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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2023
Or 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission file number: 001-32877
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Mastercard Incorporated
(Exact name of registrant as specified in its charter)
Delaware13-4172551
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification Number)
2000 Purchase Street10577
Purchase,NY(Zip Code)
(Address of principal executive offices)
(914) 249-2000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange of which registered
Class A Common Stock, par value $0.0001 per share
MA
New York Stock Exchange
2.1% Notes due 2027
MA27
New York Stock Exchange
1.0% Notes due 2029
MA29A
New York Stock Exchange
2.5% Notes due 2030
MA30
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files)
Yes


No


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check One):
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act)
YesNo
As of October 23, 2023, there were 930,438,307 shares outstanding of the registrant’s Class A common stock, par value $0.0001 per share; and 7,337,754 shares outstanding of the registrant’s Class B common stock, par value $0.0001 per share.



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MASTERCARD INCORPORATED FORM 10-Q
TABLE OF CONTENTS
PART I
PART II
Unregistered sales of equity securities, use of proceeds and issuer purchases of equity securities
-

2 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


In this Report on Form 10-Q (“Report”), references to the “Company,” “Mastercard,” “we,” “us” or “our” refer to the business conducted by Mastercard Incorporated and its consolidated subsidiaries, including our operating subsidiary, Mastercard International Incorporated, and to the Mastercard brand.
Forward-Looking Statements
This Report contains forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts may be forward-looking statements. When used in this Report, the words “believe”, “expect”, “could”, “may”, “would”, “will”, “trend” and similar words are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements that relate to the Company’s future prospects, developments and business strategies.
Many factors and uncertainties relating to our operations and business environment, all of which are difficult to predict and many of which are outside of our control, influence whether any forward-looking statements can or will be achieved. Any one of those factors could cause our actual results to differ materially from those expressed or implied in writing in any forward-looking statements made by Mastercard or on its behalf, including, but not limited to, the following factors:
regulation directly related to the payments industry (including regulatory, legislative and litigation activity with respect to interchange rates and surcharging)
the impact of preferential or protective government actions
regulation of privacy, data, security and the digital economy
regulation that directly or indirectly applies to us based on our participation in the global payments industry (including anti-money laundering, counter financing of terrorism, economic sanctions and anti-corruption, account-based payments systems, and issuer and acquirer practice regulation)
the impact of changes in tax laws, as well as regulations and interpretations of such laws or challenges to our tax positions
potential or incurred liability and limitations on business related to any litigation or litigation settlements
the impact of competition in the global payments industry (including disintermediation and pricing pressure)
the challenges relating to rapid technological developments and changes
the challenges relating to operating a real-time account-based payments system and to working with new customers and end users
the impact of information security incidents, account data breaches or service disruptions
issues related to our relationships with our stakeholders (including loss of substantial business from significant customers, competitor relationships with our customers, consolidation amongst our customers, merchants’ continued focus on acceptance costs and unique risks from our work with governments)
the impact of global economic, political, financial and societal events and conditions, including adverse currency fluctuations and foreign exchange controls as well as events and resulting actions related to the Russian invasion of Ukraine
the impact of the global COVID-19 pandemic and measures taken in response
reputational impact, including impact related to brand perception and lack of visibility of our brands in products and services
the impact of environmental, social and governance matters and related stakeholder reaction
the inability to attract and retain a highly qualified and diverse workforce, or maintain our corporate culture
issues related to acquisition integration, strategic investments and entry into new businesses
exposure to loss or illiquidity due to our role as guarantor and other contractual obligations
issues related to our Class A common stock and corporate governance structure
Please see a complete discussion of these risk factors in Part I, Item 1A - Risk Factors of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. We caution you that the important factors referenced above may not contain all of the factors that are important to you. Our forward-looking statements speak only as of the date of this Report or as of the date they are made, and we undertake no obligation to update our forward-looking statements.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 3


PART I



PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Item 1. Consolidated financial statements (unaudited)
Mastercard Incorporated
Index to consolidated financial statements (unaudited)
Page
Consolidated Statement of Operations — Three and Nine Months Ended September 30, 2023 and 2022
Consolidated Statement of Comprehensive Income — Three and Nine Months Ended September 30, 2023 and 2022
Consolidated Balance Sheet — September 30, 2023 and December 31, 2022
Consolidated Statement of Changes in Equity Three and Nine Months Ended September 30, 2023 and 2022
Consolidated Statement of Cash Flows — Nine Months Ended September 30, 2023 and 2022

