MasterCard profit beats driven by international business
By Amrutha Gayathri and Tanya Agrawal
(Reuters) - MasterCard Inc (MA.N: Quote) reported a better-than-expected 15.5 percent jump in quarterly profit as efforts to expand its international business pay off, with more people willing to use cards instead of cash.
China's decision to open up its $1 trillion a year domestic bank card market to foreign companies should further benefit the company and its larger rival Visa Inc (V.N: Quote).
"We are pleased with the announcement and see it as a good step in the right direction," MasterCard Chief Executive Ajay Banga said on a post-earnings conference call.
MasterCard's shares were up 7 percent at $81.25 in midday trading. Visa was up 8.7 percent, the biggest gainer on the Dow Jones Industrial Average .DJI on Thursday.
MasterCard has a bigger exposure to global markets than Visa, deriving nearly 60 percent of its revenue from its international business.
Wedbush Securities analyst Gil Luria said if the two companies were to grow at their current rate, they would need big new opportunities and China was one of them.
MasterCard's worldwide purchase volume, excluding the United States, grew 12.8 percent to $554 billion on local currency basis in the third quarter.
The company's cross-border volume fees rose 14 percent to $835 million. Continued...