Mastercard Investor Presentation — July 2019 - Mastercard

July 30, 2019 Mastercard Incorporated Second-Quarter 2019 Financial Results Conference Call

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July 30, 2019 Mastercard

2nd Quarter Selected Financial Performance

($ in millions, except per share data)

2Q 19 2Q 18 Currency

Non-GAAP1Non-GAAP1Non-GAAP Neutral

Net revenue $ 4,113 $ 3,665 12% 15%

Total operating expenses 1,716 1,504 14% 17%

Operating income 2,397 2,161 11% 15%

Operating margin 58.3 % 59.0 % (0.7) ppt (0.4) ppt

Net income $ 1,937 $ 1,744 11% 15%

Diluted EPS $ 1.89 $ 1.66 14% 17%

Effective tax rate 18.5 % 18.8 %

1 See Appendix A for Non-GAAP reconciliation.

Turning to page 3, you will see we continue to perform well. Here are a few highlights, on a currency-neutral

basis, and excluding both special items related to certain legal matters, as well as the impact of gains and

losses on the company's equity investments.

•Net Revenue grew 15% , driven by solid momentum in our core, and was slightly ahead of our

expectations due to stronger services growth. Acquisitions contributed a minimal amount to net revenue

•Total Operating Expenses increased 17% , which includes a 2 ppt increase related to acquisitions and a

5 ppt increase related to the differential in hedging gains and losses versus year ago. The remaining 10%

relates to our ongoing investment in strategic initiatives.

•Operating Income and Net Income each grew by 15% , reflecting our strong operating performance, and

each includes a 1 ppt reduction due to acquisitions.

•EPS was $1.89 , including a 2 cent drag related to our recent acquisitions. EPS growth was 17% year-

over-year, with share repurchases contributing 4 cents per share. During the quarter, we repurchased

Credit Debit/Prepaid$1,800

2Q18 2Q19 2Q18 2Q19 2Q18 2Q19$756 $796

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