Summary
Mastercard Inc. (MA) filed an 8-K on October 31, 2017, reporting its financial results for the third quarter of 2017. The filing primarily directs investors to the accompanying earnings release (Exhibit 99.1) for detailed operational and financial performance. A key aspect of this report is Mastercard's use of non-GAAP financial measures, which exclude the impact of specific litigation provisions recorded in prior quarters of 2017 and 2016. These adjustments are made to provide a clearer view of the company's ongoing operational performance and facilitate period-over-period comparisons. Investors should pay close attention to these non-GAAP figures, as management utilizes them for internal assessments and performance evaluations. The company also presents currency-neutral growth rates as a non-GAAP measure, aiming to offer insights into underlying business performance independent of foreign currency fluctuations. While these non-GAAP measures are considered useful for understanding operational trends, Mastercard emphasizes that they should be analyzed alongside, not as a replacement for, the company's GAAP financial results.
Key Highlights
- 1Mastercard released its Q3 2017 financial results on October 31, 2017, via an 8-K filing.
- 2The 8-K filing refers investors to Exhibit 99.1 (Earnings Release) for detailed Q3 2017 financial and operational information.
- 3The company utilized non-GAAP financial measures, excluding significant litigation provisions from prior periods (Q1 2017 Canadian merchant litigation, Q2 2016 UK merchant litigation).
- 4These non-GAAP measures include adjusted operating expenses, adjusted operating margin, adjusted effective income tax rate, adjusted net income, and adjusted diluted EPS.
- 5Mastercard management believes these non-GAAP measures provide a better understanding of ongoing operational performance and facilitate comparisons.
- 6Currency-neutral growth rates are also presented as a non-GAAP measure to isolate performance from foreign currency impacts.
- 7The filing includes reconciliations between GAAP and non-GAAP measures, with a disclaimer that non-GAAP measures are supplementary to GAAP results.