dLocal Falls Despite Blowout Q3 Results—What Investors Are Missing

dLocal (DLO) reported robust Q3 2025 results, surpassing revenue and EPS estimates with a 52% year-over-year revenue increase to $282.5 million and Total Payment Volume (TPV) up 60% to $10.4 billion. Despite these strong financial metrics, shares fell over 7% in after-hours trading due to a slight decline in the net take rate from 1.07% to 0.99%. Management clarified that the take rate dip was primarily due to previously disclosed wallet-share losses in Egypt, with underlying growth remaining strong across Latin America and other regions, leading analysts to view the post-earnings pullback as a potential buying opportunity given the company's attractive valuation and continued expansion in emerging markets.

Analysis

dLocal (DLO) reported robust Q3 2025 results, significantly exceeding Wall Street estimates with revenue up 52% year-over-year to $282.5 million and Total Payment Volume (TPV) surging nearly 60% to a record $10.4 billion. Earnings per share of $0.17 also beat consensus by a penny, alongside strong profitability metrics including a 93% YOY net income increase to $51.8 million and a 37% rise in Adjusted EBITDA. This marks the fourth consecutive quarter of over 50% TPV growth, reinforcing its leadership in Latin American fintech.

Despite these strong operational and financial beats, DLO shares declined over 7% after-hours, primarily due to a slight dip in the net take rate from 1.07% in Q2 to 0.99% in Q3. Management attributed this decline to previously disclosed wallet-share losses in Egypt, clarifying it as an isolated issue rather than a structural concern. Performance in Latin America remained strong, with revenue reaching $234.3 million, indicating healthy geographic diversification.

The post-earnings pullback has brought DLO shares near $13, a key support level, making its forward P/E of 17.4 attractive for a high-growth fintech operating in emerging markets. Analysts maintain a "Moderate Buy" rating with a $15.67 price target, suggesting meaningful upside from current levels. The company's underlying fundamentals remain robust, with a strengthening balance sheet supporting continued growth and diversification.

Key Decisions for Investors

• Monitor the $13 support level for DLO shares as a potential entry point, given the attractive valuation at a 17.4 forward P/E for a high-growth fintech.
• Evaluate management's explanation regarding the net take rate decline as an isolated issue in Egypt, contrasting it with strong underlying growth in Latin America and other regions.
• Consider the consensus "Moderate Buy" rating and $15.67 price target as indicators of potential upside, while acknowledging short-term market jitters.