UNITED STATES | MasterCard the second-biggest U.S. payments network, posted a first-quarter profit that beat analysts’ estimates as customer spending climbed.
Net income increased 12 percent to $766 million, or $6.23 a share, from $682 million, or $5.36, a year earlier, the Purchase, New York-based company said Wednesday in a statement. The average estimate of 33 analysts surveyed by Bloomberg was for $6.17 a share.
MasterCard, led by Chief Executive Officer Ajay Banga, doubled its dividend and authorized a new share-repurchase program during the quarter as a global consumer shift from cash and checks to electronic payments continues unabated. Spending on the network grew faster last year than at larger competitor Visa Inc., which lost market share as news U.S. limits on debit- card transaction fees and processing took effect.
“We delivered solid performance that met our expectations despite the mixed global economic environment,” Banga, 53, said in the statement. “Since the start of the year, we have had steady momentum in new business, as well as product innovations.”
MasterCard has climbed 13 percent this year, outpacing the 5.1 percent gain for the 70-company Standard & Poor’s 500 Information Technology Index. Shares advanced 2.6 percent yesterday to close at an all-time high of $552.93.
Visa, whose shares have advanced 11 percent in 2013, is scheduled to report fiscal second-quarter results later today. The Foster City, California-based company may say net income fell 7 percent to $1.2 billion, according to the average estimate of 21 analysts in a Bloomberg survey.
American Express Co. (AXP), the third-biggest U.S. network, and No. 4 Discover Financial Services (DFS), both said last month that first-quarter profits rose as customer card spending increased.
Article sourced from BusinessDayOnline.com