Slides
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Mastercard Incorporated Third Quarter 2025 Financial Results Conference Call October 30, 2025
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©2025 Mastercard October 30, 2025 2 Business Update Michael Miebach: Financial Overview Business Highlights
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©2025 Mastercard October 30, 2025 3 3rd Quarter Selected Financial Performance ($ in millions, except per share data) 3Q 25 3Q 24 YOY Growth Non-GAAP Non-GAAP As adjusted Currency-neutral Net revenue $ 8,602 $ 7,369 17% 15% Adjusted operating expenses 3,459 2,999 15% 14% Adjusted operating income 5,144 4,370 18% 15% Adjusted operating margin 59.8 % 59.3 % 0.5 ppt 0.2 ppt Adjusted net income $ 3,961 $ 3,593 10% 8% Adjusted diluted EPS $ 4.38 $ 3.89 13% 11% Adjusted effective tax rate 21.4% 16.3 % Note: See Appendix A for Non-GAAP reconciliation. Figures may not sum due to rounding. Thanks, Michael. Turning to page 3, which shows our financial performance for the third quarter on a currency- neutral basis, excluding, where applicable, special items and the impact of gains and losses on our equity investments. • Net Revenue was up 15%, reflecting continued growth in our payment network and our value-added services and solutions. Acquisitions contributed 1 ppt to this growth. • Operating Expenses increased 14%, including a 4 ppt increase from acquisitions. • And, Operating Income was up 15%, which includes a 1 ppt headwind from acquisitions. • Net Income and EPS increased 8% and 11% respectively, driven primarily by the strong operating income growth, partially offset by a higher effective tax rate due to Pillar 2 and a change in our geographic mix of earnings. The tax rate in the quarter was higher than expected due to a discrete tax expense. • EPS was $4.38 cents, which includes a 10 cent contribution from share repurchases. • During the quarter, we repurchased $3.3 billion worth of stock and an additional $1.2 billion through October 27, 2025.
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©2025 Mastercard October 30, 2025 4 $2,502 $2,747 $768 $819 $1,734 $1,927 $1,168 $1,271 $398 $424 $771 $846 $1,334 $1,476 $370 $395 $963 $1,081 Credit Debit / Prepaid 3Q24 3Q25 3Q24 3Q25 3Q24 3Q25 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 Worldwide United States Rest of World 9% Growth 7% Growth 10% Growth Notes: Growth rates are shown in local currency. Figures may not sum due to rounding. ($ in billions) 3rd Quarter Gross Dollar Volume (GDV) Now turning to page 4. Let's first look at some of our key volume drivers for the third quarter on a local currency basis. Worldwide Gross Dollar Volume, or GDV, increased by 9% year-over-year. • In the U.S., GDV increased by 7%, with Credit growth of 7%, and Debit growth of 7%. • Outside of the U.S., volume increased 10%, with Credit growth of 10%, and Debit growth of 9%. Overall, Cross-border volume increased 15% globally for the quarter reflecting continued growth in both travel and non-travel related cross-border spending.
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©2025 Mastercard October 30, 2025 5 Turning to page 5. Switched transactions grew 10% year-over-year in Q3. We continue to see an increase in contactless penetration, which in Q3 stood at 77% of all in-person switched purchase transactions. This is up 6 ppt since the same period last year. In addition, card growth was 6%. Globally, there are 3.6 billion Mastercard and Maestro-branded cards issued. 3rd Quarter Switched Transactions and Cards Transactions (in billions) 41.1 45.4 3Q24 3Q250 10 20 30 40 50 Cards (in millions) 3,422 3,637 3,071 3,316 351 321 Mastercard Cards Maestro Cards 3Q24 3Q250 1,000 2,000 3,000 4,000 Switched Transactions Cards 10% Growth 6% Growth Note: Figures may not sum due to rounding.
