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MasterCard profit beats as consumers feel more confident

A MasterCard logo is seen on a door outside a restaurant in New York, February 3, 2010. REUTERS/Shannon Stapleton
A MasterCard logo is seen on a door outside a restaurant in New York, February 3, 2010. REUTERS/Shannon Stapleton

(Reuters) - MasterCard Inc, the No.2 credit and debit card network, reported a quarterly profit that topped Wall Street estimates as more people across the globe opted to use cards instead of cash.

Higher consumer spending in the United States also helped to boost MasterCard's third-quarter profit. U.S. consumer spending spiked in the quarter as people felt more confident about their job prospects.

Cardholders made $676 billion of purchases worldwide in the quarter on a local currency basis, up 12 percent.

In the United States, purchase volume grew 7.4 percent, though this was below the growth of 13.7 percent in the year-earlier period.

MasterCard's customers, including banks and prepaid card companies across the world, had issued 1.9 billion of the company's cards as of September 30.

The company said net income rose 8 percent to $772 million, or $6.17 per share, from $717 million, or $5.63 per share, a year earlier.

Analysts on average were expecting the company to earn $5.92 per share, excluding one-time items, according to Thomson Reuters I/B/E/S.

Revenue rose 5 percent to $1.92 billion, but fell short of the $1.94 billion analysts had expected.

Shares of the company, which has a market value of about $56 billion, were up 1.4 percent at $459.46 on the New York Stock Exchange on Wednesday morning.

MasterCard's results bode well for top payment network Visa Inc, which is scheduled to report later in the day.

Visa shares were up 1 percent at $139.73.

(Reporting by Jochelle Mendonca in Bangalore; Editing by Sreejiraj Eluvangal, Supriya Kurane)

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