Consumers are apparently staying home with it.
While the "Don't Leave Home Without It" slogan belongs to rival American Express, Mastercard (MA) - Get Report on Wednesday pointed to the significant drop-off in personal and business travel for its lower year-over-year third-quarter earnings and revenue numbers.
Mastercard posted better-than-expected third-quarter earnings as consumers continued to pivot away from cash and toward plastic for both online and in-person transactions, though a drop in travel and leisure activity due to the pandemic led to lower transactions and revenue.
The Purchase, N.Y., company posted their-quarter adjusted income of $1.6 billion, or $1.60 a share, vs. $2.2 billion, or $2.15 a share, in the year-earlier quarter. The results were slightly better than the $1.65 a share consensus forecast in a survey by FactSet.
Revenue totaled $3.8 billion, down 14% from $14.5 billion a year earlier, though above FactSet estimates of $3.96 billion. Operating expenses dropped to $1.7 billion from $1.8 billion a year earlier, while operating margin narrowed to 54.9% from 59.4%.
While encouraged by progress in the trajectory of domestic spending, "travel spending remains a challenge,” CEO Ajay Banga said in a statement. “Meanwhile, we are winning new business in core payments and are making real progress with our digital solutions, differentiated service offerings and multi-rail capabilities.”
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