MasterCard (NYSE:MA) beat the Street on Tuesday with a 24% rise in first-quarter profits as the card giant parlayed increased consumer spending into stronger earnings despite global turmoil.
The Purchase, N.Y.-based financial services company said it earned $562 million, or $4.29 a share, last quarter, compared with a profit of $455 million, or $3.46 a share, a year earlier. Analysts had been calling for EPS of just $4.10.
Revenue grew 14.8% to $1.5 billion, surpassing the $1.46 billion Wall Street had estimated.
MasterCard, which operates the world’s second-largest card processing network, revealed a 12.8% increase in gross dollar volume to $728 billion and an 11.% rise in the number of processed transactions to 6 billion.
“We had a strong start to 2011 despite the hardships experienced by many consumers and businesses due to natural disasters and political turmoil in several markets,” CEO Ajay Banga said in a statement. “This growth is reflective of the strong fundamentals" and global business.
MasterCard also disclosed a 9.4% jump in operating expenses to $665 million, mostly due to increased investments, the inclusion of DataCash’s expenses and a 12.1% rise in ad and marketing spending.
Shareholders cheered MasterCard’s earnings beat, bidding the stock 2.80% higher to $283.00. Those gains position MasterCard to extend its 22.8% 2011 leap.