Mastercard exceeds Q4 expectations driven by robust consumer spending and cross-border growth
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Global payment solutions provider Mastercard (MA) announced strong earnings and revenue growth in the fourth quarter of 2023, surpassing analysts' consensus estimates . Excluding non-recurring items, the company reported earnings of $3.18 per share, $0.10 better than the consensus of $3.08. Revenues saw a significant increase of 12.6% year-over-year, reaching $6.55 billion, surpassing the $6.46 billion consensus.
Mastercard's solid performance during the quarter was attributed to a 10% growth in gross dollar volume and a 11% increase in purchase volume on a local currency basis.
The payment network net revenue grew by 9% (7% on a currency-neutral basis) due to factors such as a 10% growth in gross dollar volume on a local currency basis, 18% growth in cross-border volume on a local currency basis, and 12% growth in switched transactions.
Value-added services and solutions net revenue witnessed a 19% increase (17% on a currency -neutral basis) driven by the continued growth in cyber and intelligence solutions, fraud and security solutions, identity and authentication solutions, as well as marketing, data analytics, consulting, and loyalty solutions.
To support its growth initiatives and drive innovation, Mastercard has made strategic investments in personnel and other areas. This resulted in a 21% increase in total operating expenses. Excluding the impact of Fourth Quarter Special Items, adjusted operating expenses grew by 10% (9% on a currency-neutral basis) primarily due to higher personnel costs.
Commenting on the impressive results, Michael Miebach, CEO of Mastercard, said, We delivered strong earnings and revenue growth for the full year 2023, driven by healthy consumer spending, cross-border volume growth of 24%, and the solid execution of our strategy. The company's robust performance in the fourth quarter of 2023 reflects its resilience and adaptability to the evolving landscape of global payments, which is in part attributed to the healthy consumer spending and the successful execution of its strategic initiatives.
Mastercard's earnings report for the fourth quarter of 2023 highlights its strong financial performance and strategic execution. With impressive revenue growth, driven by increased payment network activity and the success of value-added services and solutions, Mastercard has demonstrated its ability to thrive in a competitive market. The company's commitment to operational excellence and investment in talent positions it for continued success and ensures it remains at the forefront of the rapidly evolving payment industry. Investors can find assurance in Mastercard's robust financial performance and its strategic approach to capitalizing on emerging opportunities.