Good day, ladies and gentlemen. And welcome to the MercadoLibre First Quarter Earnings Conference Call. At this time all participants are in a listen-only mode. Later we will conduct a question and answer session and instructions will follow at that time. As a reminder, this conference is being recorded. I would like to introduce your host for today's conference, Mr. Martin de los Santos. Sir, you may begin. Martin de los Santos - Senior Vice President-Finance & Corporate Development: Hello, everyone and welcome to the MercadoLibre Earnings Conference Call for the quarter ended March 31, 2016. I am Martin de los Santos, Senior Vice President of Finance and Head of Investor Relations for MercadoLibre. Our senior manager presenting today is Pedro Arnt, Chief Finance Officer. Additionally Marcos Galperín, Chief Executive Officer; Osvaldo Gimenez, Executive Vice President of Payment will be available during today's Q&A session. This conference call is also being broadcast over the Internet and is available through the Investor Relations sections of our website. I remind you that management might make forward-looking statements related to such matters as continued growth prospect for the company, industry trend, and product and technology initiatives. These statements are based on currently available information and our current assumptions, expectations, and projections of a future event. While we believe that our assumptions, expectations, and projections are reasonable in view of the currently available information, you are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those discussed in this call. For a variety of reasons, including those described in the forward-looking statements and risk factors, sections of our 10-K and other filings with the Security and Exchange Commissions, which are available on our Investors Relations website. Finally, I would like to remind you that during the course of this conference call we might discuss some non-GAAP measures. A reconciliation of those measures to the nearest comparable GAAP measures can be found in our first quarter 2016 earnings press release available on our Investor Relations website. Now, let me turn the call over to Pedro.

Thanks, Martin. And welcome, everyone, to our First Quarter Conference Call for 2016. Let's get started by summing up our performance during this past quarter. The year has gotten off to a great start with sustained momentum of key operational metrics coming off of an already strong ending of 2015. We are very pleased to see our business outperform market growth rates while we continue to improve the quality and number of value-added services we offer in the areas of marketplace, payments, logistics, Classifieds, Credit, and Advertising. We believe these results are clear indicators that MercadoLibre is driving value to its users while scaling the business appropriately for the long-term. With that in mind, let's take a quick look at some key indicators that highlight our solid operational results. For the first quarter successful items accelerated to 39% growth year-over-year reaching 38.3 million units sold and recording the highest growth of the last four years. Gross merchandise volume reached $1.8 billion, and excluding our Venezuelan operations grew 58% on an FX Neutral basis. Total payment transactions grew 86% to 27.5 million. Total payment volume grew 108% on an FX Neutral basis, reaching $1.4 billion and representing over 75% of our GMV for the quarter. And finally, registered users were up 19.6% year-on-year, reaching 151.5 million after we added 6.9 million new users during the quarter. As units sold in GMV point out, our marketplace business had a great quarter and we're encouraged to see the strength has evenly spread across multiple geographies. Our Brazilian and Argentine businesses performed extremely well while Mexico and Colombia delivered promising results. Let me give you some specifics. Brazilian units sold grew 46%, up from 22% during the fourth quarter of 2015. When looking at gross merchandise volume, the results were equally impressive, accelerating on…

Thank you. Ladies and gentlemen, Our first question comes from the line of Robert Ford of Bank of America. Your line is now open.

Thank you and congratulations on the quarter. I was hoping you could touch a little bit on the acceleration in Mexican revenue growth and maybe some of the accompanying investments you appear to be making in their place. Marcos Galperin - Chairman, President & Chief Executive Officer: Hi, Bob. Thanks. So as we mentioned in the remarks, what we're seeing in Mexico is the growth in the enhanced marketplace. We're seeing incremental date rate and incremental revenues coming from Pago growth, credit growth, shipping as well. And that's what's generating that revenue growth that's so robust and it's even stronger than the growth we're seeing in GMV. The investments are a combination, as is always the case with our financial model; those businesses generate a lower gross margin profile. We're also investing in marketing there as we feel increasingly better with the service and the platform we have. And Mexico has been looking increasingly better for us over the last few quarters. So let's hope we can continue to deliver on the improvements on the user experience and that will continue to drive the business.

