(Reuters) - Mastercard (N:MA) on Tuesday joined bigger rival Visa (N:V) in reporting stronger-than-expected earnings for the third quarter, as it benefited from more Americans swiping their credit cards for everything from gasoline to groceries.
The company's shares rose 2.1 percent to $195 in premarket trading.
Consumer confidence has been rising, with levels hitting their highest in 18 years last month. That, coupled with higher wages, led to an overall growth in purchasing power, benefiting companies like Mastercard and its bigger peer, Visa.
Mastercard's gross dollar volume, which refers to the dollar value of transactions processed, rose 9 percent to $1.47 trillion in the quarter.
Rising oil prices during the quarter also helped lift the gross dollar volumes for payments processors. Benchmark Brent crude oil price (LCOc1) rose 7 percent in the reported quarter.
The Purchase-New York based company processed 23.12 billion transactions worldwide in the quarter, up 19.2 percent. Its customers had issued 2.5 billion Mastercard and Maestro-branded cards, as of Sept. 30.
Net income climbed to a record $1.90 billion, or $1.82 per share, in the three months ended Sept. 30, from $1.43 billion, or $1.34 per share, a year earlier.
On an adjusted basis, the company earned $1.78 per share, trouncing estimates of $1.68 per share, according to Refinitiv data.
The company's net revenue jumped 14.7 percent to $3.90 billion.