Mastercard NYSE: MA reported what Chief Executive Officer Michael Miebach called an “excellent start” to fiscal 2026, with first-quarter net revenue up 12% and net income up 15% year over year on a non-GAAP, currency-neutral basis. Management said consumer and business spending remained healthy, but noted increased uncertainty tied to geopolitical tensions that began to pressure cross-border travel late in the quarter.
First-quarter performance and spending trends
Chief Financial Officer Sachin Mehra said first-quarter operating expenses rose 9% on a currency-neutral basis, while operating income increased 13%. Net income rose 15% and EPS increased 18% to $4.60, which included a $0.10 benefit from share repurchases. Mastercard bought back $4 billion of stock during the quarter and another $1.7 billion through April 27, 2026, with Mehra saying the company “accelerated the pace” of buybacks based on valuation levels and long-term growth conviction.
On operating drivers, Mehra said worldwide gross dollar volume (GDV) rose 7% year over year on a local-currency basis. In the U.S., GDV increased 4%, reflecting 8% credit growth and 1% debit growth; excluding the impact of the Capital One debit portfolio migration, U.S. debit GDV growth would have been 7%. Mehra said the migration is “now basically complete.” Outside the U.S., volume grew 9%, with credit up 9% and debit up 8%.
Cross-border volume grew 13% globally in the quarter, with Mehra noting that “starting in March, we began to see some impact on cross-border travel from the conflict in the Middle East.” Switched transactions increased 9%, or 10% excluding the Capital One debit migration impact. Contactless penetration reached 78% of in-person switched purchase transactions, up 5 percentage points from a year earlier, and global card growth was 5% to 3.7 billion Mastercard and Maestro-branded cards issued.
Network and services growth, plus portfolio activity
Mehra said payment network net revenue increased 8% in the quarter on a currency-neutral basis, while value-added services and solutions (VASS) net revenue rose 18%, driven by demand across security solutions, digital and authentication, business and market insights, consumer acquisition and engagement, and pricing. In response to an analyst question, Mehra said the 18% VASS growth in Q1 had “no impact from acquisitions.”
Miebach highlighted several consumer payments wins, including an expanded partnership with CIB in Egypt that includes the conversion of an affluent portfolio and the “expected issuance of over 5 million new Mastercards over the term of the deal,” as well as a renewal and expansion with Westpac in Australia. He also pointed to momentum in premium products, saying U.S. World Legend cards have shown higher overall spend and “more than 3x higher cross-border spend” versus the U.S. World Elite portfolio on an average monthly basis since launch.
In commercial flows, Miebach said the U.S. Amazon Small Business co-brand card issued by U.S. Bank will move to Mastercard, citing Mastercard’s SME offerings such as savings and analytics tools. He also cited new fleet and distribution partners, including Free in the U.S., and ryd in Europe converting a closed-loop fleet program to open-loop Mastercard.
Mehra addressed incentives, telling analysts that in the second quarter the company expects rebates and incentives as a percentage of payment network assessments to be “slightly lower sequentially” versus Q1.
Geopolitical impacts and 2026 outlook
Management’s commentary repeatedly returned to the conflict in the Middle East. Miebach said geopolitical tensions have “put some pressure on cross-border travel,” while Mehra said Mastercard has seen “restrictions on travel and a reduction in the world’s energy supply” since the end of February, with impacts showing up in cross-border travel metrics.
For guidance, Mehra said the company’s base case assumes the conflict ends in Q2, with the “related headwinds” largest in Q2 and then progressively recovering in the second half. For Q2, Mastercard expects year-over-year net revenue growth at the low end of a low double-digit range on a currency-neutral basis, excluding inorganic activity, including the estimated conflict impact. Without the conflict, Mehra said Q2 growth would have been expected to be “generally in line” with Q1.
For the full year, Mehra maintained expectations for net revenue growth at the high end of a low double-digit range on a currency-neutral basis, excluding inorganic activity. He also reiterated expectations for a non-GAAP tax rate of 20% to 21% for Q2 and the full year, noting Q1’s tax rate was lower due to discrete benefits including those related to share-based payments.
On sizing, Mehra said that from a cross-border volume perspective, the GCC and Israel represent “roughly 6%” of the company’s cross-border volumes, including inbound and outbound flows.
Agentic commerce, stablecoins, and planned BVNK acquisition
Miebach emphasized Mastercard’s push into “agentic commerce,” saying the company is working with partners including Google, Microsoft, OpenAI, and others. He said “nearly all Mastercards around the world are now enabled for Mastercard Agent Pay,” and highlighted the Q1 launch of “Verifiable Intent,” which he described as a tamper-resistant record of what a user authorized when an AI agent acts on their behalf. Miebach said the FIDO Alliance is using Verifiable Intent as a foundation for setting security standards in the space. He also noted a partnership with Crossmint to integrate Agent Pay and Verifiable Intent, initially launching on the OpenClaw platform with plans to expand.
On stablecoins, Miebach described them as another rail to complement Mastercard’s network. He said crypto co-brand spend growth continued at a “healthy clip,” and noted OKX is expanding its Mastercard crypto card program into Europe. He also pointed to Mastercard’s efforts enabling stablecoin settlement and integrating stablecoins into Mastercard Move.
Miebach reiterated enthusiasm for Mastercard’s planned acquisition of BVNK, describing it as technology that can “send, receive, convert, and hold stablecoins,” addressing interoperability and bringing compliance and licensing capabilities. Asked about U.S. legislative uncertainty, Miebach said a potential digital-asset framework would be positive but “doesn’t hold us back,” citing existing use cases and regulatory developments in multiple markets. Mehra added that BVNK’s revenue model is “basis points on volume,” describing it as an addressable market Mastercard “doesn’t participate in today.”
Security, dispute tools, and data-driven services
Miebach said demand for VASS remains high, highlighting product examples across dispute resolution, cybersecurity, open finance, and consulting and marketing services. He said Ethoca-related dispute products grew about 25% year over year in the prior quarter and noted that Checkout.com will embed Ethoca alerts into its experience.
On cybersecurity, Miebach pointed to the 2024 acquisition of Recorded Future and said that after launching Mastercard Threat Intelligence last year, “more than 500 customers are already engaged.” He said partners have used the product to take down malicious domains tied to payment card theft affecting “over 10,000 e-commerce sites.” Miebach told analysts he expects security solutions to remain “a continued significant growth driver.”
Closing the call, Miebach said the company remains focused on execution while monitoring geopolitical developments, adding that the quarter “gave us some pause” regarding employee safety in the Middle East.
About Mastercard NYSE: MA
Mastercard Incorporated is a global payments technology company that operates a network connecting consumers, financial institutions, merchants, governments and businesses in more than 200 countries and territories. The company facilitates electronic payments and transaction processing for credit, debit and prepaid card products carrying the Mastercard brand, while also providing a range of payment-related services to issuers, acquirers and merchants. Its technology and network enable authorization, clearing and settlement of payments and support a broad set of use cases including point-of-sale, e-commerce and mobile payments.
Beyond core transaction processing, Mastercard offers a suite of value-added services such as fraud and risk management, identity and authentication tools, tokenization and digital wallet support, cross-border and commercial payment solutions, and data analytics and consulting services for merchants and financial partners.
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