Great. Thank you very much. And then in the press release you mentioned some of the enhancements that you're making to payments in terms of the user experience and functionality off-platform and I was wondering if you or Osvaldo could expand on that a little bit please. Osvaldo Giménez - Executive Vice President - MercadoPago, Payments: Hi Bob, this is Osvaldo. Mostly what has happened in terms of off-platform growth, particularly in Brazil is a big migration from our users from our regular checkout to their open platform checkout, which means it is developed by them and connected to us through our API or SDK. That has driven a big part of the growth in Brazil particularly. With regards to the Spanish speaking countries I think that most of the gains have come mostly from improving our flood prevention effort. Outside of Argentina where we're already at a very good level and that has improved our conversion rates. That has helped us gain share in most of the Spanish speaking countries.

That's very helpful. Thank you very much.

Thank you. Our next question comes from Ross Sandler of Deutsche Bank. Your line is now open.

Hey guys, congrats on the quarter. Pedro maybe just a little bit of color on the massive acceleration in unit growth despite the macro? Just I need more help, I know it's the enhanced marketplace but the buyer growth was a little bit faster than the previous cadence. So any more color there? And I guess it's related to that question but is the relationship between buyer growth, which I think you said was 23% and unit growth, is that the same right now as it has been over the last couple of years like, I think in 2015 you had 7% buyer growth and mid-20s unit growth. Is frequency going up or down as you kind of get bigger and you get more selection on the platform? Thank you.

Sure, Ross. So we've consistently said over the years that macro is not really a strong driver of our business given how early stage internet continues to be. And I think to a large degree, that thesis has been playing out over the last few quarters. It's more about innovating on behalf of customers and just improving the user experience as a whole and that's really what we're seeing now. The more penetration we've driven of the different services, the businesses really began to accelerate and I think there's a bit of a positive domino effect there. There's one other side-note is if you look at the Q1 comp in Brazil, it was low growth last year, so that also helps a little bit. But more than anything as we've been saying over the last few quarters, it's really about growing the ecosystem and delivering a better user experience. And then on user engagement and new buyers, what we've been seeing over time is increased user engagement metrics, so if we look at units purchased per buyer, that's been consistently going up. We've also seen growth in new buyer this quarter, so when you combine better engagement metrics from the repeat cohorts with the growth in new buyers is part of the reason why we get this very very strong acceleration in units sold over the quarter.

Thank you. Our next question comes from the line of Tom Champion of Cowen. Your line is now open. Thomas Champion - Cowen & Co. LLC: Thank you for taking the question and congratulations. Similar line of questioning, just if you could elaborate anything more on the strengths that you're seeing in Brazil, I guess it seems like Brazil has been an area where you've innovated first in developing some of your newer buying policies and I'm wondering if you're seeing benefits from those changes that were made last year and whether you're going to see maybe a similar type improvement as you roll those changes out in other geographies. And then just second, the tax rate was a little bit lower than we were modeling. I'm curious if 1Q is kind of a guide for what we should think about for the rest of the year. Thanks very much. Marcos Galperin - Chairman, President & Chief Executive Officer: Sure. So I think it was maybe covered in the previous answer. We strongly believe in the power of the combined ecosystem of greater selection, better user experience, easier to pay, more credit accessible, reliable and predictable shipping at ever increasingly lower prices as the secret to driving growth. And as you mentioned, Brazil was the first country where we've seen high penetration rates of that combined ecosystem and I think we're seeing the results of that now. When I answered the Mexico question earlier, we attribute a very strong part of the pick-up in Mexico from the same thing. We have shipping penetration that's now at about a third of all units sold. We're seeing Pago grow consistently towards about half of all GMV and that really generates a much, much better book buying and selling experience. So I think our anticipation is that, yes, as we roll out the full ecosystem in all our markets over time, that should help our business overall. And that's been the strategic vision we outlined about three years ago and have been executing diligently on over time. On the tax rate, so the tax rate in the quarter was lower, in part driven by the Argentine Software Law that we've become – that we are a part of and benefits our tax rate in Argentina. We also had lower overall pre-tax income this quarter which helped a little bit. And then finally, there also are some Venezuelan loss carry forwards that lowered the rate, the blended rate, during the quarter. So it's not necessarily a rate that will be sustained every quarter of the year. We typically encourage you to look at the tax rates on an annual basis to get a sense. And I think what we've been saying is somewhere in the high 20s is probably where it should come in for the full year. Thomas Champion - Cowen & Co. LLC: Thank you.

