New York: Mastercard shares fell after the payments network predicted revenue growth for the coming quarter that undercut analyst forecasts, even as consumers continued to weather rising rates with robust spending on their cards.
The company expects to post net revenue growth in the low-double digits for the remainder of the year, lower than the 14 per cent analysts predicted for the period. Still, purchase volume on the firm’s cards surpassed analyst forecasts for the third quarter, rising 12 per cent to $1.88 trillion for the three months ended September 30, Mastercard said in a statement.
Shares of Purchase, New York-based Mastercard fell about 3 per cent at 9:34 am in New York.
“We delivered strong revenue and earnings growth again this quarter, reflecting the solid fundamentals of our business and the continued resilience in consumer spending,” CEO Michael Miebach said in the statement. “While macroeconomic and geopolitical uncertainty remains elevated, our diversified business model positions us well to capitalize on the substantial opportunities in payments and services.”
Consumers have so far bucked analysts’ expectations, spending more on travel and entertainment even amid rising rates and the threat of an economic slowdown. Mastercard said cross-border volumes increased 21 per cent, reflecting robust travel and non-travel cross-border spending. Rival Visa reported quarterly profit that beat Wall Street estimates this month.
Mastercard’s operating expenses ticked up about 2 per cent to $2.7 billion from a year earlier amid acquisitions and higher personnel costs, though that was lower than analysts predicted. The company expects fourth quarter operating expense growth at the high-end of high single digits, it said.
Mastercard also reported $3.2 billion in net income for the quarter and earnings per share of $3.39 cents, surpassing analyst expectations.