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Mastercard Reports Q1 Earnings, Finalizes VocaLink Acquisition

Press Release

  • First-quarter net income of $1.1 billion, or $1.00 per diluted share
  • First-quarter adjusted net income of $1.1 billion, or $1.01 per adjusted diluted share • First-quarter net revenue increase of 12%, to $2.7 billion
  • First-quarter adjusted gross dollar volume up 8% and purchase volume up 9%
  • VocaLink acquisition completed

Purchase, NY — May 2, 2017 — Mastercard Incorporated (NYSE: MA) today announced financial results for the first quarter 2017. “We’re off to a very good start, with strong revenue and earnings growth driven by solid transaction and volume levels this quarter,” said Ajay Banga, Mastercard president and CEO. “We continue to execute well against our strategy, and by completing the VocaLink acquisition, we can now offer an even greater set of payment options to our customers. This deal redefines our opportunities and positions us favorably to capture new payment flows.”

The following additional details are provided to aid in understanding Mastercard’s first quarter 2017 results, versus the year-ago period:

  • Net revenue growth increased 12% both as reported and on a currency-neutral basis, driven by the impact of the following factors:
    • An increase in switched transactions of 17%, to 14.7 billion;
    • An 8% increase in gross dollar volume, on a local currency basis and adjusting for the impact of recent EU regulatory changes, to 1.2 trillion; and
    • An increase in cross-border volumes of 13% on a local currency basis.
    • These increases were partially offset by an increase in rebates and incentives, primarily due to new and renewed agreements and increased volumes.
  • Total operating expenses increased 12%. Excluding the special item, total adjusted operating expenses increased 11% on a currency-neutral basis. The increase was primarily due to continued investments in strategic initiatives, as well as higher advertising and marketing spend.
  • Other income (expense) growth was mainly driven by higher interest expense related to the company’s debt issuance in November 2016.
  • The lower effective tax rate in the first quarter of 2017 was primarily due to a more favorable geographic mix of taxable earnings and a small net benefit from discrete items.
  • As of March 31, 2017, the company’s customers had issued 2.4 billion Mastercard and Maestro-branded cards.

Click here for additional earnings information.

This entry was posted on Tuesday, May 2nd, 2017 at 11:00 am and is filed under On the Wire.


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