We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Mastercard Beats Q1 Earnings on Strong Cross-Border Volume Growth
Read MoreHide Full Article
Key Takeaways
Mastercard posted Q1 EPS of $4.60, beating estimates, with revenues rising 15.8% year over year.
MA saw 13% cross-border volume growth and 22% rise in value-added services revenues.
Operating income rose 19% as margins improved, despite higher expenses and rebates.
Mastercard Incorporated (MA - Free Report) reported first-quarter 2026 adjusted earnings of $4.60 per share, which topped the Zacks Consensus Estimate by 4.6%. The bottom line improved 23.3% year over year.
Net revenues advanced 15.8% year over year to $8.4 billion. The top line beat the consensus mark by 1.3%.
The strong quarterly results benefited from growing cross-border volumes and solid growth in value-added services revenues. However, the upside was partly offset by elevated operating expenses and higher payment network rebates from new and renewed deals.
Mastercard Incorporated Price, Consensus and EPS Surprise
Gross dollar volume or GDV (representing the aggregated dollar amount of purchases made and cash disbursements obtained from Mastercard-branded cards) rose 7% on a local-currency basis to $2.7 trillion. The metric beat the Zacks Consensus Estimate by 1.8%.
Cross-border volumes (a key measure that tracks spending on cards beyond the issuing country) grew 13% on a local currency basis in the quarter under review. Switched transactions, which indicate the number of times a company’s products have been used to facilitate transactions, improved 9% year over year to 43.8 billion. However, the metric missed the consensus mark of 44.2 billion.
Mastercard’s value-added services and solutions continued to be a key contributor to the revenue mix. Value-added services and solutions’ net revenues totaled $3.5 billion, which advanced 22% year over year and surpassed our model estimate of $3.4 billion. The year-over-year growth was aided by pricing and the strong performance of security, digital and authentication solutions, as well as customer acquisition and engagement services.
Payment network rebates and incentives increased 23% year over year as a result of new and renewed deals. Mastercard’s clients issued 3.7 billion Mastercard and Maestro-branded cards as of March 31, 2026.
Adjusted operating expenses escalated 11% year over year to $3.3 billion in the first quarter due to rising general and administrative expenses.
Even with higher costs, operating leverage showed through. Adjusted operating income of $5.1 billion climbed 19% year over year and beat our model estimate of $4.9 billion. The adjusted operating margin improved 150 basis points (bps) year over year to 60.8%.
Mastercard’s Financial Position (As of March 31, 2026)
Mastercard exited the first quarter with cash and cash equivalents of $7.9 billion, which fell 25.2% from the 2025-end level. Total assets of $52.4 billion decreased 3.2% from the figure at 2025-end.
Long-term debt amounted to $17.2 billion, down 5.7% from the figure as of Dec. 31, 2025. Short-term debt totaled $1.7 billion.
Total equity of $6.7 billion declined 13.2% from the 2025-end level.
Mastercard generated net cash from operations of $3 billion in the first quarter of 2026, which grew 26% from the year-ago quarter figure.
Mastercard’s Capital Deployment Update
Mastercard bought back 7.8 million shares for $4 billion in the first quarter. Over the period between April 1 and April 27, it bought back another 3.3 million shares for $1.7 billion, thereby leaving a buyback capacity of $11.7 billion.
MA paid out dividends worth $777 million during the quarter under review.
Mastercard’s Q2 Guidance
Management projects net revenues to register low double-digit growth on a year-over-year basis in the second quarter of 2026, while adjusted operating expenses are anticipated to record low-end of low double-digits growth.
Mastercard’s Revised 2026 View
Management now estimates net revenues to witness high-end of low double-digits to low teens growth in 2026 from the 2025 figure. Adjusted operating expenses are still likely to witness low double-digit growth from the year-ago figure.
Visa Inc. (V - Free Report) delivered second-quarter fiscal 2026 adjusted earnings of $3.31 per share, up 20% year over year and beat the Zacks Consensus Estimate by 7.1%. Net revenues came in at $11.23 billion, rising 17% year over year. V’s quarterly results reflected resilient spending trends, higher cross-border volumes and solid network activity, including a 9% year-over-year increase in payments volume on a constant-dollar basis. However, the upside was partly offset by increased operating expenses.
American Express Company (AXP - Free Report) reported first-quarter 2026 EPS of $4.28, which surpassed the Zacks Consensus Estimate by 6.2% and advanced 18% year over year. Total revenues, net of interest expense, improved 11% year over year to $18.9 billion. AXP’s quarterly results were driven by increased Card Member spending, higher net interest income and improved card fee growth. However, the upside was partly offset by elevated operating expenses.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Mastercard Beats Q1 Earnings on Strong Cross-Border Volume Growth
Key Takeaways
Mastercard Incorporated (MA - Free Report) reported first-quarter 2026 adjusted earnings of $4.60 per share, which topped the Zacks Consensus Estimate by 4.6%. The bottom line improved 23.3% year over year.
