Categories Earnings, Finance, LATEST

Mastercard stock falls despite Q2 earnings beat

A marked increase in revenues lifted Mastercard’s (MA) earnings, which surpassed analysts’ forecast in the second quarter. However, shares of the payment services provider slipped from an all-time high following the announcement Thursday amidst concerns over the continuing squeeze on portability from rising expenses.

Adjusted earnings were $1.7 billion or $1.66 per share, higher than $1.2 billion or $1.10 per share recorded in the second quarter of 2017. Earnings came in above estimates.

Mastercard Q2 earnings beat estimates
Mastercard Q2 2018 earnings infographic

On an unadjusted basis, earnings of the New York-based financial services provider rose to $1.50 per share from $1.10 per share a year earlier. While the bottom line benefitted from a 20% rise in revenues, a sharp increase in operating expenses restricted the growth.

At $3.7 billion, revenues were slightly above Wall Street estimates. The upturn is attributable to an increase in switched transactions, cross-border volumes and gross dollar volume, which was partially offset by higher rebates and incentives. Excluding the effect of the new revenue recognition rules and acquisitions, revenue increased 14%.

Revenues benefitted from an increase in switched transactions, cross-border volumes and gross dollar volume

“We continue to invest for the long term and are pleased with the progress we are making in expanding our customer relationships and advancing our secure digital solutions. We believe our strategy of providing choice to our customers positions us well to expand our core business and address new opportunities,” said Mastercard CEO Ajay Banga.

RELATED: Visa Q2 Earnings beat estimates

During the three months ended June, Mastercard repurchased around 8.3 million shares for $1.5 billion.

The company has been quite successful in closing the gap with rival and industry leader Visa (V) in recent years, taking advantage of the new opportunities being offered by the payment solutions sector.

RELATED: Mastercard Q2 2018 earnings call transcript

After gaining 41% since January, Mastercard stock ended the last trading session at a record high but lost nearly 3% in early trading Thursday following the earnings release.

RELATED: Mastercard stock climbs on upbeat Q1

Mastercard Q1 2018 Earnings

Most Popular

Earnings Preview: What to look for when Broadcom (AVGO) reports Q1 results

Broadcom, Inc. (NASDAQ: AVGO) will be releasing its first-quarter results next week. Over the years, the company constantly broadened its portfolio beyond semiconductors to areas like enterprise software solutions, a

Here’s a look at Lowe’s (LOW) expectations for the near term and ahead

Shares of Lowe’s Companies, Inc. (NYSE: LOW) were up over 1% on Friday. The stock has gained 19% over the past three months. The home improvement retailer saw sales and

TJX Companies (TJX) Q4 2024 profit jumps on strong revenue growth

The TJX Companies, Inc. (NYSE: TJX) has reported a double-digit increase in net income for the fourth quarter of 2024 when the fashion retailer's net sales grew 13%. Fourth-quarter sales

Add Comment
Viewing Highlight