Mastercard's Q3 Earnings Soar on Strong Revenue Growth

Ticker: MA · Form: 10-Q · Filed: 2025-10-30T00:00:00.000Z

Sentiment: bullish

Topics: Payments Industry, Financial Technology, Earnings Growth, Share Buybacks, Global Expansion, Value-Added Services, Digital Payments

Related Tickers: MA, V, AXP, PYPL

TL;DR

**Mastercard is crushing it, buy the dip if you get one, because this growth isn't slowing down.**

AI Summary

Mastercard Inc. reported robust financial performance for the three and nine months ended September 30, 2025. Net revenue for the third quarter increased by 16.7% to $8.602 billion from $7.369 billion in the prior year, driven by strong growth in both payment network and value-added services. Net income for the quarter rose significantly by 20.3% to $3.927 billion, up from $3.263 billion in Q3 2024. For the nine-month period, net revenue grew 16.0% to $23.985 billion, and net income increased by 14.4% to $10.908 billion. Operating expenses saw a more modest increase of 5.2% to $3.541 billion for the quarter, with a notable decrease in provision for litigation from $176 million to $83 million. The company's strategic outlook remains positive, with continued investment in value-added services and global expansion, particularly in Asia Pacific, Europe, Middle East, and Africa, which saw a 17.5% revenue increase to $4.951 billion for the quarter. Share repurchases continued aggressively, with $8.265 billion spent on treasury stock purchases in the nine months ended September 30, 2025.

Why It Matters

Mastercard's impressive Q3 2025 performance, with net revenue up 16.7% and net income up 20.3%, signals continued strength in the global digital payments sector. For investors, this demonstrates Mastercard's ability to grow market share and profitability amidst a competitive landscape, potentially leading to sustained stock appreciation. Employees benefit from a thriving company, while customers can expect continued innovation in payment solutions. This strong showing also puts competitive pressure on rivals like Visa and American Express, highlighting the ongoing battle for dominance in payment processing and value-added services.

Risk Assessment

Risk Level: low — Mastercard's risk level is low, evidenced by strong revenue growth of 16.7% and net income growth of 20.3% for the quarter. The company also reduced its provision for litigation from $176 million in Q3 2024 to $83 million in Q3 2025, indicating a decrease in potential legal liabilities. Furthermore, the company's robust cash flow from operations, at $12.646 billion for the nine months ended September 30, 2025, provides significant financial flexibility.

Analyst Insight

Investors should consider holding or increasing their position in Mastercard (MA) given its consistent revenue and net income growth, strong cash flow, and aggressive share repurchase program. The company's focus on value-added services and international expansion positions it well for future market leadership.

Financial Highlights

revenue
$8.602B
total Assets
$53.289B
total Debt
$18.983B
net Income
$3.927B
eps
$4.34
cash Position
$10.313B
revenue Growth
+16.7%

Revenue Breakdown

SegmentRevenueGrowth
Payment Network$5.179B
Value-Added Services$3.423B
Asia Pacific, Europe, Middle East, and Africa$4.951B+17.5%

Key Numbers

Key Players & Entities

FAQ

What were Mastercard's net revenue and net income for the third quarter of 2025?

Mastercard reported net revenue of $8.602 billion for the three months ended September 30, 2025, an increase of 16.7% from $7.369 billion in the same period last year. Net income for the quarter was $3.927 billion, up 20.3% from $3.263 billion in Q3 2024.

How did Mastercard's operating expenses change in Q3 2025 compared to Q3 2024?

Total operating expenses for Mastercard increased by 5.2% to $3.541 billion in Q3 2025, compared to $3.365 billion in Q3 2024. Notably, the provision for litigation decreased significantly from $176 million in Q3 2024 to $83 million in Q3 2025.

What was Mastercard's diluted earnings per share for the third quarter of 2025?

Mastercard's diluted earnings per share (EPS) for the three months ended September 30, 2025, was $4.34, an increase from $3.53 in the third quarter of 2024.