Thank you. Our next question comes from Michel Morin of Morgan Stanley. Your line is now open. Michel Morin - Morgan Stanley & Co. LLC: Thank you. So Pedro, was wondering if you could share with us the growth rates for marketplace and non-marketplace by country. I think you gave Brazil in the release, but it would be great to especially for Mexico, given the acceleration there. And then I just wanted to come back to Mexico and your comment about how you're benefiting from the enhanced marketplace and tying that in also with macro because I think on macro you've said, you just repeated that you haven't really been seeing an impact. I think your competitors have been seeing an impact in Brazil from macro. So the question there is, now that you're getting to very elevated levels of penetration for shipping and for on-platform in Brazil, is there reason to worry that the growth there could start to slow as you no longer get the incremental benefits from that enhanced marketplace? Or is it become a kind of self-sustaining virtuous circle, if you will? Thank you.

Great. Hi Michel. So let me start with the second one. And then I'll get back. We don't comment on our competitors. I think we try to remain focused on our business and how we're doing and our innovation. However, I think your question regarding is there a comp issue here and what happens in the larger markets when you already begin to comp the roll out of the full ecosystem. And just a little bit of data behind that. Predicting future performances is not something we do. But if you look at the last year Q1, Pago was already penetrated in the high 80s in Brazil. So it's not like we're comping against a quarter where the ecosystem was still under-penetrated on the payments front. And if we look at shipping it was at slightly below 50% Q1 of last year. So I think that shows that obviously, when you have a tougher comps because of the full ecosystem having rolled out that could play a part in where your growth rates look like. But they definitely don't seem to be what explains the strength of the Brazilian business because we're already comping against a year where the ecosystem in Brazil was fairly developed. On the growth rates, let me give you some call-outs here. So Argentina core grew at – these are all FX Neutral at 66% and non-marketplace at 91%. Mexico core at 11% and non-marketplace 107% and Brazil grew at core 46%, non-core 66%. Those are the growths in the major geographies. Michel Morin - Morgan Stanley & Co. LLC: Perfect. Thank you very much Pedro.

Thank you. Our next question comes from Steven Ju (32:35) of Credit Suisse. Your line is now open.

Hey, guys. So I guess the volume questions I got addressed to some degree. So I'll ask the churlish monetization question. So I know the take grade is an output metric for you guys but can you go through some of the present takes (32:50) in terms of insertion, BD creases (32:52) or offsets in Advertising. And I'm wondering if you can tell us what percent of world revenue is your PLA ad unit. Thanks.

Great. So the first question on take-rates just directionally if we'd look at total MELI Q-on-Q, it was practically flat, very, very slightly down. When you break that down to understand what's happening on a geographic level, really all country take-rates are up with the exception of Brazil. Brazil is down by nearly one percentage point sequentially Q-on-Q. That's driven primarily by a slowdown in the take-rate from two non-marketplace businesses, our financing business where spreads have tightened somewhat and we haven't passed those on to the sellers, so we've made a lower take-rate on financing in Brazil and also Shipping, as I mentioned had some contra-revs this quarter that we've corrected and shouldn't be an issue going-forward the remainder of the year. But that also lowered some of the Brazilian non-core marketplace take-rates. And then when we look at the core marketplace take-rate in Brazil, it's actually been flat Q-on-Q sequentially, so we continue to be able to manage that transition away from placement fees towards final value fees fairly efficiently as we had intended. So really, the oscillations in take-rate have been primarily Brazil, non-marketplace. Then the second part of your question. The Advertising business represents roughly, it's in the range of 5%, let me give you the exact number. It's slightly below five, and the new POAs are about half of that, so growing very well along with the whole Advertising business. But still not moving the needle in terms of the consolidated numbers.

