Why did Mastercard's net profit fluctuate in Q2 2024?

Mastercard's net profit fluctuated in Q2 2024 due to several factors:

1. Revenue Mix and Operating Expenses: The increase in operating expenses, such as payment network rebates and incentives, which escalated by 20% year-over-year, partly offset the positive effects of resilient consumer spending and solid cross-border volumes. This suggests that while the company is benefiting from strong transaction volumes, the additional costs associated with these rebates and incentives can impact net profitability.
2. Foreign Currency Translation Adjustments: Mastercard's financial statements were impacted by foreign currency translation adjustments, resulting in a net loss of $103 million compared to a gain of $24 million in the previous year. This indicates that the company is sensitive to currency fluctuations, which can significantly affect net profit figures.
3. Legal and Regulatory Scrutiny: The company faced ongoing legal and regulatory scrutiny, reflected in the increased provisions for litigation to $126 million. Such legal challenges can lead to additional costs and uncertainty, potentially affecting net profit margins.

In summary, Mastercard's net profit fluctuation in Q2 2024 was likely a result of a combination of factors including revenue mix and operating expenses, foreign currency translation adjustments, and legal and regulatory scrutiny.