new system will become effective in 2026 and will face a transitional period until 2033, with the progressive charging of the new taxes and the extinction of the ones currently in place, as well as the implementation of the split payment system. Furthermore, we have a complex corporate structure, with entities that are subject to taxation in multiple jurisdictions, and the management of that structure and the transactions among our entities creates potential tax exposures for us in multiple jurisdictions, including the U.S. as well as the jurisdictions where our subsidiaries operate. CompetitionWe may be subject to private claims, lawsuits, regulatory and government investigations, other proceedings and orders involving allegations that our actions may violate antitrust or competition laws, or otherwise constitute unfair competition. For instance, on February 13, 2024, the Mexican antitrust authority (Comisión Federal de Competencia Económica or “COFECE”) notified MercadoLibre, S.A.V., Institución de Fondos de Pago Electrónico of its preliminary findings, conclusions and recommendations regarding competition in the e-commerce sector in Mexico, including proposed corrective measures on marketplace operators that include Mercado Libre and that, if confirmed, could require us to change certain aspects of some of our business practices in Mexico, including obligations to interoperate with independent logistics companies, which may affect the overall functioning of our logistics service. This preliminary report is the result of a general market study on barriers to competition in the e-commerce market, launched by COFECE in 2022 and will now be taken to a subsequent stage of the process where MercadoLibre, S.A.V., Institución de Fondos de Pago Electrónico and other affected entities may submit their views and additional evidence. The preliminary report and additional submissions will be analyzed by COFECE’s full board of commissioners, in accordance with applicable laws and procedures, and the plenary will issue a final report that is expected to be issued the first half of 2025. The final report may be subject to a special constitutional appeal before a specialized Mexican court, and subsequent judicial decisions may be further appealed and may reach the Mexican Supreme Court. This additional judicial stage may take several years until a final decision is reached. The outcome of these proceedings and the impact that any final corrective measures may have on certain aspects of some of our business practices, is uncertain. We cannot assure you that they will not adversely affect our business, operation results and/or financial conditions.Private claims have been brought against us, and this may continue to occur in the future, for potential breaches of antitrust or competition law and/or unfair competition. We are subject to regulation in Brazil, Argentina, Mexico, Chile, Peru, Colombia and Uruguay, that require or would require us to obtain licenses or regulatory authorizations to operate certain services provided by Mercado Pago and that would subject us to additional regulatory requirements. Any of these changes could result in making the service less attractive to users, decreasing the speed of trade on the Mercado Libre Marketplace, increasing our financial costs or change our financial model, which would further harm our business and results of operations.Anti-Money LaunderingWe are subject to anti-money laundering laws and regulations that prohibit, among other things, involvement in receiving and/or transferring the proceeds of criminal activities and impose obligations to identify the users and request certain information and documentation that, in certain circumstances, must be shared with regulators or government institutions.SanctionsAs a U.S-incorporated entity, MercadoLibre is subject to U.S. sanctions administered by the Office of Foreign Assets Control (“OFAC”). MercadoLibre’s non-U.S.S. OFAC has the authority to impose civil penalties for violations of U.S. sanctions, and the U.S. Department of Justice is authorized to bring criminal actions against persons that willfully violate U.S. sanctions. Compliance with United Nations sanctions is also mandatory under local law in the jurisdictions where MercadoLibre operates. Failure to comply with local obligations could result in significant criminal and civil penalties, in addition to reputational and operational consequences.ShippingA number of jurisdictions where we operate have enacted legislation regulating shipping services. Any change to our Mercado Envios business practices that makes the service less attractive to customers or prohibits its use by residents of a particular jurisdiction could decrease the speed of trade on the Mercado Libre Marketplace, which would further harm our business.Sale, Storage and/or Transportation of Goods and ServicesLaws specifying the scope of liability of providers of online services for the activities of their users through their online service are currently unsettled in most of the Latin American countries where we operate. This regulatory uncertainty may lead us to engage in administrative and judicial proceedings to dispute claims for fraudulent activities committed by sellers, vendors or third-party carriers and losses incurred by buyers when purchasing items through our platform, which may give rise to high litigation or settlement costs and other liabilities, including reputational harm. Our policies prohibit the sale, storage and/or transport of certain items (both on our platform and/or in our fulfillment centers and/or through third party carriers providing