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 5


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statement of Operations (Unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
 (in millions, except per share data)
Net Revenue$6,533 $5,756 $18,550 $16,420 
Operating Expenses:
General and administrative2,285 2,069 6,528 5,860 
Advertising and marketing193 182 561 573 
Depreciation and amortization211 185 594 566 
Provision for litigation 208 231 341 
Total operating expenses2,689 2,644 7,914 7,340 
Operating income3,844 3,112 10,636 9,080 
Other Income (Expense):
Investment income71 16 185 28 
Gains (losses) on equity investments, net(6)60 (95)(133)
Interest expense(151)(120)(427)(344)
Other income (expense), net3 4 19 12 
Total other income (expense)(83)(40)(318)(437)
Income before income taxes3,761 3,072 10,318 8,643 
Income tax expense563 573 1,914 1,238 
Net Income$3,198 $2,499 $8,404 $7,405 
Basic Earnings per Share$3.40 $2.59 $8.88 $7.63 
Basic weighted-average shares outstanding941 965 947 971 
Diluted Earnings per Share$3.39 $2.58 $8.85 $7.60 
Diluted weighted-average shares outstanding943 968 949 974 

The accompanying notes are an integral part of these consolidated financial statements.

6 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statement of Comprehensive Income (Unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
 (in millions)
Net Income$3,198 $2,499 $8,404 $7,405 
Other comprehensive income (loss):
Foreign currency translation adjustments(239)(743)(92)(1,517)
Income tax effect1 62 (13)105 
Foreign currency translation adjustments, net of income tax effect(238)(681)(105)(1,412)
Translation adjustments on net investment hedges138 372 53 772 
Income tax effect(31)(82)(12)(171)
Translation adjustments on net investment hedges, net of income tax effect107 290 41 601 
Cash flow hedges17 14 (7)21 
Income tax effect(4)(3)2 (5)
Reclassification adjustments for cash flow hedges12 (4)29 (9)
Income tax effect(3)1 (7)2 
Cash flow hedges, net of income tax effect22 8 17 9 
Reclassification adjustments for defined benefit pension and other postretirement plans   (1)
Income tax effect    
Defined benefit pension and other postretirement plans, net of income tax effect   (1)
Investment securities available-for-sale
1 (2)3 (6)
Income tax effect   1 
Investment securities available-for-sale, net of income tax effect1 (2)3 (5)
Other comprehensive income (loss), net of income tax effect(108)(385)(44)(808)
Comprehensive Income$3,090 $2,114 $8,360 $6,597 

The accompanying notes are an integral part of these consolidated financial statements.


MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 7


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Balance Sheet (Unaudited)
September 30, 2023December 31, 2022
 (in millions, except per share data)
Assets
Current assets:
Cash and cash equivalents$6,890 $7,008 
Restricted cash for litigation settlement 589 
Investments602 400 
Accounts receivable3,925 3,425 
Settlement assets1,118 1,270 
Restricted security deposits held for customers1,824 1,568 
Prepaid expenses and other current assets2,624 2,346 
Total current assets16,983 16,606 
Property, equipment and right-of-use assets, net of accumulated depreciation and amortization of $2,140 and $1,904, respectively
1,972 2,006 
Deferred income taxes1,370 1,151 
Goodwill7,488 7,522 
Other intangible assets, net of accumulated amortization of $2,137 and $1,960, respectively
4,022 3,859 
Other assets7,839 7,580 
Total Assets$39,674 $38,724 
Liabilities, Redeemable Non-controlling Interests and Equity
Current liabilities:
Accounts payable$589 $926 
Settlement obligations992 1,111 
Restricted security deposits held for customers1,824 1,568 
Accrued litigation475 1,094 
Accrued expenses7,775 7,801 
Short-term debt1,337 274 
Other current liabilities1,527 1,397 
Total current liabilities14,519 14,171 
Long-term debt14,229 13,749 
Deferred income taxes385 393 
Other liabilities4,160 4,034 
Total Liabilities33,293 32,347 
Commitments and Contingencies
Redeemable Non-controlling Interests21 21 
Stockholders’ Equity
Class A common stock, $0.0001 par value; authorized 3,000 shares, 1,401 and 1,399 shares issued and 932 and 948 shares outstanding, respectively
  
