MasterCard Results Top Expectations as Transactions Grow
July 28 2016 - 9:30AM
Dow Jones News
MasterCard Inc. said profit and revenue grew in the second
quarter as transactions increased at the credit card company.
Results topped expectations, and shares climbed 1.8%
premarket.
Like fellow card company Visa Inc., MasterCard charges fees to
financial institutions for transactions that travel over their
networks. Card companies have been shelling out in bids to attract
new customers and increase transactions.
Purchase, N.Y.-based MasterCard said transactions rose 14%
during the quarter but said that was partly offset by higher
rebates and incentives.
Operating expenses increased 15% to $1.31 billion in the
quarter, due to higher general and administrative, marketing and
legal expenses.
In all, MasterCard reported a profit of $983 million, or 89
cents a share, up from $921 million, or 81 cents, a year prior. On
an adjusted basis, earnings per share were 96 cents. Revenue rose
13% to $2.69 billion. Analysts polled by Thomson Reuters expected
90 cents in per-share profit on $2.59 billion in sales.
MasterCard is expanding from the traditional physical credit and
debit cards as its customers move to digital formats. MasterCard is
expanding its Masterpass digital payment platform to let shoppers
use the service on their mobile phones at store check-out
terminals, creating another rival to Apple Inc.'s Apple Pay and a
number of other mobile-payment products.
Earlier this month, MasterCard said it was buying most of
VocaLink Holdings Ltd., a bank-owned technology company in the U.K.
that provides the backbone for non-card transactions such as
employer payroll deposits and consumer bill payments, for about
$920 million.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
July 28, 2016 09:15 ET (13:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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