services to Mercado Libre) and we have implemented various actions to monitor and remove unlawful goods and services from our marketplace, which we continually work to improve.However, we are aware that certain goods, such as alcohol, tobacco, firearms, animals, adult material and other goods that may be subject to regulation by local or national authorities of various jurisdictions have been traded by users on the Mercado Libre Marketplace in complete infringement to our policies, bypassing our various security efforts and measures to go undetected. We are also aware that certain goods expressly excluded from our shipping services pursuant to our policies were stored in our fulfillment centers and/or delivered through third-party carriers providing services to our users.We cannot provide any assurances that we will successfully avoid civil or criminal liability for unlawful activities that our users carry out when using our services in the future. If we suffer potential liability for any unlawful activities of our users, including as a result of damages to individuals or assets, we may need to implement additional measures to reduce our exposure to this liability, which may require, among other things, that we spend substantial resources and/or discontinue certain service offerings. Any costs that we incur as a result of this liability or asserted liability could have a material adverse effect on our business, results of operations and financial condition.Table of ContentsIt may be difficult to enforce judgments rendered against us in U.S.S.S. As a result, it may not be possible to effect service of process within the U.S. upon these persons. Moreover, uncertainty exists as to whether courts outside of the U.S. would recognize or enforce judgments rendered against us, our subsidiaries, or the above mentioned persons in U.S. courts and predicated on the civil liability provisions of U.S. federal securities laws. In addition, any original or enforcement action in a court outside the U.S. will be subject to compliance with procedural requirements under applicable local law, including the condition that the judgment does not violate the public policy of the applicable jurisdiction. Despite these measures and our efforts to combat IP infringement, we are not able to prevent all misappropriation, violation or infringement of IP rights—and some IP owners may consider our efforts insufficient. Although we were removed from both watchlists in 2022, and we were not included again since then, we anticipate that we may continue to be nominated or included in these and/or any other similar watchlists. If we are held liable or potentially liable for information carried on or disseminated through our platforms, we may have to pay monetary damages, be subject to enforcement actions, injunctions, fines or penalties, and it may have an adverse impact on our business model, including our level of exposure to liability. Any measures we may need to implement to reduce that exposure may involve spending substantial resources and/or discontinuing certain services, which could have a material adverse effect on our business, results of operations and financial condition. In addition, public attention to liability issues, lawsuits and legislative proposals could have an adverse impact on our business model and reputation, and—consequently—on our business results.We may not be able to adequately protect and enforce our intellectual property rights. These rights are safeguarded through a combination of copyright, trademark, patent, trade secret laws, and contractual measures. With the rapid expansion of our business in recent years, we have witnessed a concurrent rise in infringement on our IP rights, notably on social media platforms. This includes issues such as unauthorized domain name registrations, deceptive apps and counterfeit or fraudulent websites. While we have undertaken measures to defend our IP rights, there is no guarantee that these actions, or any future efforts, will effectively deter misappropriation, safeguard against the dilution of our trademarks, or prevent third parties from creating similar or competing technologies.Our trademark portfolio is owned by MercadoLibre, Inc. and its subsidiaries. There are no material intellectual property assets jointly owned with any third party. The most valuable intellectual property owned by us is the “Mercado” trademark family portfolio, namely, Mercado Libre and Mercado Pago, among others, and related domain names ("TLDs" and "ccTLDs"), as well as our proprietary software. However, we may not have sufficient protection or such protection might not be granted to us by the appropriate regulatory authority in every country where our services are available online. Thus, our ability to protect our brands and our products and services against third-party infringers may be compromised and we could face claims by third-party IP owners. We may also be required to enter into licensing agreements, which may be on terms that are unfavorable to us and some of the licenses may be not be available to us at all. If any of these claims against us are successful, we may also have to modify some of our brand identifiers and/or domain names in certain countries or stop offering certain features, functionalities, products or services in certain jurisdictions. Further, many of our agreements with our customers and partners, the terms of which often survive termination or expiration of the applicable agreement, require us to defend such parties against certain intellectual property infringement claims and indemnify them for damages and losses arising from