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©2025 Mastercard October 30, 2025 6 Growth Payment Network1 Value-added Services and Solutions Total Net Revenue GAAP 12% 25% 17% Currency-neutral 10% 22% 15% 1 Payment Network is presented net of rebates and incentives of $5,389 million and $4,630 million for Q3'25 and Q3'24, respectively, which grew year-over-year by 16%, or 15% on a currency-neutral basis. 3rd Quarter Net Revenue ($ in millions) $4,629 $2,740 $7,369 $5,179 $3,423 $8,602 3Q24 3Q25 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 Turning to Slide 6 for a look into our Net Revenue growth rates for the third quarter, discussed on a currency-neutral basis. • Payment Network net revenue increased 10%, primarily driven by domestic and cross-border transaction and volume growth. It also includes growth in rebates and incentives. • Value-added Services and Solutions net revenue increased 22%. Acquisitions contributed approximately 3 ppt to this growth. The remaining 19% increase was primarily driven by: • growth in our underlying drivers, • strong demand across Security, Digital & Authentication solutions, Consumer Acquisition & Engagement services, and Business & Market Insights • and pricing value
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©2025 Mastercard October 30, 2025 7 Domestic Assessments Cross-Border Assessments Transaction Processing Assessments Other Network Assessments Increase/(Decrease) 6% 18% 17% 13% Increase/(Decrease) Currency-neutral 6% 16% 15% 12% 3rd Quarter Key Metrics related to the Payment Network ($ in millions) $2,641 $2,804 $3,587 $227 $2,809 $3,313 $4,191 $255 3Q24 3Q25 $0 $1,000 $2,000 $3,000 $4,000 $5,000 Now let’s turn to page 7 to discuss key metrics related to the Payment Network. Again, all growth rates are described on a currency-neutral basis unless otherwise noted. Looking quickly at each key metric: • Domestic Assessments were up 6%, while worldwide GDV grew 9%. The 3 ppt difference is primarily driven by mix. • Cross-Border Assessments increased 16%, while cross-border volumes increased 15%. The 1 ppt difference is driven by pricing in international markets partially offset by mix. • Transaction Processing Assessments were up 15%, while switched transactions grew 10%. On an unrounded basis, the 4 ppt difference is primarily due to favorable mix, as well as some benefit from pricing and revenue from FX volatility. • Other Network Assessments were $255 million this quarter.
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©2025 Mastercard October 30, 2025 8 3rd Quarter Adjusted Operating Expenses $2,554 $220 $225 $2,999$2,923 $245 $290 $3,459 3Q24 3Q25 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 ($ in millions) Growth General & Administrative Advertising & Marketing Depreciation & Amortization Adjusted Operating Expenses Non-GAAP 14% 11% 29% 15% Currency-neutral 13% 9% 27% 14% Note: See Appendix A for Non-GAAP reconciliation. Figures may not sum due to rounding. Moving on to page 8, you can see that on a non-GAAP, currency-neutral basis, excluding special items, Total Adjusted Operating Expenses increased 14%, which includes a 4 ppt impact from acquisitions. Excluding acquisitions, the growth of Total Adjusted Operating Expenses was primarily driven by increased spending to support various strategic initiatives, including investing in our infrastructure, geographic expansion, enhancing and delivering our products & services, and advertising & marketing. Total adjusted operating expenses were lower than expected this quarter, primarily due to the timing of expenses between the third and fourth quarter.
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©2025 Mastercard October 30, 2025 9 Turning to page 9, let me comment on the operating metric trends. Starting with Q3, all our switched metrics were generally in line with Q2 and remain strong. As we look to the first four weeks of October, our metrics continue to remain strong, generally inline with the third quarter. Of note: – US Switched Volumes saw a sequential decline primarily due to the Capital One debit migration, as well as some tougher comps related to weather impacts in 2024. Overall, we continue to see healthy consumer and business spending. Business Update Through October 28th 1. Mastercard-branded programs only; on a local currency basis. Year-over-year growth % 2025 Q2 Jul Aug Sep Q3 Oct 28 MTD Switched volume1 11% 11% 10% 11% 11% 9% United States 7% 9% 7% 7% 8% 5% Worldwide less U.S. 14% 13% 13% 13% 13% 12% Switched transactions 10% 10% 11% 10% 10% 10% Cross-border volume1 15% 14% 14% 16% 15% 15% Intra-Europe 17% 16% 16% 17% 16% 16% Other Cross-border 13% 12% 12% 14% 13% 13% XB CNP ex travel 20% 21% 21% 22% 21% 21% XB Travel (CP + CNP travel) 12% 10% 11% 11% 11% 11%
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©2025 Mastercard October 30, 2025 10 Looking Ahead Further thoughts on 2025
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Appendices
