Mastercard Inc. shares were falling toward their worst day in two years Thursday as investors appeared uneasy with the company’s disclosure of a sequential growth slowdown for the month of October. Switched transactions growth came in at 15% for the third quarter, Mastercard
reported Thursday. But the company signaled that trends had decelerated so far in October, with switched volumes up 12% in the first three weeks of the month. Growth slowed in both the U.S. and internationally.
Chief Financial Officer Sachin Mehra told MarketWatch that the relative performance for October didn’t relate to business fundamentals. For one, the company is lapping portfolio wins, which brought new volume onboard but now makes for tougher comparisons. Additionally, he called out a difference in the timing of Social Security payments in the U.S. Last year, the payment took place in October, but this year it happened in late September, offering a tailwind to September-quarter results but meaning that people had less of that money to spend once October began. Additionally, investors might be “underappreciating” the impact of the strengthening U.S. dollar, he said. Mastercard previously thought foreign exchange would benefit fourth-quarter results by 3 to 4 percentage points, but now the company expects a tailwind ranging from flat to up a point. Shares of Mastercard were off 5.9% in afternoon trading and on pace to log their largest one-day percentage drop since Oct. 27, 2021, when they shed 6.1%. “I’m having hard time explaining the market reaction from my perspective,” Mehra sai …