certain intellectual property infringement claims against them, which have in the past resulted, and could in the future result, in increased costs for defending such claims or significant damages if there is an adverse ruling in any such claims. These defense costs and indemnity payments could materially and adversely affect our results of operations, financial condition, business and prospects. Such customers and partners may also discontinue the use of our products and services as a result of injunctions or otherwise, which could result in loss of revenue and adversely affect our business.Our Company extensively utilizes open source software (“OSS”), presenting significant intellectual property challenges. In 2022, we established the OSPO (Open Source Program Office) to oversee OSS compliance, contribute to open source project development, and implement company-wide OSS usage policies. Despite the implementation of OSPO, we cannot guarantee that all of our employees accurately use and integrate OSS tools. As a result, given the high level of OSS consumption in our Company, we cannot guarantee that our use of OSS software will not inadvertently infringe upon third-party intellectual property rights or fully comply with pertinent OSS licenses. In addition, we cannot guarantee that our employees will not disclose any Company software to the open source software community. From time to time, companies that use OSS have faced claims challenging the use of OSS and/or demanding compliance with open source license terms. We could be subject to suits by parties claiming non-compliance with open source licensing terms. Moreover, these licenses may subject us to certain unfavorable conditions, including requirements that we offer our products that incorporate, are based on or that link to OSS for no cost, that we make publicly available the source code for any of our proprietary software that we create based upon, or that incorporates, links to or otherwise uses the OSS, or that we license such software under the terms of the particular open source license.The integration of AI tools into our products and services presents significant IP challenges. Determining IP ownership for AI-generated content remains ambiguous in some jurisdictions, which may potentially lead to infringement claims by third parties. AI tools might also unintentionally access or use third party IP or generate outputs which may contain or be substantially similar to third-party material protected by intellectual property rights, including patents, copyrights or trademarks, heightening our exposure to IP disputes. Using third-party AI tools raises concerns about the origin of content, which may lead to IP infringements that could inadvertently implicate us. Inventions or works of authorship created through the use of AI/ML may be based or rely on, or contain, materials that were used in the training of such AI/ML technologies and which are identical or similar to third-party intellectual property, which could further limit our ability to obtain intellectual property protection in such inventions or works of authorship. In addition, AI tools may access our confidential information, including personal data. Moreover, there is a risk that an employee may input confidential information, including material non-public information, trade secrets or personal identifiable information, into AI/ML applications, resulting in such information becoming accessible by third parties, including our competitors. As AI tools continue to evolve, ensuring protection against IP infringement and avoiding risks related to leaks of confidential information becomes progressively more challenging. Such challenges could also affect our consumers’ and the public’s perception of our Company. As our Company’s business grows and our reliance on OSS and AI tools increases, the potential risk of facing IP claims becomes more pronounced. Addressing these infringement claims can be costly, time-consuming, and could significantly impact our business, operational results, financial health and reputation. We are also susceptible to errors in connection with any systems upgrade or migration to a different hardware or software system, errors or incidents of our cloud providers, bugs or other problems for any of the software we use, either developed in-house or provided by third parties. Security breaches, financial, regulatory or other developments that might prevent these third parties from providing services to us or our users could harm our business.Our systems and our information technology infrastructure are vulnerable to damage or interruption from natural or man-made disasters, power loss, computer viruses, telecommunication and other operational failures, ransomware attacks or any other kind of denial of service related attacks, physical or electronic break-ins, sabotage, intentional acts of vandalism, terrorism, public health crises (including pandemics), extreme weather (including as a result of climate change) and similar events. The public cloud providers we use could also decide to close their facilities or be required to suspend the provision of services.Any steps that we may take to upgrade and improve the stability and efficiency of our information technology may not be sufficient to avoid defects or disruptions in our technology infrastructure, which could cause a disruption in our business and adversely impact our financial results. Our systems are not fully redundant and our disaster recovery planning may not be sufficient. We do not have insurance coverage to compensate for any related losses. Any errors, defects, disruptions, interruptions, delays