What were the key drivers of Mastercard's revenue growth in the nine months ended September 30, 2025?

For the nine months ended September 30, 2025, Mastercard's net revenue grew to $23.985 billion, driven by strong performance in both payment network services, which generated $14.556 billion, and value-added services and solutions, which contributed $9.429 billion.

Did Mastercard engage in share repurchases during the nine months ended September 30, 2025?

Yes, Mastercard aggressively repurchased its Class A common stock, spending $8.265 billion on purchases of treasury stock during the nine months ended September 30, 2025, demonstrating a commitment to returning capital to shareholders.

How much cash did Mastercard generate from operating activities in the first nine months of 2025?

Mastercard generated $12.646 billion in net cash from operating activities for the nine months ended September 30, 2025, indicating strong operational efficiency and liquidity.

What was the trend in Mastercard's goodwill and other intangible assets?

Mastercard's goodwill increased to $9.574 billion as of September 30, 2025, from $9.193 billion at December 31, 2024. Other intangible assets, net, also increased to $5.591 billion from $5.453 billion over the same period, reflecting strategic investments and acquisitions.

What is Mastercard's geographic revenue breakdown for Q3 2025?

For Q3 2025, Mastercard's net revenue from the Americas was $3.651 billion, while the Asia Pacific, Europe, Middle East, and Africa regions collectively generated $4.951 billion, highlighting significant international market contribution.

Are there any significant legal proceedings or risk factors mentioned in Mastercard's 10-Q?

The 10-Q refers to a complete discussion of risk factors in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2024. While the provision for litigation decreased in Q3 2025, the filing directs readers to the 10-K for a comprehensive overview of legal proceedings and risks.

What is Mastercard's current outstanding share count?

As of October 27, 2025, Mastercard had 891,258,183 shares outstanding of its Class A common stock and 6,737,665 shares outstanding of its Class B common stock.

Risk Factors

Industry Context

Mastercard operates in the dynamic global payments industry, characterized by increasing digital adoption and evolving consumer preferences. The competitive landscape includes traditional card networks, emerging fintech solutions, and central bank digital currencies. Growth is driven by cross-border transactions, e-commerce expansion, and the adoption of value-added services like data analytics and fraud prevention.

Regulatory Implications

Mastercard faces significant regulatory scrutiny worldwide concerning interchange fees, data privacy (e.g., GDPR, CCPA), and anti-trust matters. Compliance with these evolving regulations is critical and requires continuous investment in legal and operational frameworks to avoid penalties and maintain market access.

What Investors Should Do

  1. [object Object]
  2. [object Object]
  3. [object Object]
  4. [object Object]

Key Dates

Glossary

Treasury Stock
Shares of a company's own stock that it has repurchased from the open market. These shares can be held for future use or retired. (Mastercard spent $8.265 billion on treasury stock purchases in the nine months ended September 30, 2025, indicating a significant capital return to shareholders.)
Value-Added Services
Services offered by a company that go beyond the core product or service, providing additional benefits or solutions to customers. (Mastercard's Value-Added Services revenue was $3.423 billion for Q3 2025, highlighting its strategic focus on diversification and growth in this segment.)
Provision for Litigation
An accounting charge set aside to cover potential costs associated with ongoing or anticipated legal disputes. (The decrease in provision for litigation from $176 million in Q3 2024 to $83 million in Q3 2025 positively impacted operating expenses.)
Accumulated Other Comprehensive Income (Loss)
A component of equity that includes unrealized gains and losses on certain investments, foreign currency translation adjustments, and pension adjustments that have not been included in net income. (This account showed a net loss of $935 million as of September 30, 2025, primarily influenced by foreign currency translation adjustments.)
Goodwill
An intangible asset that arises when a company acquires another company for a price greater than the fair value of its net identifiable assets. (Goodwill increased to $9.574 billion as of September 30, 2025, suggesting recent acquisitions or revaluations.)

