SAO PAULO (Reuters) - Latin America e-commerce giant MercadoLibre ( MELI ) said on Thursday its first-quarter net profit surged 71% from a year earlier, beating analysts' estimates as its performance in Brazil and Mexico offset some negative effects in Argentina.

MercadoLibre ( MELI ), which operates a marketplace in 18 countries and also owns the fintech Mercado Pago, posted a $344 million net profit in the three months, while analysts polled by LSEG had expected a $314 million net profit.

The firm disclosed some changes in reporting, including reclassification of Mercado Pago interest income and expense lines, with a $99 million positive impact on net revenue but no impact on net income. The changes also include a swap in the terms and conditions of Mercado Envios, which had a negative impact of $10 million on net income.

MercadoLibre ( MELI ) reported a $4.3 billion net revenue, up 36% from a year earlier and above the $3.9 billion estimated by analysts.

Sales from its main marketplace business rose 36% in Brazil, its top market, and 42% in Mexico, as measured by Gross Merchandise Value (GMV).

Operational margins, which analysts had negatively highlighted last quarter after higher logistics costs during the year-end peak, came in at 12.4%, up from the 11.2% a year earlier, without including the reporting changes.

CFO Martin de los Santos told Reuters that Argentina's macroeconomic situation had hurt margins, as a sharp currency devaluation late last year weighed on logistic costs and shrank its business there. Still, Brazil's and Mexico's performance have enabled a expansion year-on-year.

"We obviously continue to run a profitable business in Argentina. It's just that is not as profitable as it used to be", Santos said.

Argentina, where MercadoLibre ( MELI ) was founded, represented 15% of its earnings before interest and taxes (Ebit) in the first quarter, from over 50% a year earlier.

MercadoLibre ( MELI ) posted a total $528 million Ebit for the quarter, rising 29% from a year earlier, beating analysts' forecasts of $488 million.

For its fintech unit, MercadoLibre ( MELI ) increased its credit portfolio by more than $600 million from the previous quarter, the most since early 2022, to $4.4 billion. The lower-term delinquency rate rose to 9.3% from 8.2% in December, but over-90 days rate fell to 17.9% from 18.7%.

"The fact that we have better delinquency rates and better profitability enable us to be more confident in growing our origination in consumer and merchant grades," Santos said..