or cessation of service could result in significant disruptions to our business that could ultimately be more expensive, time consuming and resource-intensive than anticipated.Table of ContentsWe are subject to security breaches, disruption and confidential data theft from our systems, which can adversely affect our reputation and businessA significant risk to our business lies both in the secure transmission of confidential information over public networks and in the continuity of our operations, given our heavy reliance on technology. We rely on encryption, authentication, data protection, infrastructure and application security hardening, monitoring and response measures to safeguard our systems and securely transmit confidential information. However, advances in computing capabilities, new discoveries in cryptography or other unforeseen events may compromise the technology we use to protect customer transaction data. There is no assurance that the security measures we have put in place will be effective in every case, and our response process to incidents may not be adequate, may fail to accurately assess the severity of an incident, may not be fast enough to prevent or limit harm or may fail to sufficiently remediate an incident. Failures and breaches in security could result in a negative impact for us and for our customers, adversely affecting our and our customers’ businesses, assets, revenues, brands and reputations, disrupting our operations and resulting in penalties, fines, litigation, regulatory proceedings, regulatory investigations, remediation efforts, indemnification expenditures, reputational harm, negative publicity, lost revenues and/or other potential liabilities, in each case depending on the nature of the information disclosed.The techniques employed to gain unauthorized, improper or illegal access to our systems, data, or customers' data—such as disabling or degrading services or sabotaging systems—are constantly evolving. These techniques have become increasingly complex and sophisticated, can be challenging to detect quickly and are often not recognized until actively deployed against a target.Unauthorized parties have, and may continue to, attempt to gain access to our systems or facilities through various means, including hacking into our systems or those of our customers, partners or vendors. They may also attempt to fraudulently induce our employees, customers, partners, vendors or other system users to disclose usernames, passwords, payment card information or other sensitive data. Such information could then be used to access our information technology systems or those of our third-party partners. Our users have been, and will likely continue to be, targeted by fraudulent “spoof” and “phishing” emails that appear to originate from Mercado Libre, Mercado Pago or another user of our services. These emails direct recipients to fake websites operated by malicious actors or falsely claim that a payment was credited by Mercado Pago, requesting that the recipient send a product or confidential information, such as passwords.Our information technology systems and infrastructure, including our source code, as well as those of third parties with whom we collaborate, have been—and may continue to be—vulnerable to cyberattacks and security breaches. Unauthorized parties may gain access to customers' personal or proprietary information, including credit and debit card data stored on or accessible through these systems. This access could also disrupt our business operations, including financial, e-commerce and logistics services.Furthermore, our security measures may be compromised due to human error, misconduct, system malfunctions, vulnerabilities or other irregularities.The laws and regulations relating to personal data are constantly evolving as governments continue to adopt new measures addressing data privacy and processing (including collection, storage, transfer, disposal and use) of personal data. Moreover, the interpretation and application of many existing or recently enacted privacy and data protection laws and regulations are uncertain and fluid, and it is possible that such laws and regulations may be interpreted or applied in a manner that is inconsistent with our existing data management practices or the features of our products and services. Any such new laws or regulations, any changes to existing laws and regulations and any such interpretation or application may affect demand for our products and services, impact our ability to effectively transfer data across borders in support of our business operations or increase the cost of providing our products and services. Additionally, any actual or perceived breach of such laws or regulations, including due to vulnerabilities or data breaches, may subject us to investigations and claims and may lead to administrative, civil or criminal liability, as well as reputational harm to our Company and our employees. We could also be required to fundamentally change our business activities and practices, or modify our products and services, which could have an adverse effect on our business. Such mandatory disclosures could lead to negative publicity, damage our reputation, devalue our brands and may cause our current and prospective customers to lose confidence in the effectiveness of our data security measures. The use of AI/ML, including potential inadvertent disclosure of confidential information or personal data, could also lead to legal and regulatory investigations and enforcement actions, or may give rise to specific obligations, including required notices, consents