Class B common stock, $0.0001 par value; authorized 1,200 shares, 7 and 8 shares issued and outstanding, respectively
  
Additional paid-in-capital5,791 5,298 
Class A treasury stock, at cost, 470 and 451 shares, respectively
(58,573)(51,354)
Retained earnings60,390 53,607 
Accumulated other comprehensive income (loss)(1,297)(1,253)
Mastercard Incorporated Stockholders' Equity6,311 6,298 
Non-controlling interests49 58 
Total Equity6,360 6,356 
Total Liabilities, Redeemable Non-controlling Interests and Equity$39,674 $38,724 

The accompanying notes are an integral part of these consolidated financial statements.

8 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statement of Changes in Equity (Unaudited)
Three Months Ended September 30, 2023
Stockholders’ Equity
Common StockAdditional
Paid-In
Capital
Class A
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Mastercard Incorporated Stockholders’ EquityNon-
Controlling
Interests
Total Equity
Class AClass B
(in millions)
Balance at June 30, 2023$ $ $5,622 $(56,659)$57,730 $(1,189)$5,504 $53 $5,557 
Net income— — — — 3,198 — 3,198 — 3,198 
Activity related to non-controlling interests— — — — — — — (4)(4)
Redeemable non-controlling interest adjustments— — — — (2)— (2)— (2)
Other comprehensive income (loss)— — — — — (108)(108)— (108)
Dividends— — — — (536)— (536)— (536)
Purchases of treasury stock— — — (1,915)— — (1,915)— (1,915)
Share-based payments— — 169 1 — — 170 — 170 
Balance at September 30, 2023$ $ $5,791 $(58,573)$60,390 $(1,297)$6,311 $49 $6,360 
Nine Months Ended September 30, 2023
Stockholders’ Equity
  
Common Stock
Additional
Paid-In
Capital
Class A
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Mastercard Incorporated Stockholders' EquityNon-
Controlling
Interests
Total
Equity
 Class AClass B
 (in millions)
Balance at December 31, 2022$ $ $5,298 $(51,354)$53,607 $(1,253)$6,298 $58 $6,356 
Net income— — — — 8,404 — 8,404 — 8,404 
Activity related to non-controlling interests— — — — — — — (9)(9)
Redeemable non-controlling interest adjustments — — — — (6)— (6)— (6)
Other comprehensive income (loss)— — — — — (44)(44)— (44)
Dividends— — — — (1,615)— (1,615)— (1,615)
Purchases of treasury stock— — — (7,232)— — (7,232)— (7,232)
Share-based payments— — 493 13 — — 506 — 506 
Balance at September 30, 2023$ $ $5,791 $(58,573)$60,390 $(1,297)$6,311 $49 $6,360 

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 9


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statement of Changes in Equity (Unaudited) - (Continued)
Three Months Ended September 30, 2022
Stockholders’ Equity
Common StockAdditional
Paid-In
Capital
Class A
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Mastercard Incorporated Stockholders’ EquityNon-
Controlling
Interests
Total Equity
Class AClass B
(in millions)
Balance at June 30, 2022$ $ $5,163 $(47,359)$49,599 $(1,232)$6,171 $65 $6,236 
Net income— — — — 2,499 — 2,499 — 2,499 
Activity related to non-controlling interests— — — — — — — (3)(3)
Redeemable non-controlling interest adjustments— — — — (1)— (1)— (1)
Other comprehensive income (loss)— — — — — (385)(385)— (385)
Dividends— — — — (472)— (472)(472)
Purchases of treasury stock— — — (1,557)— — (1,557)— (1,557)
Share-based payments— — 106 — — — 106 — 106 
Balance at September 30, 2022$ $ $5,269 $(48,916)$51,625 $(1,617)$6,361 $62 $6,423 

Nine Months Ended September 30, 2022
Stockholders’ Equity
  
Common Stock
Additional
Paid-In
Capital
Class A
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Mastercard Incorporated Stockholders' EquityNon-
Controlling
Interests
Total
Equity
 Class AClass B
 (in millions)
Balance at December 31, 2021$ $ $5,061 $(42,588)$45,648 $(809)$7,312 $71 $7,383 
Net income— — — — 7,405 — 7,405 — 7,405 
Activity related to non-controlling interests— — — — — — — (9)(9)
Redeemable non-controlling interest adjustments— — — — (5)— (5)— (5)
Other comprehensive income (loss)— — — — — (808)(808)— (808)
Dividends— — — — (1,423)— (1,423)— (1,423)
Purchases of treasury stock— — — (6,333)— — (6,333)— (6,333)
Share-based payments— — 208 5 — — 213 — 213 
Balance at September 30, 2022$ $ $5,269 $(48,916)$51,625 $(1,617)$6,361 $62 $6,423 

The accompanying notes are an integral part of these consolidated financial statements.

