MasterCard's First Quarter Profit Up 24 Percent, Beating Expectations

NEW YORK (Maria Aspan) - MasterCard Inc's first-quarter profit rose 24 percent, beating expectations, as consumers spent more money on their credit and debit cards.

The world's second-largest card processing network on Tuesday reported a profit of $562 million, or $4.29 per share. That compares with $455 million, or $3.46 per share, in the year-ago period.

Analysts on average had expected MasterCard to earn $4.10 per share, according to Thomson Reuters I/B/E/S.

Revenue rose 14.8 percent from a year earlier, to $1.5 billion, slightly above expectations, as more people around the world used their MasterCards. The company said that worldwide purchase volume during the quarter rose 12.9 percent on a local currency basis.

Chief Executive Officer Ajay Banga in an earnings release cited MasterCard's "solid volume and processed transaction growth," and said the company continues "to launch new products, enter new geographies and open new acceptance channels."

Banga, who took over the company last year, is increasingly turning MasterCard abroad for growth, in the face of U.S. regulation and rival Visa's dominance of the U.S. debit card processing market. The payments industry is hoping to find new sources of revenue through processing mobile or ecommerce payments in developing countries, where most consumers do not already use credit or debit cards.

(Reporting by Maria Aspan; editing by John Wallace, Dave Zimmerman)

Copyright 2011 Thomson Reuters. Click for Restrictions.

Comments

[Francisco Pia]

04:49 PM on 05/20/2011

This is great news on Master Card but it may bee to the fact that more people are turning into eat to fill up at the tank and buy groceries. As the economy worsens and people find themselves in low money situations, they turn to use their credit cards in order to survive. I came across an article at Amex Open Forums that talks about improving the revenue for your business, you should check it out: http://www.openforum.com/articles/3-proven-tactics-to-enhance-your-revenue

[Benjamin Rosenfeld]

02:25 PM on 05/04/2011

Credit cards are evil. Making people believe they have more money than they actually do, we'd all be better off without them. I fell into their trap five or so years ago and I'm still paying it off. Just a few more years, though, around three, and then I'll be freeeeee.............

[Peanut Santiago]

03:25 AM on 05/04/2011

More people are using credit (once again)?

How many of them will be able to pay for all that they charged?
THAT is the question.

[fortressfountain]

09:09 PM on 05/03/2011

Foolishness-1 888 opt out. I got sick of getting the offers since the republicans took over the house.
Using a credit card is supporting terrorism.

[spytheweb]

06:20 PM on 05/03/2011

The last time i used a credit card was June 2001 (got rid of them). I have a debit card but it's free. i don't buy anything on credit.

[twoto2]

03:55 PM on 05/03/2011

Go back!!! Go Back!!! It's alive!!! One of the more memorable lines from the Author who gave you 'The rent's too damn high' From his new book 'The card's too damn big'.

[TOPCAT711]

01:11 PM on 05/03/2011

So many 'whackos' believe that the world will end on May 21st......guess they figure 'why not max out the cards'. They won't be around to pay for it anyway.

May 22nd will be the big 'eye opener'.

[frank day]

12:17 PM on 05/03/2011

No! Folks. NO! Don't do it.

Pay cash and let these sharks drown.

[dc8s]

01:08 PM on 05/03/2011

Right! Are people mad? How soon we forget ...

[MrStat1]

03:45 PM on 05/03/2011

Let them make their own decisions, OK!

[bethel1974]

12:13 PM on 05/03/2011

Of course as the U.S. economy recovers MasterCard and Visa will show improvement due to owning the two largest processing networks. This a symptom of being able to pay bills online, online shopping (which is growing), increased travel. As well you have emerging markets increasing their access to the internet and paying by debit card not credit card. Alot of websites do not take international issued credit cards. MasterCard and Visa will continue growth because of their presence in Brazil and with $100's of billions of dollars are spent in Brazil preparing for the World Cup and Olympics.

[notdarkyet]

11:22 AM on 05/03/2011

I know someone who just declared bankruptcy on 150 thou in credit card debt. People are using them because they have no money and if they can't pay their bills they can just declare bankruptcy.

[Peanut Santiago]

03:29 AM on 05/04/2011

THAT is the question.....how many borrowers will be able to pay back all the money?

I have a feeling we won't have too long to wait until we know the answer.

People are still losing jobs, working for lower salaries, dealing with foreclosures, AND declaring bankruptcy.

[William Brock]

10:27 AM on 05/03/2011

Do people still use these things?

[Trustfunded1]

09:57 AM on 05/03/2011

Gas purchases

People are so broke they can't fill up the car with cash.

[frank day]

12:16 PM on 05/03/2011

I think you are correct!