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©2025 Mastercard October 30, 2025 12 Appendix A Non-GAAP Reconciliation ($ in millions, except per share data) Note: Figures may not sum due to rounding. ** Not applicable. 1 Represents Q3’25 net pre-tax gains of $41 million and Q3'24 net pre-tax losses of $62 million primarily related to unrealized fair market value adjustments on marketable and nonmarketable equity securities. 2 Represents Q3’25 pre-tax charges of $83 million primarily due to a legal provision associated with the U.S. liability shift litigation. 3 Represents Q3’24 pre-tax charges of $176 million primarily as a result of a change in estimate related to the claims of merchants who opted out of the U.S. merchant class litigation. 4 Represents Q3’24 pre-tax charge of $190 million as a result of a restructuring action intended to streamline our organization, delivering efficiencies to enable reinvestment in our business to support the realization of our long-term growth opportunities. Three Months Ended September 30, 2025 Operating expenses Operating income Operating margin Other income (expense) Effective income tax rate Net income Diluted earnings per share Reported - GAAP $ 3,541 $ 5,061 58.8 % $ (62) 21.5 % $ 3,927 $ 4.34 (Gains) losses on equity investments 1 ** ** ** (41) — % (31) (0.03) Litigation provisions 2 (83) 83 1.0 % ** — % 65 0.07 Adjusted - Non-GAAP $ 3,459 $ 5,144 59.8 % $ (103) 21.4 % $ 3,961 $ 4.38 Three Months Ended September 30, 2024 Operating expenses Operating income Operating margin Other income (expense) Effective income tax rate Net income Diluted earnings per share Reported - GAAP $ 3,365 $ 4,004 54.3 % $ (138) 15.6 % $ 3,263 $ 3.53 (Gains) losses on equity investments 1 ** ** ** 62 (0.3) % 63 0.07 Litigation provisions 3 (176) 176 2.4 % ** 0.7 % 120 0.13 Restructuring charge 4 (190) 190 2.6 % ** 0.3 % 147 0.16 Adjusted - Non-GAAP $ 2,999 $ 4,370 59.3 % $ (75) 16.3 % $ 3,593 $ 3.89
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©2025 Mastercard October 30, 2025 13 Note: Figures may not sum due to rounding. ** Not applicable. 1 Represents Q3’25 net pre-tax gains of $41 million and Q3'24 net pre-tax losses of $62 million primarily related to unrealized fair market value adjustments on marketable and nonmarketable equity securities. 2 Represents Q3’25 pre-tax charges of $83 million primarily due to a legal provision associated with the U.S. liability shift litigation. 3 Represents Q3’24 pre-tax charges of $176 million primarily as a result of a change in estimate related to the claims of merchants who opted out of the U.S. merchant class litigation. 4 Represents Q3’24 pre-tax charge of $190 million as a result of a restructuring action intended to streamline our organization, delivering efficiencies to enable reinvestment in our business to support the realization of our long-term growth opportunities. 5 Represents the translational and transactional impact of currency and the related impact of the company's foreign exchange derivative contracts designated as cash flow hedging instruments (specifically those that manage the impact of foreign currency variability on anticipated revenues and expenses). Appendix A (continued) Non-GAAP Reconciliation Three Months Ended September 30, 2025 as compared to the Three Months Ended September 30, 2024 Increase/(Decrease) Operating expenses Operating income Operating margin Effective income tax rate Net income Diluted earnings per share Reported - GAAP 5 % 26 % 4.5 ppt 5.9 ppt 20 % 23 % (Gains) losses on equity investments 1 ** ** ** 0.2 ppt (3) % (3) % Litigation provisions 2,3 3 % (3) % (1.4) ppt (0.7) ppt (2) % (2) % Restructuring charge 4 7 % (5) % (2.6) ppt (0.3) ppt (5) % (5) % Adjusted - Non-GAAP 15 % 18 % 0.5 ppt 5.1 ppt 10 % 13 % Currency impact 5 (1) % (3) % (0.3) ppt (0.5) ppt (2) % (2) % Adjusted - Non-GAAP - currency-neutral 14 % 15 % 0.2 ppt 4.6 ppt 8 % 11 %
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©2025 Mastercard October 30, 2025 14 Appendix B Non-GAAP Reconciliation 2025 financial outlook Prior 2025 vs. 2024 Increase/(Decrease) Updated 2025 vs. 2024 Increase/(Decrease) Net Revenue Operating Expenses Net Revenue Operating Expenses Forecasted Growth - GAAP 1 High end of mid-teens High single digits High end of mid-teens Low end of low double digits Litigation provisions 2 ** 4% ** 4% Restructuring charge 3 ** 2% ** 2% Non-GAAP Growth High end of mid-teens High end of mid-teens High end of mid-teens High end of mid-teens Currency impact 4 (1-2)% (0-1)% (1-2)% (0-1)% Acquisitions 5 (1-1.5)% (4-5)% (1-1.5)% (4-5)% Non-GAAP Growth, currency-neutral, excl. acq. Low teens Low end of low double digits Low teens Low end of low double digits ** Not applicable. 1 GAAP - FY2025 forecast versus FY2024 reported results. Full Year Special Items 2 Impact of FY2024 litigation provisions ($680M) and YTD Q3'25 litigation provisions ($330M). 3 Impact of FY2024 restructuring charge ($190M). Other Notes 4 Represents the projected translational and transactional impact of currency and the related impact of the company’s foreign exchange derivative contracts designated as cash flow hedging instruments (specifically those that manage the impact of foreign currency variability on anticipated revenues and expenses). 5 Acquisitions completed after the beginning of 2024.
