Mastercard beats earnings estimate as consumer spending holds and cross-border transfers rise
Consumer spending holding strong and a jump in cross-border payments helped Mastercard beat analyst’s earnings estimates for the last quarter, the company said today.
At $2.62, Mastercard’s earnings per share was slightly higher than analyst estimates, while profit rose six percent in the period to $2.5bn, matching expectations, the firm said in its quarterly earnings report.
The payments processing giant also matched analyst estimates on revenue too, recording $5.8bn in revenue, up 12 per cent on last year.
The increase was a result of a 31 per cent rise in cross-border trasnactions and an eight per cent increase in domestic transactions.
This helped to offset a ten per cent increase in operating expenses from higher personnel costs. The higher costs were a result of continuing investments across payments, services and network capabilities, the company said.
“We closed out the year with strong financial results and notable wins which will help us capitalize on the tremendous secular shift to digital payments,” Michael Miebach, Mastercard’s chief executive, said.
“As we look at the broader economy, we see the continued recovery of cross-border travel, with volumes up 59 per cent versus a year ago and we’re encouraged by Asia opening up further,” he said.
“While macroeconomic and geopolitical uncertainty persists, consumer spending has been remarkably resilient. We are well prepared to adjust our investment profile quickly if needed,” he added.
Visa will also outline how it performed between October and December last year, after US markets close.
Wall Street expects Visa’s earnings to increase 11 per cent to $2.01 per share, and post a nine per cent jump in revenue to $7.7bn.
In the previous quarter, its earnings rose to $1.86 per share while revenue grew 19 per cent to $7.8bn on the same period in 2021.
Mastercard and Visa shares were both up slightly in premarket trading.