10 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statement of Cash Flows (Unaudited)
 Nine Months Ended September 30,
 20232022
 (in millions)
Operating Activities
Net income$8,404 $7,405 
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of customer and merchant incentives1,196 1,197 
Depreciation and amortization594 566 
(Gains) losses on equity investments, net95 133 
Share-based compensation374 273 
Deferred income taxes(239)(589)
Other88 40 
Changes in operating assets and liabilities:
Accounts receivable(484)(326)
Settlement assets151 298 
Prepaid expenses(1,837)(1,472)
Accrued litigation and legal settlements(621)249 
Restricted security deposits held for customers240 (342)
Accounts payable(319)(91)
Settlement obligations(119)146 
Accrued expenses43 638 
Net change in other assets and liabilities284 (30)
Net cash provided by operating activities7,850 8,095 
Investing Activities
Purchases of investment securities available-for-sale(244)(192)
Purchases of investments held-to-maturity(327)(174)
Proceeds from sales of investment securities available-for-sale72 28 
Proceeds from maturities of investment securities available-for-sale155 156 
Proceeds from maturities of investments held-to-maturity116 194 
Purchases of property and equipment(294)(312)
Capitalized software(525)(446)
Purchases of equity investments(61)(62)
Proceeds from sales of equity investments44 7 
Acquisition of businesses, net of cash acquired (313)
Other investing activities(73)(6)
Net cash used in investing activities(1,137)(1,120)
Financing Activities
Purchases of treasury stock(7,200)(6,339)
Dividends paid(1,624)(1,430)
Proceeds from debt, net1,554 1,127 
Tax withholdings related to share-based payments(81)(137)
Cash proceeds from exercise of stock options213 77 
Other financing activities (12)
Net cash used in financing activities(7,138)(6,714)
Effect of exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents(29)(387)
Net decrease in cash, cash equivalents, restricted cash and restricted cash equivalents(454)(126)
Cash, cash equivalents, restricted cash and restricted cash equivalents - beginning of period9,196 9,902 
Cash, cash equivalents, restricted cash and restricted cash equivalents - end of period$8,742 $9,776 

The accompanying notes are an integral part of these consolidated financial statements.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 11


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Notes to consolidated financial statements (unaudited)
Note 1. Summary of Significant Accounting Policies
Organization
Mastercard Incorporated and its consolidated subsidiaries, including Mastercard International Incorporated (“Mastercard International” and together with Mastercard Incorporated, “Mastercard” or the “Company”), is a global technology company in the payments industry. Mastercard connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide by enabling electronic forms of payment instead of cash and checks and making those payment transactions safe, simple, smart and accessible.
Consolidation and Basis of Presentation
The consolidated financial statements include the accounts of Mastercard and its majority-owned and controlled entities, including any variable interest entities (“VIEs”) for which the Company is the primary beneficiary. Investments in VIEs for which the Company is not considered the primary beneficiary are not consolidated and are accounted for as marketable, equity method or measurement alternative method investments and recorded in other assets on the consolidated balance sheet. At September 30, 2023 and December 31, 2022, there were no significant VIEs which required consolidation and the investments were not considered material to the consolidated financial statements. The Company consolidates acquisitions as of the date the Company has obtained a controlling financial interest. Intercompany transactions and balances have been eliminated in consolidation. During the fourth quarter of 2022, the Company updated its disaggregated net revenue presentation by category and geography to reflect the nature of its payment services and to align such information with the way in which management views its categories of net revenue. Prior period amounts have been reclassified to conform to the 2022 presentation. The reclassification had no impact on previously reported total net revenue, operating income or net income. The Company follows accounting principles generally accepted in the United States of America (“GAAP”).
The balance sheet as of December 31, 2022 was derived from the audited consolidated financial statements as of December 31, 2022. The consolidated financial statements for the three and nine months ended September 30, 2023 and 2022 and as of September 30, 2023 are unaudited, and in the opinion of management, include all normal recurring adjustments that are necessary to present fairly the results for interim periods. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year.
The accompanying unaudited consolidated financial statements are presented in accordance with the U.S. Securities and Exchange Commission (“SEC”) requirements for Quarterly Reports on Form 10-Q. Reference should be made to Mastercard’s Annual Report on Form 10-K for the year ended December 31, 2022 for additional disclosures, including a summary of the Company’s significant accounting policies.
Note 2. Acquisitions
In April 2022, Mastercard acquired 100% equity interest in Dynamic Yield LTD. As of March 31, 2023, the Company finalized the purchase price accounting of $325 million for this acquisition. The final fair value of the purchase price allocation was not materially different than the preliminary estimated fair value. For the preliminary estimated fair value of the purchase price allocation as of the acquisition date, refer to Note 2 (Acquisitions) to the consolidated financial statements included in Part II, Item 8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

