Amazon vs MercadoLibre: Two E-Commerce Titans, Only One is The Smarter Buy Now

Amazon (NASDAQ: AMZN | AMZN Price Prediction) and MercadoLibre (NASDAQ: MELI) just posted Q2 2026 results that double as a referendum on scale versus speed.

Amazon leaned on AWS and an aggressive AI infrastructure buildout. MercadoLibre pushed harder into Latin American commerce and fintech, accepting margin pain to grab share. Both beat estimates. Both are spending like the window is closing.

AWS Reaccelerates While MercadoLibre Trades Margin for Users

Amazon delivered $200.6 billion in revenue, up 19.62%, with AWS pulling the sled at $42.2 billion and a 39.4% operating margin. Andy Jassy called it “our fastest growth in 18 quarters”, and the AI and Chips businesses each cleared a $25 billion run rate. Advertising rose 26% to $19.8 billion. That is a very healthy flywheel.

MercadoLibre grew revenue 49.76% to $10.17 billion, its fastest pace in four years, but operating income fell 17.21% and operating margin compressed 550 bps to 6.7%. Marcos Galperin framed it plainly: “We are changing users’ behavior, and that is why we will continue to invest at the scale and pace the opportunity demands.” Items per buyer rose 14%, and MELI+ subscribers jumped 72%.

Global Hyperscaler vs. Regional Ecosystem Builder

Amazon is now a capex monster. Cash capex hit $53.1 billion in Q2 alone, and 2026 spend was raised to roughly $220 billion, with Jassy admitting “we will still not have enough capacity to meet all the demand we have in 2026.” Prediction market participants assign a 92.5% probability that 2026 capex clears $200 billion. This is a decade-long bet on cloud AI.

MercadoLibre is playing a different game. Capex was $441 million, but net debt climbed to $6.4 billion as Mercado Pago issued 2.6 million new credit cards. AUM reached $23 billion. Credit card NIMAL sits at a painful -2.5% as new cohorts dilute returns. Brazil grew 59%; Argentina slowed to 20%.

The Next Test Is Whether Spending Turns Into Free Cash

For Amazon, I want to see AWS backlog, currently $496 billion, convert into revenue faster than data center depreciation eats margins. Q3 guidance of $197 billion to $202 billion looks conservative given Prime Day timing noise. Free cash flow at negative on a TTM basis is the tell.

For MercadoLibre, the credit book is the swing factor. If NIMAL turns as cohorts mature, operating leverage returns quickly. If Mexico’s tax reform or Argentine consumption drag persists, that 6.7% margin could grind lower before it recovers.

Why I Lean Toward Amazon Today, but Keep MELI Close

If I have to pick one right now, I lean Amazon. The AWS reacceleration, ad flywheel, and Jassy’s framing that AI margins are “a little bit ahead” of the original cloud curve give me more comfort than MercadoLibre’s deliberate margin sacrifice. Shares are up 15.77% since the report, and I understand why.

That said, MELI’s 20.16% one-year decline has quietly reset expectations. If you want asymmetric upside from a genuine multi-decade regional buildout, Galperin’s “decades, not years” pitch is credible. A clean quarter of margin stabilization would strengthen the MercadoLibre thesis, but MELI remains the more interesting turnaround setup, while Amazon looks like the sturdier compounder.

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