DLocal’s Strong Quarter Came With A Warning: Here’s What Spooked Investors

• CEO Pedro Arnt also warned about shifting fiscal and tax regimes in Brazil as another alarming factor, as well as the potential for currency devaluations.
• DLocal reiterated its annual forecasts despite the slowdown.
• The company reported revenue of $282.5 million for the quarter ended Sept. 30, which exceeded the $262 million analysts had expected, according to Fiscal.ai data.

DLocal stock fell by over 13% in premarket trading on Thursday after the company warned that higher import tariffs in Mexico have slowed its business in the country.

The Montevideo, Uruguay-based payments firm took a hit after Mexico raised import tariffs on low-value packages from 19% to 33.5% in August, targeting shipments valued under $2,500 delivered via courier or parcel services. The tariff affected countries with which Mexico doesn’t have a free-trade agreement, including China, whose retailers, such as Shein and Temu, often ship goods to Mexico in small parcels. Mexico represented 16% of its quarterly revenue.

The move tracked a similar step taken by the Trump administration earlier this year to end the de minimis exception. “Recent increase in tariffs in Mexico for low-value goods has already caused a slowdown in our Mexican business, as witnessed this quarter,” said CEO Pedro Arnt. “That, along with potential trade barriers in other markets, should be followed closely.”

Arnt also warned about shifting fiscal and tax regimes in Brazil as another alarming factor, as well as the potential for currency devaluations and/or changes in foreign exchange regimes beyond Argentina, such as in Egypt or Bolivia.

Tariff Warnings Take the Shine From Upbeat Earnings

The company reported revenue of $282.5 million for the quarter ended Sept. 30, which exceeded the $262 million analysts had expected, according to Fiscal.ai data. Its total payment volume (TPV) surged to a record high of $10.4 billion.

The company reported strong growth in remittances, e-commerce, on-demand delivery, and SaaS verticals. Its third-quarter net income came in at $51.8 million, or $0.17 per share, compared to a profit of $26.8 million, or $0.09 per diluted share, for the third quarter of 2024.

What Are Stocktwits Users Thinking?

Retail sentiment on Stocktwits about DLocal was in the ‘extremely bullish’ territory at the time of writing.

“This is one of those companies that will likely continue to grow/improve organically over time to a valuation multiple from today,” one user wrote.

DLocal Reiterates Outlook

Despite the slowdown in Mexico, DLocal was upbeat about its annual forecast. It had raised its TPV growth projections for 2025 to 40% to 50%, and revenue to a range of 30% to 40% in August.

“Revenue is tracking around the upper limit for the year, while gross profit and adjusted EBITDA are likely to be between the midpoint and the upper level,” Arnt said. It also projected TPV to exceed the high-end of its outlook.

DLocal stock has gained 37% this year.

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