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©2025 Mastercard October 30, 2025 15 Appendix C Non-GAAP Reconciliation Fourth quarter 2025 financial outlook Q4'25 vs. Q4'24 Increase/(Decrease) Net Revenue Operating Expenses Forecasted Growth - GAAP 1 High teens High single digits Litigation provisions 2 ** 9% Non-GAAP Growth High teens High teens Currency impact 3 (4-4.5)% ~(2)% Acquisitions 4 (1-1.5)% (4-5)% Non-GAAP Growth, currency-neutral, excluding acquisitions High end of low double digits Low double digits ** Not applicable. 1 GAAP - Q4'25 forecast versus Q4'24 reported results. Fourth Quarter Special Items 2 Impact of Q4'24 litigation provisions ($280M). Other Notes 3 Represents the projected translational and transactional impact of currency and the related impact of the company’s foreign exchange derivative contracts designated as cash flow hedging instruments (specifically those that manage the impact of foreign currency variability on anticipated revenues and expenses). 4 Acquisitions completed after the beginning of 2024.
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©2025 Mastercard October 30, 2025 16 Forward-Looking Statements This earnings presentation contains forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts may be forward-looking statements. When used in this earnings presentation, the words “believe”, “expect”, “could”, “may”, “would”, “will”, “trend” and similar words are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements that relate to the company’s future prospects, developments and business strategies. We caution you to not place undue reliance on these forward-looking statements, as they speak only as of the date they are made. Except for the company’s ongoing obligations under the U.S. federal securities laws, the company does not intend to update or otherwise revise the forward-looking information to reflect actual results of operations, changes in financial condition, changes in estimates, expectations or assumptions, changes in general economic or industry conditions or other circumstances arising and/or existing since the preparation of this earnings presentation or to reflect the occurrence of any unanticipated events. Many factors and uncertainties relating to our operations and business environment, all of which are difficult to predict and many of which are outside of our control, influence whether any forward- looking statements can or will be achieved. Any one of those factors could cause our actual results to differ materially from those expressed or implied in writing in any forward-looking statements made by Mastercard or on its behalf, including, but not limited to, the following factors: For additional information on these and other factors that could cause the company’s actual results to differ materially from expected results, please see the company’s filings with the Securities and Exchange Commission, including the company’s Annual Report on Form 10-K for the year ended December 31, 2024 and any subsequent reports on Forms 10-Q and 8-K. • regulation related to the payments industry (including regulatory, legislative and litigation activity with respect to interchange rates and surcharging) • the impact of preferential or protective government actions • regulation of privacy, data, AI, information security and the digital economy • regulation that directly or indirectly applies to us based on our participation in the global payments industry (including anti-money laundering, countering the financing of terrorism, economic sanctions and anti-corruption, account-based payments systems, and issuer and acquirer practices regulation) • the impact of changes in tax laws, as well as regulations and interpretations of such laws or challenges to our tax positions • potential or incurred liability and limitations on business related to any litigation or litigation settlements • the impact of competition in the global payments industry (including disintermediation and pricing pressure) • the challenges relating to rapid technological developments and changes • the challenges relating to operating a real-time account-based payments system and to working with new customers and end users • the impact of information security incidents, account data breaches or service disruptions • issues related to our relationships with our stakeholders (including loss of substantial business from significant customers, competitor relationships with our customers, consolidation amongst our customers, merchants’ continued focus on acceptance costs and unique risks from our work with governments) • the impact of global economic, political, financial and societal events and conditions, including adverse currency fluctuations and foreign exchange controls • reputational impact, including impact related to brand perception and lack of visibility of our brands in products and services • the impact of environmental, social and governance matters and related stakeholder reaction • the inability to attract and retain a highly qualified workforce, or maintain our corporate culture • issues related to acquisition integration, strategic investments and entry into new businesses • exposure to loss or illiquidity due to our role as guarantor as well as other contractual obligations and discretionary actions we may take • issues related to our Class A common stock and corporate governance structure