Mastercard Tops Estimates on Card Spending, Fees and Crypto

Mastercard reported $4.35 in earnings per share and net income of $3.9 billion for the quarter ended March 31. Net revenue rose about 14% to $2.18 billion, above analyst expectations of roughly $2.14 billion.

Global purchase volume increased 10% on a local currency basis to $759 billion, while U.S. purchase volume climbed 9% to $268 billion. Gross dollar volume grew 7% in local currency terms to $2.7 trillion. Cross-border volume rose 13% and switched transactions were up 9%.

Payment network net revenue increased 12% year over year (8% on a currency-neutral basis). Mastercard’s value-added services and solutions unit, which includes security, digital authentication, business insights and consumer engagement services, logged a 22% rise in net revenue (18% currency-neutral). Payment network rebates and incentives rose 23% (19% currency-neutral) as the company implemented new and renewed customer agreements.

Total operating expenses were up 13% from a year earlier, driven mainly by higher general and administrative costs and a restructuring charge in the quarter. Excluding special items, adjusted operating expenses increased 11% (9% currency-neutral). Other income and expense improved by $23 million versus the prior year, supported by government grant agreements and partly offset by larger net losses on equity investments. The effective tax rate was 19.3%.

Mastercard highlighted developments in digital payments and crypto. In March the company agreed to acquire stablecoin firm BVNK for up to $1.8 billion. It also said it is expanding work with Circle and Binance and rolling out merchant-facing products such as Mastercard Agent Pay. Michael Miebach, Mastercard’s chief executive, highlighted the company’s expansion of Agent Pay and its planned BVNK acquisition as extensions of its stablecoin and merchant offerings.

The company cited a global survey showing U.S. consumer sentiment rose sharply in the first quarter and that confidence improved in several eurozone countries with high debt levels. Mastercard said those trends supported higher card usage across stores, travel and online checkouts.

The company did not mention Russia in its quarterly statement. Shares slipped about 2.1% in premarket trading and were down roughly 11% year to date, compared with a gain for the S&P 500.

As of March 31, customers had issued 3.7 billion Mastercard and Maestro-branded cards worldwide. The firm said it continued to push products and services focused on security, authentication and merchant engagement, which contributed to the quarter’s revenue growth.