Year-Over-Year Comparison

Mastercard demonstrated robust year-over-year growth in the third quarter of 2025, with net revenue increasing by 16.7% to $8.602 billion and net income rising by 20.3% to $3.927 billion. This performance outpaces the prior year's growth, indicating strong market demand and effective operational execution. Operating expenses saw a more controlled increase of 5.2%, partly due to a significant reduction in the provision for litigation, which positively impacted net income. The company continues to aggressively repurchase shares, with $8.265 billion spent on treasury stock in the nine-month period, a notable increase from the prior year, signaling confidence and a commitment to shareholder returns.

Filing Stats: 4,794 words · 19 min read · ~16 pages · Grade level 20 · Accepted 2025-10-30 10:14:27

Key Financial Figures

Filing Documents

Management's discussion and analysis of financial condition and results of operations

Management's discussion and analysis of financial condition and results of operations 42 Item 3.

Quantitative and qualitative disclosures about market risk

Quantitative and qualitative disclosures about market risk 43 Item 4.

Controls and procedures

Controls and procedures PART II 45 Item 1.

Legal proceedings

Legal proceedings 45 Item 1A.

Risk factors

Risk factors 45 Item 2. Unregistered sales of equity securities and use of proceeds 45 Item 5. Other information 45 Item 6. Exhibits 47 - Signatures 2 MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q In this Report on Form 10-Q ("Report"), references to the "Company," "Mastercard," "we," "us" or "our" refer to the business conducted by Mastercard Incorporated and its consolidated subsidiaries, including our operating subsidiary, Mastercard International Incorporated, and to the Mastercard brand.

Forward-Looking Statements

Forward-Looking Statements This Report contains forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts may be forward-looking statements. When used in this Report, the words "believe", "expect", "could", "may", "would", "will", "trend" and similar words are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements that relate to the Company's future prospects, developments and business strategies. Many factors and uncertainties relating to our operations and business environment, all of which are difficult to predict and many of which are outside of our control, influence whether any forward-looking statements can or will be achieved. Any one of those factors could cause our actual results to differ materially from those expressed or implied in writing in any forward-looking statements made by Mastercard or on its behalf, including, but not limited to, the following factors: regulation related to the payments industry (including regulatory, legislative and litigation activity with respect to interchange rates and surcharging) the impact of preferential or protective government actions regulation of privacy, data, AI, information security and the digital economy regulation that directly or indirectly applies to us based on our participation in the global payments industry (including anti-money laundering, countering the financing of terrorism, economic sanctions and anti-corruption, account-based payments systems, and issuer and acquirer practices regulation) the impact of changes in tax laws, as well as regulations and interpretations of such laws or challenges to our tax positions potential or incurred liability and limitations on business related to any litigation or litigation settlements the impact of competition in the global payments industry (including di

Consolidated financial statements (unaudited)

Item 1. Consolidated financial statements (unaudited)

Management's discussion and analysis of financial condition and results of operations

Item 2. Management's discussion and analysis of financial condition and results of operations

Quantitative and qualitative disclosures about market risk

Item 3. Quantitative and qualitative disclosures about market risk

Controls and procedures

Item 4. Controls and procedures PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Consolidated financial statements (unaudited)

Item 1. Consolidated financial statements (unaudited) Mastercard Incorporated Index to consolidated financial statements (unaudited) Page Consolidated Statements of Operations — Three and Nine Months Ended September 30, 2025 and 2024 6 Consolidated Statements of Comprehensive Income — Three and Nine Months Ended September 30, 2025 and 2024 7 Consolidated Balance Sheets — September 30, 2025 and December 31, 2024 8 Consolidated Statements of Changes in Equity — Three and Nine Months Ended September 30, 2025 and 2024 9 Consolidated Statements of Cash Flows — Nine Months Ended September 30, 2025 and 2024 11

