Credit Card Juggernaut MasterCard's Stock Tanks Despite Q3 Beat

Mastercard Inc MA shares are trading lower after the company reported Q3 FY23 results.

Net revenues stood at $6.53 billion, up 14% Y/Y and 11% Y/Y on a neutral currency basis, beating the consensus of $6.52 billion.

Payment network net revenue rose 12% Y/Y (+10% Y/Y on a currency-neutral basis), led by growth in gross dollar volume (+11% Y/Y), cross-border volume (+21% Y/Y) and switched transactions (+15% Y/Y). 

Value-added services and solutions net revenue rose 17% and 14% on a currency-neutral basis, driven by continued strong growth in cyber and intelligence solutions and high demand for consulting and marketing services and loyalty solutions.

Also ReadMastercard's Product Roster To Expand With Self-Custody Wallet Firms Partnership

Adjusted operating expenses rose 10% Y/Y to $2.7 billion due to higher personnel costs and acquisitions. 

The adjusted operating margin expanded ~120bps Y/Y to 58.8%.

Adjusted EPS rose 26% Y/Y to $3.39, exceeding the consensus of $3.21.

As of September 30, 2023, the customers had issued 3.3 billion Mastercard and Maestro-branded cards. 

In Q3, Mastercard repurchased shares worth $1.9 billion and paid $538 million in dividends.

As of September 30, 2023, cash flow from operating activities stood at $7.85 billion, and cash and cash equivalents stood at $6.89 billion.

Outlook: For Q4, MA expects net revenue growth in low-double digits

Also ReadMastercard's Second Collab For The Day: MoonPay Partnership For Exploring Web3

Price Action: MA shares are down 5.21% at $366.18 on the last check Thursday.

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