GET DAILY SIGNALSDLocal (DLO) Delivers Record Net Income as TPV Jumps 77% in Q3
Key Takeaways
- Revenue reached $398.05 million, up 41% year over year, but came in roughly $10.4 million below the consensus estimate of $406.72 million.
- Diluted earnings per share (EPS) of $0.23 beat the consensus estimate of $0.22 by $0.01.
- Total payment volume (TPV), the value of payments processed, climbed 77% year over year to $18.3 billion, marking an eighth consecutive quarter of 50%-plus growth.
- Net income rose 31% year over year to a record $68 million.
- Gross profit margin narrowed to 33% from 37% a year earlier, reflecting a mix shift toward lower-margin transactions and softer volumes in Argentina.
- Full-year 2026 guidance was maintained, though management expects operating profit growth to land at the lower end of its range due to currency headwinds.
Why These Results Matter
DLocal runs a cross-border payments platform that links global merchants with emerging markets, so its quarterly updates provide a window into digital commerce trends across Latin America, Africa, and Asia. The company has posted an extended run of fast TPV growth, which makes it worth watching whether that pace can hold while earnings remain solid. Ahead of the third quarter, attention centered on revenue stability after a strong second quarter, the path of gross margins, and the impact of currency shifts in Brazil, Mexico, and Argentina. With operating leverage now key to the case for the stock, this report tested DLocal’s ability to turn payments growth into lasting profits.
The Quarter in Numbers
DLocal posted third-quarter 2026 revenue of $398.05 million, a 41% rise from $282.5 million a year earlier yet short of the roughly $406.7 million consensus. Diluted EPS came in at $0.23, a penny above the $0.22 estimate and higher than $0.17 last year. Net income hit a record $68 million, up 31% from the prior year. I also checked this using Tickeron’s AI Screener to see how the stock compares with others in the industry.
TPV rose 77% year over year to $18.3 billion, the eighth straight quarter of more than 50% growth. Gross profit increased 28% to $132 million, and operating profit grew 37% to $76.2 million. The operating-profit-to-gross-profit ratio improved to 58% from 54%. Gross profit margin, however, slipped to 33% from 37%, owing to a shift toward local-to-local and pay-out volumes plus softer activity in Argentina. Adjusted free cash flow reached $99.1 million, up 163% year over year. Management kept its full-year 2026 targets for 60%-70% TPV growth and 25%-30% gross-profit growth, while signaling that operating-profit growth would likely land at the lower end of the 27.5%-32.5% range because of foreign-exchange pressure.
Market Response
Shares of DLocal fell about 2.9% in after-hours trading. The move reflected the revenue shortfall versus estimates, even though the company posted an EPS beat and record net income. Investors appeared to balance the strong volume and cash-flow gains against the narrower gross margin and the note that operating-profit growth would come in at the low end of the range. Revenue was essentially flat from the seasonally strong second quarter, and currency effects in key markets weighed on sentiment. The reaction points to a market that is prioritizing margin stability and revenue trends over headline profit growth.
What Comes Next
Looking ahead, the focus will be on whether DLocal can keep TPV expanding quickly as year-over-year comparisons become tougher. Management expects growth to moderate as projected, while operating expenses have already dropped sharply from the prior quarter. The key question is whether the operating leverage seen this quarter carries forward.
Currency and margin trends remain the main risks. The company pointed to unexpected FX headwinds in Brazil, Mexico, and Argentina as a drag on revenue and gross profit, along with softer results in smaller, higher-take-rate markets in Africa and Asia. Shifts in Brazil’s tax and macro environment, Argentina’s exchange rate, and tariff exposure in Mexico and Brazil all merit close attention.
Other items to follow include the net revenue retention rate, which stood at 140% this quarter, and the ongoing mix shift toward lower-margin local-to-local and pay-out volumes. Continued gains in cost control, automation, and free-cash-flow conversion will help show whether DLocal can protect profitability as growth normalizes.
Using AI Tools in My Research
When I want to scan for similar setups across the broader market, Tickeron’s AI Screener is one of the tools I turn to. It lets me apply filters for technical patterns, fundamentals, and performance metrics to surface ideas that complement what I see in individual earnings reports. The process helps me spot potential comparables or breakout candidates without spending hours on manual screens.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
DLO's Stochastic Oscillator remains in overbought zone for 1 day
Expect a price pull-back in the near future.
Technical Analysis (Indicators)
Bearish Trend Analysis
DLO moved below its 50-day moving average on October 26, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for DLO crossed bearishly below the 50-day moving average on October 29, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 11 of 16 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 69%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where DLO declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 83%.
The Aroon Indicator for DLO entered a downward trend on October 13, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where DLO's RSI Indicator exited the oversold zone, 27 of 32 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 84%.
The Momentum Indicator moved above the 0 level on November 11, 2026. You may want to consider a long position or call options on DLO as a result. In 76 of 90 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 84%.
The Moving Average Convergence Divergence (MACD) for DLO just turned positive on November 10, 2026. Looking at past instances where DLO's MACD turned positive, the stock continued to rise in 37 of 45 cases over the following month. The odds of a continued upward trend are 82%.
Following a +7.23% 3-day Advance, the price is estimated to grow further. Considering data from situations where DLO advanced for three days, in 229 of 292 cases, the price rose further within the following month. The odds of a continued upward trend are 78%.
DLO may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 25 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 53 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (7.598) is normal, around the industry mean (16.272). P/E Ratio (19.929) is within average values for comparable stocks, (52.956). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (3.648). Dividend Yield (0.056) settles around the average of (0.430) among similar stocks. P/S Ratio (3.154) is also within normal values, averaging (103.889).
The Tickeron Price Growth Rating for this company is 57 (best 1 - 100 worst), indicating steady price growth. DLO’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 82 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. DLO’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 92, placing this stock worse than average.
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