and opt-outs, under various data privacy, protection and cybersecurity laws and regulations in a number of jurisdictions. However, there is no assurance that future breaches will have a similar outcome. Moreover, any network or data security breaches involving companies we acquire, our customers, partners or vendors—including service providers—could result in similar negative consequences.We may not be able to secure licenses for technologies on which we relyWe rely on certain technologies that we license from third parties that supply key database technology, operating systems and specific hardware components for our services. We cannot assure you that these technology licenses will continue to be available to us on commercially reasonable terms, or at all. Although we generally have been able to renew or extend the terms of contractual arrangements with these service providers on acceptable terms, we cannot assure you that we will continue to be able to do so in the future.Table of ContentsRisks related to doing business in Latin AmericaWe face the risk of political and economic crises, instability, terrorism, civil strife, labor conflicts, expropriation, corruption and other risks of doing business in emerging marketsWe conduct our operations in emerging market countries in Latin America, which have historically experienced uneven periods of economic growth, as well as recession, periods of high inflation and economic instability. There has been increased violence, crime, social and political turmoil and unrest in some of these countries, which could result in disruptions to our operations or present risks to our employees. These developments, as well as other economic and political developments in these countries, including future economic changes or crises (such as inflation, currency devaluation or recession), government deadlock, social and political turmoil and unrest, changes in laws and regulations, labor conflicts, expropriation or nationalization of property, and exchange controls could impact our operations or the market value of our common stock and have a material adverse effect on our business, financial condition and results of operations. We also have operations and deal with government entities and financial institutions in countries in Latin America known to experience corruption. Our activities in these countries create the risk of unauthorized payments or offers of payments by our employees, contractors or agents that could be in violation of various laws including the FCPA, even though these parties are not always subject to our control. Our existing safeguards and any future improvements may prove to be less than effective, and our employees, contractors or agents may engage in conduct for which we may be held responsible. Violations of the FCPA may result in severe criminal or civil sanctions, and we may be subject to other liabilities, which could negatively affect our reputation and business. Further, to the extent corruption, bribery and similar practices continue to exist in the region, international investor perception of the region could be negatively affected, which could in turn negatively affect our business, financial condition and results of operations. We may incur increased payroll costs or reduced flexibility under labor regulations if unionization in other countries were to occur, any of which may negatively impact our business. In addition, we could be affected by conflicts between unions which claim representation of our employees that could generate additional payroll costs and labor conflicts.Although economic and political conditions may differ from one country to another, we cannot assure you that events in one country alone will not adversely affect our business, financial condition or the market value of our common stock.Latin American governments have exercised and continue to exercise significant influence over the economies of the countries where we operate. Our business, financial condition, results of operations and prospects may be adversely affected by changes in government policies or regulations, including such factors as: exchange rates and exchange control policies; inflation rates; interest rates; tariff and inflation control policies; price control policies; import duties and restrictions; liquidity of domestic capital and lending markets; electricity rationing; tax policies, including royalty, tax increases and retroactive tax claims; and other political, diplomatic, social and economic developments in or affecting the countries where we operate. Reduced foreign investment in any of the countries where we operate may have a negative impact on such country’s economy, affecting interest rates and the ability of companies such as ours to access financial markets. Local currencies used in the conduct of our business are subject to depreciation, volatility and exchange controlsMost Latin American countries have historically experienced, and may continue to experience in the future, high rates of inflation, which could lead to further government intervention in the economy, including the introduction of government policies that could adversely affect our results of operations. Brazil, Argentina and Mexico, which together accounted for 95. For the year ended December 31, 2024, the inflation rate in Brazil, Argentina and Mexico was 4.8%, 117.8% and 4.2%, respectively. Since July 1, 2018, we have classified our Argentine operations as highly inflationary in accordance with U.S. GAAP, and use the U.S. dollar as the functional currency of our Argentine subsidiaries for purposes of reporting our financial