Net revenues advanced 15.8% year over year to $8.4 billion. The top line beat the consensus mark by 1.3%.
The strong quarterly results benefited from growing cross-border volumes and solid growth in value-added services revenues. However, the upside was partly offset by elevated operating expenses and higher payment network rebates from new and renewed deals.
Mastercard Incorporated Price, Consensus and EPS Surprise
Mastercard Incorporated price-consensus-eps-surprise-chart | Mastercard Incorporated Quote
Mastercard’s Q1 Operational Performance
Gross dollar volume or GDV (representing the aggregated dollar amount of purchases made and cash disbursements obtained from Mastercard-branded cards) rose 7% on a local-currency basis to $2.7 trillion. The metric beat the Zacks Consensus Estimate by 1.8%.
Cross-border volumes (a key measure that tracks spending on cards beyond the issuing country) grew 13% on a local currency basis in the quarter under review. Switched transactions, which indicate the number of times a company’s products have been used to facilitate transactions, improved 9% year over year to 43.8 billion. However, the metric missed the consensus mark of 44.2 billion.
Mastercard’s value-added services and solutions continued to be a key contributor to the revenue mix. Value-added services and solutions’ net revenues totaled $3.5 billion, which advanced 22% year over year and surpassed our model estimate of $3.4 billion. The year-over-year growth was aided by pricing and the strong performance of security, digital and authentication solutions, as well as customer acquisition and engagement services.
Payment network rebates and incentives increased 23% year over year as a result of new and renewed deals. Mastercard’s clients issued 3.7 billion Mastercard and Maestro-branded cards as of March 31, 2026.
Adjusted operating expenses escalated 11% year over year to $3.3 billion in the first quarter due to rising general and administrative expenses.
Even with higher costs, operating leverage showed through. Adjusted operating income of $5.1 billion climbed 19% year over year and beat our model estimate of $4.9 billion. The adjusted operating margin improved 150 basis points (bps) year over year to 60.8%.
Mastercard’s Financial Position (As of March 31, 2026)
Mastercard exited the first quarter with cash and cash equivalents of $7.9 billion, which fell 25.2% from the 2025-end level. Total assets of $52.4 billion decreased 3.2% from the figure at 2025-end.
Long-term debt amounted to $17.2 billion, down 5.7% from the figure as of Dec. 31, 2025. Short-term debt totaled $1.7 billion.
Total equity of $6.7 billion declined 13.2% from the 2025-end level.
Mastercard generated net cash from operations of $3 billion in the first quarter of 2026, which grew 26% from the year-ago quarter figure.
Mastercard’s Capital Deployment Update
Mastercard bought back 7.8 million shares for $4 billion in the first quarter. Over the period between April 1 and April 27, it bought back another 3.3 million shares for $1.7 billion, thereby leaving a buyback capacity of $11.7 billion.
MA paid out dividends worth $777 million during the quarter under review.
Mastercard’s Q2 Guidance
Management projects net revenues to register low double-digit growth on a year-over-year basis in the second quarter of 2026, while adjusted operating expenses are anticipated to record low-end of low double-digits growth.
Mastercard’s Revised 2026 View
Management now estimates net revenues to witness high-end of low double-digits to low teens growth in 2026 from the 2025 figure. Adjusted operating expenses are still likely to witness low double-digit growth from the year-ago figure.
MA’s Zacks Rank
Mastercard currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
How Are Mastercard’s Peers Placed This Quarter?
Visa Inc. (V - Free Report) delivered second-quarter fiscal 2026 adjusted earnings of $3.31 per share, up 20% year over year and beat the Zacks Consensus Estimate by 7.1%. Net revenues came in at $11.23 billion, rising 17% year over year. V’s quarterly results reflected resilient spending trends, higher cross-border volumes and solid network activity, including a 9% year-over-year increase in payments volume on a constant-dollar basis. However, the upside was partly offset by increased operating expenses.
American Express Company (AXP - Free Report) reported first-quarter 2026 EPS of $4.28, which surpassed the Zacks Consensus Estimate by 6.2% and advanced 18% year over year. Total revenues, net of interest expense, improved 11% year over year to $18.9 billion. AXP’s quarterly results were driven by increased Card Member spending, higher net interest income and improved card fee growth. However, the upside was partly offset by elevated operating expenses.