Mastercard has announced its fourth-quarter earnings, revealing a net income of $2.8 billion, or $2.97 per share. This demonstrates significant growth compared to the year-earlier period, where the company earned $2.5 billion, or $2.62 per share. On an adjusted basis, Mastercard earned $3.18 per share, surpassing analysts’ expectations of $3.08 per share.
The company’s revenue also saw a notable increase from $5.8 billion to $6.5 billion, in line with the FactSet consensus view. Mastercard observed a 10% rise in fourth-quarter gross dollar volume and an 18% increase in cross-border volume, representing international transactions between merchants and customers. Additionally, switched transactions experienced a 12% growth.
CEO Michael Miebach highlighted the positive impact of “healthy consumer spending” on Mastercard’s performance. He also emphasized recent achievements, such as securing a significant deal with a U.S. regulated bank debit portfolio.
Mastercard’s earnings report follows its rival Visa Inc.’s success last week. Visa beat expectations with its own results; however, it generated concern among investors due to a slowdown in some volume metrics during the December quarter and into January. Visa attributed these challenges to weather-related impacts in the U.S.
Mastercard also experienced a slight deceleration, as its overall switched volume growth in the fourth quarter was 11%, compared to 14% in the third quarter. For the first four weeks of January, growth remained steady at 10%. Cross-border volume growth decreased from 21% in the third quarter to 18% in the fourth quarter but remained constant at 18% throughout the first four weeks of January.
Looking ahead to the first quarter, Mastercard expects revenue growth to be at the “low end of low double digits.” Analysts had projected a revenue of $6.4 billion, representing a 12% increase from the previous year.
Don’t miss: Amex’s impressive performance driven by affluent spenders