statements. Argentina’s annual inflation rate for the years ended December 31, 2024, 2023 and 2022 was 117.8%, 211.S.7%, 356.5%, respectively.The depreciation of local currencies creates inflationary pressures that may have an adverse effect on our results of operations, including affecting our ability to adjust the price of our services sufficiently to offset the effects of inflation on our cost structures and generally restricting access to the international capital markets. On the other hand, the appreciation of local currencies against the U.S. dollar may lead to the deterioration of public accounts and the balance of payments of the countries where we operate, and may reduce export growth in those countries.Table of ContentsBecause we conduct our business outside the U.S. and receive almost all of our revenues in currencies other than the U.S. dollar, but report our results in U.S. dollars, we face exposure to adverse movements in currency exchange rates. The results of operations in the countries where we operate are exposed to foreign exchange rate fluctuations as our financial results are translated from the applicable local currency into U.S. dollars upon consolidation. If the U.S. dollar weakens against foreign currencies, as has occurred in some years, the translation of these foreign-currency-denominated transactions will result in increased net revenues, operating expenses, and net income. Similarly, our net revenues, operating expenses, and net income will decrease if the U.S. dollar strengthens against the foreign currencies of countries in which we operate. For the year ended December 31, 2024, 54.S.9%. Certain of our subsidiaries may be subject to exchange control regulations that might restrict their ability to convert local currencies into U.S. dollars. Brazilian law provides that whenever there is a serious imbalance in Brazil’s balance of payments or reason to foresee a serious imbalance, the Brazilian government may impose temporary restrictions on the remittance to foreign investors of the proceeds of their investments in Brazil. An entity’s authorization request to the CBA to access the official exchange market to make foreign currency payments may be denied depending on the circumstances.S. dollars locally or outside Argentina.Regulations issued by the current Argentine government have partially decreased exchange controls; however, there can be no assurance that the CBA or other government agencies will not subsequently increase controls or restrictions, make modifications to these regulations or establish more severe restrictions on currency exchange, which could affect the ability to make payments to foreign creditors or providers and dividend payments to foreign shareholders.Our transactions in Latin America may be impacted by the weaknesses of secure payment methodsConsumers and merchants in Latin America can be held fully liable for credit card and other losses due to third-party fraud. In addition, while banks and other financial institutions in Latin America have generally granted merchants the right to process online transactions, adjustments to the fraud and risk management processes of these banks and financial institutions, including due to concerns about credit card fraud, may negatively impact our payments approval rates.Risks related to our sharesProvisions of our certificate of incorporation and Delaware law could inhibit others from acquiring us, prevent a change of control, and may prevent efforts by our stockholders to change our managementCertain provisions of our certificate of incorporation and by-laws may inhibit a change of control that our board of directors does not approve or changes in the composition of our board of directors, which could result in the entrenchment of current management and may delay, defer or prevent a transaction or a change in control that might otherwise be in the best interests of our stockholders.These provisions include: i) advance notice requirements for stockholder proposals and director nominations; ii) a staggered board of directors; iii) limitations on the ability of stockholders to remove directors other than for cause; iv) limitations on the ability of stockholders to own and/or exercise voting power over 20% of our common stock; v) limitations on the ability of stockholders to amend, alter or repeal our by-laws; vi) the inability of stockholders to act by written consent; vii) the authority of the board of directors to adopt a stockholder rights plan; viii) the authority of the board of directors to issue, without stockholder approval, preferred stock with any terms that the board of directors determines and additional shares of our common stock; and ix) limitations on the ability of certain stockholders to enter into certain business combinations with us, as provided under Section 203 of the Delaware General Corporation Law.We may require additional capital in the future, and this additional capital may not be available on acceptable terms or at allWe may need to raise additional funds in order to fund more rapid expansion (organically or through strategic acquisitions), to develop new or enhanced services or products, to respond to competitive pressures or to acquire complementary products, businesses or technologies. If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders will be reduced, stockholders may experience additional dilution and the securities that we issue may have rights, preferences and privileges senior to those of our common stock. Additional financing may not be available on terms favorable to us or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to fund our expansion, take advantage of unanticipated acquisition opportunities, develop or enhance services or products or respond to competitive pressures. These inabilities could have a material adverse effect on our business, results of operations and financial condition. