Mastercard Inc beat Wall Street estimates for fourthquarter profit on Thursday, as a recovery in customer spending partially offset the decline in crossborder volumes due to limited travel demand since the COVID19 pandemic outbreak.
While travel has taken a massive hit due to the health crisis, contactless payments have surged and become mainstream, helping card companies such as Mastercard and Visa counter the impact of the pandemic on their bottom line.
Mastercard, in a recent presentation for investors, said transactions in the U.S. were up 7, and down 2 outside the United States in the third week of January.
Shares of the company jumped nearly 3 in trading before the bell, as results showed that Mastercard managed to drive growth in overall volumes during the fourth quarter despite a resurgence in COVID19 cases.
Earlier this week, credit card issuer American Express Co also beat profit estimates, despite a slump in demand for travel and entertainment.
Excluding items, Mastercard reported net income of 1.6 billion for the quarter ended Dec. 31, or 1.64 per share, compared with 2 billion a year earlier, or 1.96 a share.
Analysts on average were expecting a profit of 1.51 per share, according to the IBES estimate from Refinitiv.
Gross dollar volume the dollar value of transactions processed rose 1 from a year earlier to 1.7 trillion.
Crossborder volume, a measure for spending outside the country where the card was issued, fell 29 on a local currency basis.