Mastercard’s probe disclosure clouds profit beat

Mastercard Inc (MA.N) beat estimates for quarterly profit as consumer spending surged against a turbulent economy, but the card company’s disclosure of a probe by the U.S. Justice Department unnerved investors.

The regulator has demanded that Mastercard provide documents tied to its U.S. debit program and competition with other payments networks, the card company said. Visa reported a similar probe in January.

Shares of Mastercard pared gains to 1%, from as much as 2.2%, after the company forecast strong growth in the face of inflation.

Mastercard bet on resilient consumer spending through the year, as rising interest rates and stubborn inflation have had little impact on wealthier consumers who continue to spend on travel and entertainment.

“Consumer spending has remained remarkably resilient, and that despite continued economic uncertainty,” said CEO Michael Miebach on an analyst call, adding that while there are signs of inflation cooling, the banking sector has come under pressure.

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