Notes to consolidated financial statements

Notes to consolidated financial statements 12 MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q 5 PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Statements of Operations (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 (in millions, except per share data) Net Revenue $ 8,602 $ 7,369 $ 23,985 $ 20,678 Operating Expenses: General and administrative 2,923 2,744 8,212 7,448 Advertising and marketing 245 220 610 520 Depreciation and amortization 290 225 846 666 Provision for litigation 83 176 330 400 Total operating expenses 3,541 3,365 9,998 9,034 Operating income 5,061 4,004 13,987 11,644 Other Income (Expense): Investment income 81 76 239 231 Gains (losses) on equity investments, net 41 ( 62 ) 16 ( 69 ) Interest expense ( 186 ) ( 159 ) ( 563 ) ( 462 ) Other income (expense), net 2 7 23 19 Total other income (expense) ( 62 ) ( 138 ) ( 285 ) ( 281 ) Income before income taxes 4,999 3,866 13,702 11,363 Income tax expense 1,072 603 2,794 1,831 Net Income $ 3,927 $ 3,263 $ 10,908 $ 9,532 Basic Earnings per Share $ 4.35 $ 3.54 $ 12.02 $ 10.27 Basic weighted-average shares outstanding 903 923 908 928 Diluted Earnings per Share $ 4.34 $ 3.53 $ 12.00 $ 10.25 Diluted weighted-average shares outstanding 905 925 909 930 The accompanying notes are an integral part of these consolidated financial statements. 6 MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 (in millions) Net Income $ 3,927 $ 3,263 $ 10,908 $ 9,532 Other comprehensive income (loss): Foreign currency translation adjustments ( 62 ) 262 625 48 Income tax effect 12 ( 8 ) ( 44 ) 19 Foreign currency translation adjustments, net of income tax effect ( 50 ) 254 581 67 Translation adjustments on net investment hedges ( 2 ) ( 183 ) ( 210 ) ( 134 ) Income tax effect — 40 46 29 Translation adjustments on net investment hedges, net of income tax effect ( 2 ) ( 143 ) ( 164 ) ( 105 ) Cash flow hedges 34 ( 110 ) ( 314 ) 3 Income tax effect ( 1 ) 6 21 ( 2 ) Reclassification adjustments for cash flow hedges 8 124 382 61 Income tax effect ( 4 ) ( 1 ) ( 8 ) ( 2 ) Cash flow hedges, net of income tax effect 37 19 81 60 Defined benefit pension and other postretirement plans — — — 2 Income tax effect — — — — Defined benefit pension and other postretirement plans, net of income tax effect — — — 2 Investment securities available-for-sale ( 1 ) 2 — 2 Income tax effect — — — — Investment securities available-for-sale, net of income tax effect ( 1 ) 2 — 2 Other comprehensive income (loss), net of income tax effect ( 16 ) 132 498 26 Comprehensive Income $ 3,911 $ 3,395 $ 11,406 $ 9,558 The accompanying notes are an integral part of these consolidated financial statements. MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q 7 PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Balance Sheets (Unaudited) September 30, 2025 December 31, 2024 (in millions, except per share data) Assets Current assets: Cash and cash equivalents $ 10,313 $ 8,442 Restricted cash and restricted cash equivalents 478 492 Restricted security deposits held for customers 2,054 1,874 Investments 335 330 Accounts receivable 4,247 3,773 Settlement assets 1,842 1,821 Prepaid expenses and other current assets 3,954 2,992 Total current assets 23,223 19,724 Property, equipment and right-of-use assets, net of accumulated depreciation and amortization of $ 2,656 and $ 2,393 , respectively 2,299 2,138 Deferred income taxes 1,546 1,614 Goodwill 9,574 9,193 Other intangible assets, net of accumulated amortization of $ 2,927 and $ 2,400 , respectively 5,591 5,453 Other assets 11,056 9,959 Total Assets $ 53,289 $ 48,081 Liabilities and Equity Current liabilities: Accounts payable $ 935 $ 929 Settlement obligations 2,422 2,316 Restricted security deposits held for customers 2,054 1,874 Accrued litigation 943 930 Accrued expenses 11,979 10,393 Short-term debt — 750 Other current liabilities 2,360 2,028 Total current liabilities 20,693 19,220 Long-term debt 18,983 17,476 Deferred income taxes 326 317 Other liabilities 5,368 4,553 Total Liabilities 45,370 41,566 Commitments and Contingencies Stockholders' Equity Class A common stock, $ 0.0001 par value; authorized 3,000 shares, 1,405 and 1,404 shares issued and 893 and 907 shares outstanding, respectively — — Class B common stock, $ 0.0001 par value; authorized 1,200 shares, 7 shares issued and outstanding — — Additional paid-in-capital 6,757 6,442 Class A treasury stock, at cost, 512 and 497 shares, respectively ( 79,670 ) ( 71,431 ) Retained earnings 81,752 72,907 Accumulated other comprehensive income (loss) ( 935 ) ( 1,433 ) Mastercard Incorporated Stockholders' Equity 7,904 6,485 Non-controlling interests 15 30 Tot

