(Bloomberg) -- Visa Inc (NYSE:V). and Mastercard Inc (NYSE:MA). fell in early trading as both companies saw slowing growth in customers’ spending abroad as they contend with a stronger U.S. dollar.
The U.S. dollar strengthened 5 percent against other major currencies in the three months ended June 30, its biggest advance since 2016. That helped limit Mastercard’s cross-border volume to 14 percent growth during the second quarter, compared with 21 percent in the first quarter. At Visa, growth also slowed to 15 percent in the period.
“We see the U.S. dollar as the key near-term risk for the networks,” Donald Fandetti, an analyst at Wells Fargo (NYSE:WFC) & Co., said in a note to clients.
Both companies’ stocks dropped in early trading in New York. Visa’s shares declined 1.2 percent at 9:03 a.m. in New York trading, while Mastercard’s stock dropped 2.5 percent.
Still, both companies topped analysts’ estimates for revenue and earnings in the quarter. Visa’s overall purchase volume also surpassed forecasts, while Mastercard’s total volume fell short of estimates.
Visa said Wednesday it now expects adjusted profit to rise by a percentage in the “low 30s” compared with its previous forecast in the “high 20s.” Mastercard left its forecast for full-year adjusted revenue and operating expenses unchanged.
Here are other key metrics from Visa and Mastercard’s earnings, which the companies announced in separate statements on Wednesday and Thursday, respectively:
- Visa’s net income jumped 13 percent to $2.32 billion, or $1 a share, from $2.06 billion, or 86 cents, a year earlier. On an adjusted basis, profit was $1.20 a share, more than analysts’ estimates of $1.08.
- Mastercard’s net income climbed 33 percent to $1.6 billion, or $1.50 a share, from $1.2 billion, or $1.10, a year earlier. Adjusted per-share earnings were $1.66, topping analysts’ estimates of $1.53.
