Global payments company Mastercard’s second-quarter net profit surged by nearly 22 per cent on an annual basis, driven by increased consumer spending and recovery in global tourism.
The New York-based company’s net profit jumped to $2.8 billion in the three months to the end of June. It was up almost 17 per cent on a quarterly basis.
Earnings per share increased 28 per cent to $3, the company said in a statement on Thursday.
Net revenue during the period rose about 14 per cent yearly to $6.3 billion but soared 11 per cent on a quarterly basis.
“Our positive momentum continued this quarter,” said Michael Miebach, Mastercard’s chief executive. “We delivered strong revenue and earnings growth supported by resilient consumer spending, particularly in travel and experiences, and the continued strength in services.”
The company’s total operating expenses increased 5 per cent year on year to $2.6 billion in the last quarter, primarily due to higher personnel costs, while operating income surged 21 per cent to $3.7 billion, Mastercard said
Mastercard's shares, which have jumped almost 17.3 per cent in the past year, rose 0.60 per cent to trade at $402.65 a share on Thursday at 6.35pm UAE time.
The company, which suspended business operations in Russia in March last year due to the Ukraine conflict, said that one of the key drivers of its growth was the surge in cross-border volume that increased 24 per cent yearly in the second quarter.
Gross dollar volume, a key measure of Mastercard's business, surged 12 per cent in the June quarter. GDV represents the aggregated dollar amount of purchases made and cash disbursements obtained with Mastercard-branded cards.
Total purchase volume, representing the aggregate dollar amount of purchases made with Mastercard-branded cards, rose 14 per cent during the period.
The company’s customers had issued 3.2 billion Mastercard and Maestro-branded cards as of June 30.
“Cross-border travel volume showed strong growth again this quarter, reaching 154 per cent of pre-pandemic levels,” said Mr Miebach.
“We had a number of notable wins with key customers as our innovative products and differentiated services position us as a partner of choice.”
Mastercard repurchased 6.5 million shares at a cost of $2.4 billion and paid $541 million in dividends to its shareholders in the second quarter.
The company also said quarter-to-date through July 24, it has repurchased 1.3 million shares at a cost of $497 million, which leaves $6.4 billion remaining under the approved share repurchase programmes.
On Wednesday, Mastercard's rival company Visa reported a 22 per cent yearly jump in its 2023 fiscal third-quarter net profit to $4.2 billion.
It was driven by a surge in payment volumes, cross-border transactions and a greater amount of customers opting to pay with cards instead of cash.
