Mastercard reported stronger-than-expected quarterly results as spending continued to hold up across income groups, offering a fresh indication that higher living costs have not yet caused a broad pullback in consumer activity.
Shares of Mastercard rose more than 4% on October 30 after the company reported the results. The move followed quarterly adjusted earnings of $5.31 per share, above the $5.16 expected by Wall Street, while revenue increased 14% to $9.8 billion.
Payment volumes continued to expand
Mastercard said purchase volume increased 9% during the quarter. Cross-border volume, which includes spending by customers outside their home markets, grew even faster at 11%. International travel and related spending remained an important source of activity, according to the results.
Adjusted net income rose 17% to $4.7 billion. The figures point to continued transaction growth for the payments network at a time when investors have been watching for evidence that inflation and elevated household expenses are weakening demand.
| Measure | Quarterly result |
|---|---|
| Adjusted earnings per share | $5.31 |
| Revenue | $9.8 billion, up 14% |
| Adjusted net income | $4.7 billion, up 17% |
| Purchase volume | Up 9% |
| Cross-border volume | Up 11% |
Spending strength was not uniform
The results indicated that spending patterns differed by household income. Lower-income consumers continued to purchase staples, while wealthier households maintained spending on vacations and other discretionary categories. That combination supported Mastercard's overall transaction volumes and helped explain the share-price reaction after the announcement.
However, the growth in spending does not necessarily represent a comparable increase in the amount of goods and services being purchased. Some of the higher transaction values reflected price increases, including more expensive fuel, rather than a greater quantity of goods bought by consumers.
- Purchase volume increased 9%.
- Cross-border volume rose 11%, supported by travel-related activity.
- Adjusted earnings exceeded the Wall Street estimate cited in the results.
Mastercard's figures therefore provide evidence of continued consumer durability, but they also preserve an important distinction between nominal spending and underlying demand. Persistent inflation could still place additional pressure on household finances, while the quarter's data show that such pressure had not yet produced a widespread contraction in spending.
