Mastercard Lowers Financial Forecast, Signals Slower EPS, Revenue Growth Ahead

Mastercard Inc MA adjusted its financial outlook for 2025-2027, projecting slower net revenue growth than anticipated.

The new forecast estimates annual net revenue will grow in the “high-end of low-double-digits,” a noticeable deceleration compared to the high-teens growth expected for 2022-2024, Bloomberg reports.

The company anticipates a compound annual growth rate (CAGR) in the mid-teens for EPS over the next three years, down from its prior expectation of low-20s growth for 2022-2024.

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The company aims for an annual operating margin of at least 55% during the 2025-2027 timeframe, up from a minimum target of 50% for 2022-2024.

Mastercard reported third-quarter net revenue of $7.37 billion, a 13% increase from the previous year, surpassing the analyst estimate of $7.27 billion. Adjusted earnings per share climbed 15% year-over-year to $3.89, beating the expected $3.74 consensus.

Revenue from the payments network increased by 10% year-over-year (11% on a currency-neutral basis), driven by a 10% rise in gross dollar volume, a 17% growth in cross-border transactions, and an 11% boost in switched transactions. Mastercard anticipates net revenue growth in the low teens for the fourth quarter, above the $7.27 billion analyst forecast.

KeyBanc’s analyst Alex Markgraff examined credit and debit card volume data from recent third-quarter reports by Bank of America Corp BAC, Citigroup Inc C, JPMorgan Chase & Co JPM, and Wells Fargo & Co WFC.

Overall, the combined credit card volume for these banks grew 5% year-over-year, down from 6% in the previous quarter. Debit card volume increased by 4% year-over-year, slightly below the 5% growth seen in the second quarter.

The banks reported slower growth in card spending but noted consumer resilience continues, with stabilized spending patterns. JPMorgan highlighted customers have mostly exhausted their “cash buffer,” while Bank of America observed consistent payment growth into October.

This modest decline contrasts with forecasts for Mastercard and Visa Inc V, for which analysts expected an uptick in card volumes. Despite this, Markgraff believes third-quarter revenue risk remains minimal.

MA Price Action: Mastercard stock is down 1.08% at $523.61 at the last check on Wednesday.

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