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.Table of ContentsIn the future, we may issue securities in connection with investments and acquisitions. The amount of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then outstanding common stock. Our repurchase programs may not require us to repurchase any specific required dollar amount or number of shares. Further, our repurchases could affect our share trading prices, increase their volatility, reduce our cash reserves and may be suspended or terminated at any time, which may result in a decrease in the trading of our stock. As of December 31, 2024, we did not have an active share repurchase program.ITEM 1B. CYBERSECURITYRisk Management and StrategyWe maintain a comprehensive process for assessing, identifying and managing material risks from cybersecurity threats, including risks relating to disruption of technology infrastructure and business operations, intellectual property theft, fraud, harm to employees or customers, violation of privacy laws and confidentiality, other litigation and legal risks, and reputational risk, as part of our overall risk management principles and processes.Our risk management framework includes several security pillars, including data security, identity management, cloud security, infrastructure security, application security, incident response, and cybersecurity risk management.We conduct annual International Organization for Standardization Information Security Management Systems ("ISMS") Requirements ("ISO/IEC 27001") reviews and Payment Card Industry Data Security Standard ("PCI-DSS") reviews of our payment information security controls with the assistance of an external certified auditor.Our cybersecurity risk management processes incorporate frameworks aligned with recognized cybersecurity and cyber risk established frameworks. Our cybersecurity model is based on four criteria: (i) “Zero Trust” (e.g. a model based on continuous validation of users and devices), (ii) analysis of abnormal or unusual behavior, (iii) automatic response, and (iv) decentralization. Our cybersecurity risk strategy aligns risks, initiatives and controls, consisting of initiatives and projects designed to identify, evaluate, control and monitor cybersecurity risks and incidents. Our data security and privacy strategy focuses on discovery, minimization, detection, response, standardization and awareness. Our incident response strategy is based on best practices, focusing on proactive and automatic response, preparation and prevention, detection and analysis, containment, eradication, recovery and post-incident activity. We have also implemented a security risk management policy that provides guidance on how to identify, analyze, and optimize risk management and subsequent risk mitigation.We have processes in place to assess, identify, manage, and address cybersecurity threats and incidents. These include, among other things: mandatory trainings and drills on social engineering, phishing and ransomware attacks for all our employees; tabletop exercises for employees of the information security team; cybersecurity events in which management and/or certain employees participate and/or organize; ransomware prevention and phishing controls allowing for automatic and timely detection and response; and penetration testing, red team exercises and a bug bounty program to help us evaluate the effectiveness of our information security processes and improve our security measures and planning. We also have teams in place to oversee and manage our cybersecurity risk management processes, including: (i) an information security team, organized around our various services and products, responsible for day-to-day cybersecurity matters related to the respective services and products; (ii) a risk committee that is comprised of members of management and oversees the Company’s financial and non-financial risks, including cybersecurity risks, as described in more detail below under the heading “Governance”; and (iii) internal local, corporate and strategic crisis management teams that form part of our crisis management framework.Our risk management framework further includes processes to manage cybersecurity risks associated with third parties, including, a third-party risk management program that focuses on identifying security and data privacy risks arising out of our interactions with critical third-party suppliers and payment methods, and a program focused on assessing risks arising in mergers and acquisitions transactions.In connection with our cybersecurity risk management processes, while we do not regularly engage assessors, consultants, auditors, or other third parties to assess, identify, and manage material risks from cybersecurity threats, we do involve such parties if there has been a cybersecurity incident that we believe requires an assessment by a third party. Our business strategy, results of operations and financial condition have not been materially affected by risks from cybersecurity threats, including as a result of previous cybersecurity incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks and any future material incidents. In the last fiscal three years, we have not experienced any material information security breach incidents and the expenses we have incurred from information security breach incidents were immaterial.

