Mastercard Q3 2026 Adjusted EPS Rises 21% as Services Grow 19%

Mastercard Incorporated reported double-digit third-quarter revenue and profit growth as payment activity remained resilient and demand for its value-added services strengthened. Adjusted diluted earnings per share rose 21% to $5.31, while the company maintained its full-year expectation for currency-neutral, organic net revenue growth at the high end of the low-double-digit range.

For the quarter ended Sept. 30, Mastercard’s (NYSE: MA) net revenue increased 14% year over year to $9.81 billion on both a reported and currency-neutral basis. The company said revenue exceeded its expectations, primarily because of continued business strength and the timing of services projects and payment-network deals.

Adjusted operating income grew 15% on a currency-neutral basis to $5.94 billion. The adjusted operating margin widened by 0.7 percentage point to 60.5%, as revenue growth outpaced a 12% increase in adjusted operating expenses. Adjusted net income rose 18% on a currency-neutral basis to $4.65 billion.

On a GAAP basis, operating income increased 16% to $5.86 billion, net income rose 18% to $4.63 billion and diluted EPS advanced 22% to $5.28. The GAAP results included $74 million of pre-tax litigation provisions, primarily related to settlements with merchants that opted out of U.S. merchant class litigation.

Share repurchases contributed $0.16 to adjusted EPS. Mastercard bought back $3.0 billion of stock during the quarter and repurchased an additional approximately $648 million through Oct. 26.

Payment volumes support network growth

Worldwide gross dollar volume increased 7% in local currency. U.S. volume grew 6%, including a 10% increase in credit and 1% growth in debit, with the debit figure reflecting the Capital One migration. Outside the U.S., volume rose 8%, comprising 6% credit growth and 10% debit growth.

Cross-border volume increased 11%, supported by both travel and non-travel spending. Switched transactions rose 9% to 49.3 billion, while the number of Mastercard- and Maestro-branded cards increased 5% to about 3.8 billion.

Contactless payments accounted for 81% of in-person switched purchase transactions, up 5 percentage points from a year earlier.

Payment Network net revenue rose 11% to $5.75 billion on a currency-neutral basis, driven primarily by domestic and cross-border transaction and volume growth, as well as pricing. Rebates and incentives increased 18% to $6.37 billion.

Domestic assessments grew 13%, compared with 7% growth in worldwide gross dollar volume, with Mastercard attributing the difference mainly to pricing and mix. Cross-border assessments increased 16%, while transaction processing assessments rose 14%. Pricing and mix also helped those measures grow faster than their underlying volume drivers, though lower revenue from foreign-exchange volatility partly offset transaction-processing growth.

Services revenue rises 19%

Value-added Services and Solutions net revenue increased 19% to $4.06 billion on both a reported and currency-neutral basis, with acquisitions and dispositions having a minimal overall effect. The segment now includes contributions from BVNK.

Mastercard cited underlying business drivers, pricing and demand across Consumer Acquisition & Engagement, Business & Market Insights, Security Solutions, and Digital & Authentication as the principal contributors to growth.

Adjusted operating expenses rose 12% to $3.87 billion on a currency-neutral basis, including a 1-percentage-point contribution from acquisitions and dispositions. Spending was directed toward product innovation, geographic expansion and technology investments.

Business indicators remained positive in the early part of the fourth quarter. Through Oct. 21, switched volume was up 10% year over year, switched transactions increased 9% and cross-border volume grew 10%, all measured in local currency for Mastercard-branded programs. Cross-border card-not-present volume excluding travel rose 14%, while cross-border travel volume increased 7%.

2026 outlook

For full-year 2026, Mastercard expects GAAP net revenue to grow in the low teens and GAAP operating expenses to increase at the low end of the low-double-digit range. On a non-GAAP, currency-neutral basis excluding acquisitions and dispositions, management expects net revenue growth at the high end of the low-double-digit range and operating expense growth in the low double digits.

The company estimates that currency will reduce full-year net revenue growth by about 1 percentage point and operating expense growth by 0.5 to 1 percentage point. Inorganic activity is expected to have approximately no effect on either measure.

For the fourth quarter, Mastercard projects GAAP net revenue growth at the high end of the low-double-digit range and GAAP operating expense growth in the high single digits. Excluding special items, currency effects and inorganic activity, both net revenue and operating expenses are expected to grow at the high end of the low-double-digit range.

Mastercard cautioned that its outlook remains subject to regulatory and litigation developments, competition and pricing pressure, technological change, cybersecurity incidents, customer concentration, acquisition integration, currency movements and broader economic, political and financial conditions.