Mastercard Inc (MA, Financial) released its third quarter 2023 financial results on October 26, 2023. The company reported a net income of $3.2 billion, and diluted earnings per share (EPS) of $3.39. The net revenue for the quarter was $6.5 billion, marking a 14% increase, or 11% on a currency-neutral basis. The gross dollar volume and purchase volume saw an increase of 11% and 12% respectively, on a local currency basis.
Financial Highlights
Mastercard's Q3 2023 operating income was $3.8 billion, a 24% increase from Q3 2022. The operating margin stood at 58.8%, up by 4.8 percentage points from the previous year. The effective income tax rate was 15.0%, down from 18.6% in Q3 2022. The company's net income saw a 28% increase to $3.2 billion, and diluted EPS increased by 31% to $3.39.
Mastercard's adjusted net income for Q3 2023 was also $3.2 billion, marking a 23% increase from Q3 2022. The adjusted operating margin was 58.8%, up by 1.2 percentage points from the previous year. The adjusted effective income tax rate was 15.0%, down from 19.4% in Q3 2022. The adjusted diluted EPS was $3.39, a 26% increase from Q3 2022.
CEO Commentary
“We delivered strong revenue and earnings growth again this quarter, reflecting the solid fundamentals of our business and the continued resilience in consumer spending. Our cross-border volumes increased 21%, reflecting the ongoing strength in both travel and non-travel cross-border spending,” said Michael Miebach, Mastercard CEO. “While macroeconomic and geopolitical uncertainty remains elevated, our diversified business model positions us well to capitalize on the substantial opportunities in payments and services.”
Year-to-Date Results
Year-to-date, Mastercard's net revenue was $18.6 billion, a 13% increase from 2022. The operating income was $10.6 billion, marking a 17% increase. The effective income tax rate was 18.6%, up from 14.3% in 2022. The net income was $8.4 billion, a 13% increase, and diluted EPS was $8.85, a 16% increase.
The adjusted net income was $8.6 billion, an 11% increase from 2022. The adjusted operating margin was 58.6%, up by 0.9 percentage points from the previous year. The adjusted effective income tax rate was 19.0%, up from 14.8% in 2022. The adjusted diluted EPS was $9.08, a 14% increase from 2022.
Return of Capital to Shareholders
In the third quarter of 2023, Mastercard repurchased 4.8 million shares at a cost of $1.9 billion and paid $538 million in dividends. Through September 30, 2023, Mastercard repurchased 19.2 million shares at a cost of $7.2 billion and paid $1.6 billion in dividends.
Explore the complete 8-K earnings release (here) from Mastercard Inc for further details.
