(Reuters) -Mastercard beat Wall Street estimates for first-quarter profit on Thursday as customers kept up spending on its card network despite the economic uncertainty sparked by a global trade war, sending its shares up 1.7% in premarket trading.
U.S. consumer spending held up in the reported quarter thanks to wage growth and a resilient labor market, even as tariff-driven turmoil casts a shadow on the economy.
“While there is uncertainty in the world, we’ve built a diversified, resilient business model and proven strategy that enables us to effectively navigate various economic environments,” CEO Michael Miebach said.
The strong start was aided in part by cross-border volume growth of 15%, he said, which tracks spending on cards outside the country of their issue.
The results underscore the resilience of card networks, which are viewed as more defensive in a downturn relative to the broader payments space, given their high share of everyday spend and expense flexibility to support profit growth.
Mastercard’s results cap off the earnings season for card companies and are closely watched by Wall Street to assess the health of U.S. consumers.
Rival Visa beat quarterly profit expectations earlier this week on resilient spending.
Growing revenue contribution from value-added services such as threat intelligence and fraud reduction also helped Mastercard diversify its business model.
Its value-added services and solutions business, which now makes up more than a third of its revenues, fetched 18% higher revenue in the quarter.
Excluding one-time costs, Mastercard earned $3.73 per share in the first quarter, beating analysts’ expectation of $3.57 per share, according to estimates compiled by LSEG.
Revenue jumped 17% to $7.25 billion, topping an estimate of $7.12 billion.
The company now expects revenue to grow in the “low-teens” percentage range this year. It had earlier forecast growth to be in the “low double-digits” range.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Pooja Desai)