So it looks like you've stepped up some of your marketing activity this quarter, presumably that's small enough direct response size. So is there something going on in terms of RY (35:37) benefits that you might be realizing that this quarter you decided to step up some of the marketing there? Thanks.

So in general, when you look at the marketing spend an important driver of the margin change is actually buyer protection. So when we pay out in the case of – buyers receiving items different than described, or even in the cases of shipping, we reimburse shipping costs if there's delay on shipment. So we think that's a good investment in essentially paying users when the user experience is not what we want it to be. We have growing confidence in our ability to deliver a good user experience, and when it doesn't happen we're increasingly willing to pay for that. So there is margin contraction on the marketing line that comes from buyer protection. And then in terms of actual customer acquisition what we're seeing is some ramp up year-on-year, about 70 bits (36:49) that are coming from that, but it's not significant. And that's just as we're more comfortable with customer lifetime values and we see the improvement in the overall engagement metrics, we're willing to put more money behind customer acquisition.

Thank you.

Thank you. Our next question comes from Gene Munster of Piper Jaffray. Your line is now open. Eugene Charles Munster - Piper Jaffray & Co. (Broker): Good afternoon and my congratulations. Question is, looking at the unit growth is there just a rough idea of what ecommerce is growing at in maybe, Argentina and Brazil so we can get a sense of what market share gains are? And separately, Pedro you talked a little bit about investment. I think some investors have been critical about your levels investment suggesting that you shouldn't invest more, but those investments are paying off that you are doing. But how do you think over the next year or two about the potential (37:52) more significant increase in investment in different – many different opportunities that you have and just to give investors some sense of how you're thinking about capital allocation. Thank you.

Great. So Brazil is probably the market where you have the most public companies and you have the largest data set to attempt to measure what the ecommerce market is growing at. Most of the reputable sources we've seen pegged market growth anywhere between high single-digits and mid-teens – the most optimistic case. So definitely, market share gains in Brazil this quarter have been phenomenal. It's something that... Eugene Charles Munster - Piper Jaffray & Co. (Broker): And remind me, Pedro, what was Brazil gaining throughout again?

Sure. So Brazil unit growth was 46% this quarter and FX Neutral – so growth in GMV and Reais was 61%. So really very, very strong and significantly outpacing where most analysts have pegged the market. Argentina is harder. It's a smaller data set. No other public companies. But if you look at our Argentine growth rate, 77% GMV and pesos, 53% in units. We're quite confident that we continue to gain share in Argentina as well. In terms of capital allocation, again there's always when we look at the margin structure remind you that the most significant contraction in EBIT is actually coming from gross margin contraction. We continue to have these great businesses that are synergistic that we think have huge opportunities beyond the marketplace like Payments processing, like Credit. They just happen to be lower gross margin business. They're accretive gross profit. And so it's not something that worries us too much from a margin perspective. In terms of the actual OPEX expenditures, if you look at total expenses, total expenses have been affected by FX as well. So there's been significant margin compression year-over-year. But when we think going forward capital allocation is going to continue being – more engineers that we need to build out all of these opportunities. We'll need incremental head count to manage these businesses. And on the CapEx front for the foreseeable future, no significant change. The only area that we could potentially get interested in is in the logistics space. But if we were to do that, we'll make sure to communicate in advance. And it will be because we're confident that it makes sense for the long-term. So I think you've kind of seen the trends in the financial model that you should expect going forward in terms of what happens with gross margin, at least for the foreseeable future as we continue to grow payment and all the different business lines that are emerging from it. We continue to penetrate Shipping. And then in OPEX, I think our ramp up is, as we've said, should be similar. Somewhere in the few hundred basis points of investment for this year. Eugene Charles Munster - Piper Jaffray & Co. (Broker): Okay. Thank you.

Thank you. And at this time, I'm sure there are no further participants in the queue. I'd like to turn the call over to management for any closing remarks.

Great. So thank you, everyone. As we said in the prepared remarks, very strong quarter. We're very pleased with the way the year started out. And we look forward to reporting back to you as we advance in 2016. Thank you.