MasterCard's 3Q Net Crushes Estimates

Carried by an acceleration in global spending, MasterCard (NYSE:MA) blew Wall Street away on Wednesday with a 38% leap in third-quarter profits, sending the card-processing giant’s stock soaring more than 7%.

Armonk, N.Y.-based MasterCard said it earned $716 million, or $5.63 a share, last quarter, compared with a profit of $519 million, or $3.94 a share, a year earlier. Analysts had called for EPS of just $4.82.

Revenue climbed 27% to $1.8 billion, surpassing the Street’s view of $1.71 billion.

MasterCard’s growth was driven by increases in both spending and transactions by consumers around the world.

The company said global purchase volume jumped 17.2% last quarter to $628 billion. Gross dollar volume was up 18.1%, while processed transactions grew by 20.5%. MasterCard said these gains were offset a bit by higher rebates and incentives.

“Economic indicators across the world remain mixed, with the uncertainties in Europe and the United States weighing on sentiment and dominating headlines,” CEO Ajay Banga said in a statement. “Nonetheless, we continue to focus on displacing cash and winning share across markets.”

Shareholders cheered MasterCard’s results, sending its stock soaring 7.39% to $359.00 ahead of Wednesday’s open. The rally puts MasterCard in position to add to its impressive 2011 surge of nearly 50%.

MasterCard said that as of the end of the third quarter, it had issued 1.7 billion MasterCard and Maestro-branded cards. Total operating expenses rose 23.1% to $816 million.