Mastercard Reports Higher Earnings, Sets Aside $225 Million for Litigation Costs
July 26 2018 - 9:48AM
Dow Jones News
By Allison Prang
Mastercard Inc. reported an increase in profit in its latest
quarter as the value of card transactions rose by about 15%, with
Europe outperforming compared with other markets.
The company set aside $225 million during the quarter for
litigation costs with merchants in the U.S. and the U.K. Mastercard
said $210 million of the money it set aside was for U.S.
merchants.
The Wall Street Journal reported late last month that both
Mastercard and its competitor, Visa Inc., were near settling a
lawsuit from merchants related to credit-card fees. A group of
credit-card companies -- including Mastercard and Visa -- would pay
around $6.5 billion to merchants.
The credit-card company's profit rose 33% to $1.57 billion, or
$1.50 a share, compared with $1.18 billion, or $1.10 a share a year
earlier. On an adjusted basis, Mastercard reported earnings of
$1.66 a share, beating estimates from analysts polled by FactSet of
$1.53 a share.
Net revenue rose 20% to $3.67 billion. Expenses rose 24% to
$1.73 billion.
Gross-dollar volume for the company's credit, charge and debit
programs rose 15.3% world-wide to $1.48 trillion, beating analysts'
expectations of $1.46 trillion. It rose the most in Europe,
increasing 21.6%.
Shares, up 41% year to date, fell 2.5% premarket.
Write to Allison Prang at allison.prang@wsj.com
(END) Dow Jones Newswires
July 26, 2018 09:33 ET (13:33 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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