dLocal Achieves Record TPV and Surpasses $100M in Gross Profit Amid Diversification Drive

TPV Growth Remains Strong, Driving Top-Line Expansion

dLocal has once again underscored its growth story in the third quarter of 2025, reporting a Total Payment Volume (TPV) of $10.4 billion—a new company record and a 59% increase over the same quarter last year. Notably, this marks the fourth consecutive quarter of TPV growth above 50% year-over-year. Revenue surged to $282.5 million, up 52% year-over-year, as demand for digital payments and cross-border commerce across emerging markets continues to fuel expansion.

Gross Profit Surpasses $100M, but Margins Tighten

This quarter marks the first time dLocal has posted gross profit above $100 million, at $103.2 million (up 32% year-over-year). However, rapid growth comes with its own set of pressures: gross profit margin slipped to 37% from 42% last year and 39% last quarter. Management attributed this to shifts in payment mix and some margin headwinds in key markets like Egypt and Mexico. Despite margin compression, adjusted EBITDA rose to $71.7 million, and net income nearly doubled to $51.8 million.

Regional Diversification Brings Both Opportunities and Risks

dLocal’s broad reach across more than 40 emerging markets is paying dividends, with strong performances in Colombia, Bolivia, and Nigeria contributing to the latest record-breaking quarter. Brazil’s payments landscape, especially in streaming and e-commerce, remains a key engine for growth. But not all markets moved in tandem—Egypt and Argentina posed headwinds, and margin pressures were felt in Mexico due to changing payment methods and regulatory factors.

Healthy Cash Generation Despite Quarter-Over-Quarter Decline

The company remains on solid footing with adjusted free cash flow at $37.6 million for the quarter (up 28% year-over-year) and $604.5 million in total cash and cash equivalents at quarter-end. While adjusted free cash flow declined compared to last quarter, management noted the dip is expected to reverse in the coming quarters, tied to short-term structuring for capital flows out of Argentina following regulatory changes.

Outlook: Growth Continues with Margin Watch in Focus

dLocal’s performance this quarter confirms both the resilience and opportunity of its business model—especially in capturing growth in high-potential emerging markets. However, margin compression and evolving regulatory landscapes remind investors that hyper-growth is rarely a straight line. With a conference call set for November 12, all eyes will be on management’s commentary around future margin trends, geographic mix, and cash repatriation strategy. For those tracking the payment space, dLocal’s numbers offer a useful benchmark for emerging market payment adoption and the challenges of scaling globally.

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