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Statement of Changes in Equity (Unaudited) Stockholders' Equity Common Stock Additional Paid-In Capital Class A Treasury Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Mastercard Incorporated Stockholders' Equity Non- Controlling Interests Total Equity Class A Class B (in millions) Three Months Ended September 30, 2025 Balance at beginning of period $ — $ — $ 6,562 $ ( 76,299 ) $ 78,509 $ ( 919 ) $ 7,853 $ 21 $ 7,874 Net income — — — — 3,927 — 3,927 — 3,927 Activity related to non-controlling interests — — — — — — — ( 6 ) ( 6 ) Other comprehensive income (loss) — — — — — ( 16 ) ( 16 ) — ( 16 ) Dividends — — — — ( 684 ) — ( 684 ) — ( 684 ) Purchases of treasury stock — — — ( 3,371 ) — — ( 3,371 ) — ( 3,371 ) Share-based payments — — 195 — — — 195 — 195 Balance at end of period $ — $ — $ 6,757 $ ( 79,670 ) $ 81,752 $ ( 935 ) $ 7,904 $ 15 $ 7,919 Nine Months Ended September 30, 2025 Balance at beginning of period $ — $ — $ 6,442 $ ( 71,431 ) $ 72,907 $ ( 1,433 ) $ 6,485 $ 30 $ 6,515 Net income — — — — 10,908 — 10,908 — 10,908 Activity related to non-controlling interests — — — — — — — ( 15 ) ( 15 ) Other comprehensive income (loss) — — — — — 498 498 — 498 Dividends — — — — ( 2,063 ) — ( 2,063 ) — ( 2,063 ) Purchases of treasury stock — — — ( 8,265 ) — — ( 8,265 ) — ( 8,265 ) Share-based payments — — 315 26 — — 341 — 341 Balance at end of period $ — $ — $ 6,757 $ ( 79,670 ) $ 81,752 $ ( 935 ) $ 7,904 $ 15 $ 7,919 MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q 9 PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Statement of Changes in Equity (Unaudited) - (Continued) Stockholders' Equity Common Stock Additional Paid-In Capital Class A Treasury Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Mastercard Incorporated Stockholders' Equity Non- Controlling Interests Total Equity Class A Class B (in millions) Three Months Ended September 30, 2024 Balance at beginning of period $ — $ — $ 6,089 $ ( 65,067 ) $ 67,604 $ ( 1,205 ) $ 7,421 $ 39 $ 7,460 Net income — — — — 3,263 — 3,263 — 3,263 Activity related to non-controlling interests — — — — — — — ( 4 ) ( 4 ) Redeemable non-controlling interest adjustments — — — — ( 2 ) — ( 2 ) — ( 2 ) Other comprehensive income (loss) — — — — — 132 132 — 132 Dividends — — — — ( 607 ) — ( 607 ) — ( 607 ) Purchases of treasury stock — — — ( 2,969 ) — — ( 2,969 ) — ( 2,969 ) Share-based payments — — 201 1 — — 202 — 202 Balance at end of period $ — $ — $ 6,290 $ ( 68,035 ) $ 70,258 $ ( 1,073 ) $ 7,440 $ 35 $ 7,475 Nine Months Ended September 30, 2024 Balance at beginning of period $ — $ — $ 5,893 $ ( 60,429 ) $ 62,564 $ ( 1,099 ) $ 6,929 $ 46 $ 6,975 Net income — — — — 9,532 — 9,532 — 9,532 Activity related to non-controlling interests — — — — — — — ( 11 ) ( 11 ) Redeemable non-controlling interest adjustments — — — — ( 5 ) — ( 5 ) — ( 5 ) Other comprehensive income (loss) — — — — — 26 26 — 26 Dividends — — — — ( 1,833 ) — ( 1,833 ) — ( 1,833 ) Purchases of treasury stock — — — ( 7,615 ) — — ( 7,615 ) — ( 7,615 ) Share-based payments — — 397 9 — — 406 — 406 Balance at end of period $ — $ — $ 6,290 $ ( 68,035 ) $ 70,258 $ ( 1,073 ) $ 7,440 $ 35 $ 7,475 The accompanying notes are an integral part of these consolidated financial statements. 10 MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2025 2024 (in millions) Operating Activities Net income $ 10,908 $ 9,532 Adjustments to reconcile net income to net cash provided by operating activities: Amortization of customer incentives 1,526 1,328 Depreciation and amortization 846 666 (Gains) losses on equity investments, net ( 16 ) 69 Share-based compensation 485 418 Deferred income taxes 77 ( 261 ) Other 99 117 Changes in operating assets and liabilities: Accounts receivable ( 264 ) 99 Settlement assets ( 14 ) ( 743 ) Prepaid expenses ( 2,939 ) ( 2,776 ) Accrued litigation and legal settlements ( 4 ) ( 59 ) Restricted security deposits held for customers 180 23 Accounts payable ( 28 ) 59 Settlement obligations 102 731 Accrued expenses 658 671 Net change in other assets and liabilities 1,030 72 Net cash provided by operating activities 12,646 9,946 Investing Activities Purchases of investment securities available-for-sale ( 385 ) ( 414 ) Purchases of investments held-to-maturity ( 28 ) ( 98 ) Proceeds from sales of investment securities available-for-sale 192 171 Proceeds from maturities of investment securities available-for-sale 183 204 Proceeds from maturities of investments held-to-maturity 46 363 Purchases of property and equipment ( 377 ) ( 379 ) Capitalized software ( 548 ) ( 565 ) Other investing activities ( 24 ) ( 6 ) Net cash used in investing activities ( 941 ) ( 724 ) Financing Activities Purchases of treasury stock ( 8,169 ) ( 7,565 ) Dividends paid ( 2,072 ) ( 1,842 ) Proceeds from debt, net 1,242 3,960 Payment of debt ( 750 ) ( 1,336 ) Tax withholdings related to share-based payments ( 283 ) ( 175 ) Cash proceeds from employee stock plans 139 163 Other financing activities ( 100 ) — Net cash used in financing activities ( 9,993 ) ( 6,795 ) Effect of exchange rate changes on cash, cash equivalents, restricted cas

