DOW JONES NEWSWIRES
MasterCard Inc. (MA) reversed a prior-year loss in the third quarter caused by its antitrust settlement with Discovery Financial Services (DFS) as the company saw processed transaction jump.
MasterCard's shares rose 3.3% to $230.01 in premarket trading as results topped expectations. The stock through Monday was up 56% this year.
Chief Executive Robert Selander said MasterCard saw signs of stabilization in parts of the company's business.
"Total processed transactions continued to grow at a high single-digit rate, with double digit growth coming from our Asia/Pacific/Middle East/Africa and Latin America regions," said Selander. He added the U.S. showed a lower rate of decline in the quarter.
The company and larger rival Visa Inc. (V) are insulated from credit problems because they make their money off transactions fees they charge banks rather than lending.
MasterCard reported earnings of $452.2 million, or $3.45 a share, compared with a year-ago loss of $193.6 million, or $1.48 a share. Excluding litigation and other items, earnings rose to $3.48 a share from $2.46 a share.
Revenue increased 2% to $1.36 billion and rose 3.9% on a constant currency basis.
Analysts surveyed by Thomson Reuters expected earnings of $2.94 a share on revenue of $1.35 billion.
Worldwide gross dollar volume, or spending on MasterCard-branded cards, rose 0.4% in local-currency terms. The number of MasterCard-branded cards worldwide was about even but the number of processed transactions grew 7.6%.
Last week, Visa reported it swung to a fiscal fourth-quarter profit as last year it was hurt by steep litigation charges, masking another decline in payments volume.
-By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com