Payment card processor MasterCard Inc. (MA) reported Thursday a sharp decline in fourth-quarter profit, as it recorded $495 million charge for the settlement of U.S. Merchant litigation. On a per share basis, adjusted earnings topped analysts' expectations. Revenues grew about 20 percent on improved volumes and matched Street view. The company's shares rose more than 5 percent in the morning trade on the NYSE.
In the fourth quarter, net income attributable to the company dropped to $19 million or $0.15 per share from $415 million or $3.16 per share a year earlier. Recent-quarter results included a $770 million pre-tax charge, or $495 million on an after-tax basis, related to the U.S. merchant litigations.
Excluding item, the company reported net income of $514 million or $4.03 per share. On average, 32 analysts polled by Thomson Reuters expected the company to earn $3.91 per share for the quarter. Analysts' estimates typically exclude one-time items.
Net revenues for the quarter improved 20.2 percent to $1.73 billion from $1.44 billion in the preceding year, which was also in line with analysts estimates. On a constant currency basis, net revenue rose 20.8 percent from last year.
The company attributed the increase in revenues to a 17.5 percent rise in cross-border volumes, a 16.3 percent increase in gross dollar volume on a local currency basis and a 23.2 percent growth in processed transactions.
Worldwide purchase volume during the quarter improved 15.2 percent on a local currency basis to $648 billion. The company noted that as of December 31, 2011, its customers had issued 1.8 billion MasterCard and Maestro-branded cards.
Total operating expenses surged to $1.74 billion from $869 million in the prior year.
For the full year 2011, net income attributable to the company increased to $1.91 billion or $14.85 per share from $1.85 billion or $14.05 per share in the previous year. Annual revenues grew to $6.71 billion from $5.54 billion reported a year earlier.
Ajay Banga, president and chief executive officer of the company said, "For the full year, despite ongoing economic uncertainties, we posted strong performance ahead of our long-term objectives....Additionally, we continue to lay the foundation for growth through strategic partnerships with Western Union, Telefónica and Intel to provide consumers in developed and emerging markets with access to more efficient and safer forms of electronic payments,"
MA is currently trading at $377.04, up $19.42 or 5.43 percent, on a volume of 380 thousand shares on the NYSE.
For comments and feedback contact: editorial@rttnews.com
Business News
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.