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Notes to consolidated financial statements (unaudited)

Notes to consolidated financial statements (unaudited) Note 1. Summary of Significant Accounting Policies Organization Mastercard Incorporated and its consolidated subsidiaries, including Mastercard International Incorporated ("Mastercard International" and together with Mastercard Incorporated, "Mastercard" or the "Company"), is a technology company in the global payments industry. Mastercard connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide by enabling electronic payments and making those payment transactions secure, simple, smart and accessible. Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Mastercard and its majority-owned and controlled entities, including any variable interest entities ("VIEs") for which the Company is the primary beneficiary. Investments in VIEs for which the Company is not considered the primary beneficiary are not consolidated and are accounted for as marketable, equity method or measurement alternative method investments and recorded in other assets on the consolidated balance sheets. At September 30, 2025 and December 31, 2024, there were no significant VIEs that required consolidation and the investments were not material to the consolidated financial statements. The Company consolidates acquisitions as of the date the Company has obtained a controlling financial interest. Intercompany transactions and balances have been eliminated in consolidation. The Company follows accounting principles generally accepted in the United States of America ("GAAP"). The balance sheet as of December 31, 2024 was derived from the audited consolidated financial statements as of December 31, 2024. The consolidated financial statements for the three and nine months ended September 30, 2025 and 2024 and as of September 30, 2025 are unaudited, and in the opinion of management, include all normal recurring adjustments t

