Mastercard Incorporated · Q2 2026 call

Net revenues were above our expectations, up 12%, adjusted net income up 16% and value-added services net revenue up 18%, all year-over-year on a non-GAAP currency-neutral basis. The macro environment remains supportive. Consumers and businesses are healthy and continue to spend, supported by positive job growth, low unemployment and real purchasing power in many major economies.

Building upon our acquisition of Recorded Future, we also launched Mastercard Threat Intelligence, specifically for payment fraud. In its first 3 quarters, Threat Intelligence has identified more than 7 million card testing transactions across 192 countries. Stopping that activity prevented an estimated $172 million in fraud linked to malicious domains.

Our value-added services and solutions growth engine is strong and durable. We benefit from the underlying market tailwinds in security, data and AI, personalization and more. There are also natural synergies between our value-add services and solutions and our payment network. That includes distribution. Today, about 60% of our value-add services and solutions net revenue is network linked.

We recently announced Mastercard Agent Pay for machines, which enables AI agents to purchase low-value digital services such as APIs, compute, data, content at machine speed. With on-chain permissioning and off-chain settlement, Mastercard is the only network enabling machine-to-machine payments. An ecosystem is rallying behind us. At launch, we had more than 30 industry leaders participating

There is clear utility for stablecoins, for example, in some B2B and P2P flows, but no problem to solve in P2M. In fact, digital asset players are choosing to partner with Mastercard to unlock trusted commerce at scale, benefiting from our global acceptance network, protections and security. We offer a wide variety of crypto co-branded propositions, and we're seeing strong traction. Our crypto co-brand volume has more than tripled over the last 2 years.

EPS was $5.04, which includes a $0.14 contribution from share repurchases. During the quarter, we repurchased $4.9 billion worth of stock and approximately $700 million of additional stock through July 27, 2026.

Switched transactions grew 9% year-over-year in Q2. We continue to drive contactless penetration, which in Q2 stood at 80% of all in-person switched purchase transactions. This is up 5 ppt since the same period last year. And token penetration reached over 40% of all switched transactions this quarter. In addition, card growth was 5%. Globally, there are 3.7 billion Mastercard and Maestro-branded cards issued.

Domestic assessments were up 10%, while worldwide GDV grew 8%. The 2 ppt difference is primarily driven by pricing. Cross-border assessments increased 20%, while cross-border volumes increased 12%. The 8 ppt difference is driven primarily by pricing in international markets and mix. Transaction processing assessments were up 12%, while switched transactions grew 9%.

In Q2, Mastercard delivered above expectations. This strong performance was broad-based with the upside primarily driven by lower-than-anticipated impact from the challenges in the Middle East, an uptick in cross-border spend out of Venezuela, where we are market leaders and strong demand for our value-added services and solutions.

As we look to the full year of 2026, we expect net revenue growth to be at the high end of low double-digit range on a currency-neutral basis, excluding inorganic activity. Although this is the same range we shared previously, we now expect to be higher within the range than our prior expectations, largely due to our stronger first half performance.

So fundamentally, a strong trend for us. But let's not forget, it's not maybe that sexy, but everyday fraud. I'll give you that example on the $172 million of fraud prevented on malicious domains. All that is powering our cybersecurity business today and it's attached to the transaction growth that we talked about all the transactions that we're going after. This is a flywheel that is very much needed right now.

winning share of a portfolio which is growing at 1% helps me in the first year and then is a huge drag on growth for the years thereafter. […] Volume for the sake of volume is not what this company should be chasing. Profitable volume, which is going to drive higher net revenue yield is what we're going to chase.

Well, thank you, Michael. I'm very excited about the new job, and I look forward to leading the next earnings call with you, but also my gratitude to Sachin for being such a wonderful CFO.