See “Risk Factors” in Item 1A of this Annual Report on Form 10-K for more information on our cybersecurity-related risks.Table of ContentsGovernanceManagement The cybersecurity risk management processes described above are managed by our Cybersecurity VP under the supervision of the risk committee. The Audit Committee of the board of directors provides additional oversight as needed. Our risk committee is comprised of the Chief Financial Officer, Commerce President, Fintech President and the Heads of Corporate Affairs, Risk & Compliance, Data Privacy, Information Security, AML & Sanctions, Legal & Government Relations, Commerce Product Development, Fintech Product Development and IT Infrastructure. The primary purpose of the risk committee is to assist management and the board, either directly or indirectly through the board’s Audit Committee, with their oversight of the Company’s financial and non-financial risks, including cybersecurity risks. Our Cybersecurity VP and certain other members of our risk committee are skilled in technology, security and/or risk and compliance. Our Cybersecurity VP is a certified information systems security professional and has considerable experience in the field of information security, fraud and prevention. As part of our cybersecurity risk management processes, our Cybersecurity VP presents security risk matters to the risk committee on an as-necessary basis and to the Audit Committee annually and on an as-necessary basis. The risk committee also meets quarterly and presents to management the status, evolution and main indicators of each principal security risk, although information security may not be deemed a risk in each particular quarter. In the event of a critical cybersecurity incident, the Company’s crisis management framework activates the cross-functional crisis management team, which, depending on the circumstances, is comprised of the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Commerce President, Fintech President, Corporate Affairs Executive VP, Marketing Executive VP and the Cybersecurity VP. This group works with the incident response team to help to evaluate, contain, eradicate and, if necessary, recover from the incident. The Company’s cybersecurity processes are formally evaluated by the Cybersecurity VP on an annual basis, which includes updating the Company’s cybersecurity policy, security risk management policy and methodology, and classification of information. Board of directorsThe Audit Committee is primarily responsible for the oversight of cybersecurity risks and threats. To fulfill this responsibility, the Audit Committee, assisted, as appropriate, by the risk committee, oversees the risk management framework, including risk assessment and risk management policies and procedures established by management to identify, evaluate, measure and manage existing and potential cybersecurity risks faced by the Company. Annually and on an as-necessary basis, individual members of management and/or of the risk committee provide presentations to the Audit Committee regarding cybersecurity matters, including any material risks. These presentations include information regarding cybersecurity risks, the evolution of those risks and initiatives to optimize and improve the processes of cybersecurity. Further, in the event of a specific cybersecurity incident, these presentations include information about the relevant security incident, such as incident status, informed stakeholders and remediation plans..

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FIZZ	1 week, 6 days ago
KEQU	1 week, 6 days ago
AERT	2 weeks ago
CRDO	2 weeks ago
MSBI	2 weeks ago
NCL	2 weeks, 1 day ago
QLGN	2 weeks, 1 day ago
CNVS	2 weeks, 1 day ago
PMNT	2 weeks, 1 day ago
STEK	2 weeks, 1 day ago
PTCO	2 weeks, 1 day ago
FATN	2 weeks, 1 day ago
ZCAR	2 weeks, 1 day ago
SUND	2 weeks, 1 day ago
ELTP	2 weeks, 1 day ago
RGPX	2 weeks, 1 day ago
ELRE	2 weeks, 1 day ago
PCSV	2 weeks, 1 day ago
ATXG	2 weeks, 2 days ago

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-New additions in green
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