Mastercard Posts Nearly $350M Profit in 2Q

MasterCard Inc. said Thursday that it booked a profit of nearly $350 million during the second quarter, exceeding Wall Street's expectations.

Shares soared more than 7 percent in premarket trading following the report.

The Purchase, New York-based credit card and global payments processor earned $348.9 million, or $2.67 per share, in the period ended June 30. That compares with a loss of $746.7 million, or $5.70 per share, in the same period a year earlier.

Results in the year-ago period were weighed down by a $1.65 billion charge related to a litigation settlement.

Revenue climbed nearly 3 percent to $1.28 billion.

Both profit and revenue came in ahead of analyst estimates. On average, analysts projected earnings of $2.42 per share on revenue of $1.25 billion, according to a poll by Thomson Reuters.

MasterCard said higher revenue was driven by pricing changes, an increase in the number of transactions processed and a decrease in rebates and incentives.

These factors were partially offset by lower gross dollar volumes. Gross dollar volume was down 0.6 percent to $595 billion on a local-currency basis compared with the second quarter of last year. Worldwide purchase volume fell 0.7 percent to $450 billion.

The number of transactions processed increased 7.9 percent to 5.6 billion, MasterCard said.

Excluding special items, total operating expenses declined 13 percent to $722 million as the company cut back on advertising and marketing and general and administrative expenses such as travel. Favorable foreign currency fluctuations also contributed to the decline in expenses.

MasterCard shares advanced $13.45 to $202 ahead of Thursday's market open. They have ranged from $113.05 to $272 over the past year.

MasterCard's results come one day after an upbeat report from rival Visa Inc., which said its fiscal third-quarter profit jumped nearly 73 percent as cost-cutting helped offset declining payment processing volume.

[curiously1]

I don't know if this is good news for anyone other than Master Card. How many jobs does this increase in profit create?

[alien_view]

Libs give the Credit Card Companies card blaunch and let them raise intrest rates to to the ceiling, knowing that many Americans who are out of work due to the Liberal Screwup of our Economy, are going to live on their credit cards with no hope of every paying them back. How much payback from the Credit Card companies is going back to the Obama administration corruption corps. Believe it or not there used to be the day when Credit Card companies could not charge more than 19% interest, but now with our corrupt government they can do what ever they want to whomever they want and have made it almost impossible to file for bankrupcy.....Enjoy your new Marxist Socialist government that you idiots voted for. Enjoy being out of work, loosing your homes and being in debt forever and giving the federal government control over you. Welcome to the old Russia with it's Marxist Media outlets. No wonder why the russians would not shake Obama's hand....oh, thats right the Media will not let you see the actual TV footage of the event, Obama does not want you all to see it. He wants you idiots believing all is ok and running smoothly. Wake up idiots...

[betterusa]

Has anyone else noticed that most Visa and MasterCard lenders are raising their APR from the normal 8-13% to over 25%? Only a few years ago these card companies were giving their cards away with no interest rates or a very minimal rate. The normal person used them with the lower rates but now purchases made at the low rates are costing 2 to 3x as much in interest.

Where is our Congress to stop this loan shark mentality?