MasterCard's revenue falls short of estimates as rebates increase

MasterCard Inc , the world's second-biggest payments processor, reported lower-than-expected quarterly revenue on Tuesday due to an increase in rebates and incentives.

However, adjusted profit came in slightly ahead of estimates as customers spent more during the holiday shopping season.

MasterCard, whose shares were down 1.8 percent in premarket trading, reported revenue of $2.76 billion for the quarter ended Dec. 31 - a rise of 9.5 percent from a year earlier but short of the average analysts' estimate of $2.79 billion.

The company's net income rose 4.8 percent to $933 million, or 86 cents per share, in the period, from $890 million, or 79 cents per share, a year earlier.

On an adjusted basis, MasterCard also earned 86 cents per share, beating the average analysts' estimate by a cent, according to Thomson Reuters I/B/E/S.

MasterCard, which processes more than 65,000 transactions every minute, said gross dollar volumes in the rose 9 percent to $1.2 trillion in the fourth quarter on a local currency basis.

The United States, the company's largest market, accounted for a little under a third of the total.

MasterCard, which deals in 150 currencies, said cross-border volumes - the value of transactions made by card holders outside the home country of the card-issuer - increased 13 percent.

Up to Monday's close of $109.30, the company's shares had risen about 23 percent in the past 12 months.

Visa Inc , the world's biggest payments processor, will report quarterly results on Thursday.

(Reporting by Nikhil Subba in Bengaluru; Editing by Ted Kerr)