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company's customers are generally billed weekly, with certain billings occurring on a monthly and quarterly basis. The frequency of billing is dependent upon the nature of the performance obligation and the underlying contractual terms. The Company does not typically offer extended payment terms to customers. The following table sets forth the location of the amounts recognized on the consolidated balance sheets from contracts with customers: September 30, 2025 December 31, 2024 (in millions) Receivables from contracts with customers Accounts receivable $ 3,874 $ 3,491 Contract assets Prepaid expenses and other current assets 162 210 Other assets 464 460 Deferred revenue 1 Other current liabilities 1,222 890 Other liabilities 378 449 1 Revenue recognized from performance obligations satisfied for the three and nine months ended September 30, 2025 was $ 838 million and $ 2,187 million, respectively . Note 4. Earnings Per Share The components of basic and diluted earnings per share ("EPS") for common shares were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 (in millions, except per share data) Numerator Net income $ 3,927 $ 3,263 $ 10,908 $ 9,532 Denominator Basic weighted-average shares outstanding 903 923 908 928 Dilutive stock options and stock units 1 2 1 2 Diluted weighted-average shares outstanding 1 905 925 909 930 Earnings per Share Basic $ 4.35 $ 3.54 $ 12.02 $ 10.27 Diluted $ 4.34 $ 3.53 $ 12.00 $ 10.25 Note: Table may not sum due to rounding. 1 For the periods presented, the calculation of diluted EPS excluded a minimal amount of anti-dilutive share-based payment awards. MASTERCARD SEPTEMBER 30, 2025 FORM 10-Q 13 PART I

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 5. Investments The Company's investments on the consolidated balance sheets include both available-for-sale and held-to-maturity debt securities (see Investments section below). The Company's strategic investments in equity securities of publicly traded and privately held companies are classified within other assets on the consolidated balance sheets (see Equity Investments section below). Investments Investments on the consolidated balance sheets consisted of the following: September 30, 2025 December 31, 2024 (in millions) Available-for-sale securities $ 316 $ 292 Held-to-maturity securities 1 19 38 Total investments $ 335 $ 330 1 Held-to-maturity securities represent investments in time deposits that mature within one year. The cost of these securities approximates fair value. Investment income on the consolidated statements of operations primarily consists of interest income generated from cash, cash equivalents, held-to maturity and available-for-sale investment securities, as well as realized gains and losses on the Company's investment securities. The realized gains and losses from the sales of available-for-sale securities for the three and nine months ended September 30, 2025 and 2024 were not material. Available-for-Sale Securities The major classes of the Company's available-for-sale investment securities and their respective amortized cost basis and fair values were as follows: September 30, 2025 December 31, 2024 Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value (in millions) Government and agency securities $ 60 $ — $ — $ 60 $ 80 $ — $ — $ 80 Corporate securities 221 1 — 222 187 1 — 188 Asset-backed securities 34 — — 34 24 — — 24 Total $ 315 $ 1 $ — $ 316 $ 291 $ 1 $ — $ 292 The Company's government and agency securities include U.S.

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table is a summary of the activity related to the Company's equity investments: Balance at December 31, 2024 Purchases Sales Changes in Fair Value 1 Other 2 Balance at September 30, 2025 (in millions) Marketable securities $ 237 $ — $ — $ 11 $ — $ 248 Nonmarketable securities 1,370 30 — 3 34 1,437 Total equity investments $ 1,607 $ 30 $ — $ 14 $ 34 $ 1,685 1 Recorded in gains (losses) on equity investments, net on the consolidated statemen

View on Read The Filing