12 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 3. Revenue
The Company’s disaggregated net revenue by category and geographic region were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
(in millions)
Net revenue by category:
Payment network$4,210 $3,765 $11,933 $10,773 
Value-added services and solutions2,323 1,991 6,617 5,647 
Net revenue$6,533 $5,756 $18,550 $16,420 
Net revenue by geographic region:
North American Markets 1
$2,109 $2,031 $6,143 $5,769 
International Markets4,424 3,725 12,407 10,651 
Net revenue$6,533 $5,756 $18,550 $16,420 
1North American Markets includes the United States and Canada, excluding the U.S. Territories.
The Company’s customers are generally billed weekly, with certain billings occurring on a monthly and quarterly basis. The frequency of billing is dependent upon the nature of the performance obligation and the underlying contractual terms. The Company does not typically offer extended payment terms to customers. The following table sets forth the location of the amounts recognized on the consolidated balance sheet from contracts with customers:
September 30,
2023
December 31,
2022
(in millions)
Receivables from contracts with customers
Accounts receivable
$3,666 $3,213 
Contract assets
Prepaid expenses and other current assets105 118 
Other assets390 442 
Deferred revenue 1
Other current liabilities548 434 
Other liabilities300 248 
1    Revenue recognized from performance obligations satisfied during the three and nine months ended September 30, 2023 was $533 million and $1,362 million, respectively.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 13


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4. Earnings Per Share
The components of basic and diluted earnings per share (“EPS”) for common shares were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
(in millions, except per share data)
Numerator
Net income$3,198 $2,499 $8,404 $7,405 
Denominator
Basic weighted-average shares outstanding941 965 947 971 
Dilutive stock options and stock units2 3 2 3 
Diluted weighted-average shares outstanding 1
943 968 949 974 
Earnings per Share
Basic$3.40 $2.59 $8.88 $7.63 
Diluted$3.39 $2.58 $8.85 $7.60 
Note: Table may not sum due to rounding.
1    For the periods presented, the calculation of diluted EPS excluded a minimal amount of anti-dilutive share-based payment awards.
Note 5. Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents
The following table provides the components of cash, cash equivalents, restricted cash and restricted cash equivalents reported on the consolidated balance sheet that total to the amounts shown on the consolidated statement of cash flows.
September 30,
2023
December 31,
2022
(in millions)
Cash and cash equivalents$6,890 $7,008 
Restricted cash and restricted cash equivalents
Restricted cash for litigation settlement 1
 589 
Restricted security deposits held for customers1,824 1,568 
Prepaid expenses and other current assets28 31 
Cash, cash equivalents, restricted cash and restricted cash equivalents$8,742 $9,196 
1During the three months ended September 30, 2023, the Company reduced its Restricted cash for litigation settlement balance by $600 million, including accrued interest, as a settlement became final in August 2023. See Note 15 (Legal and Regulatory Proceedings) for additional information regarding the Company’s restricted cash for litigation settlement.
Note 6. Investments
The Company’s investments on the consolidated balance sheet include both available-for-sale and held-to-maturity debt securities (see Investments section below). The Company classifies its investments in equity securities of publicly traded and privately held companies within other assets on the consolidated balance sheet (see Equity Investments section below).
Investments
Investments on the consolidated balance sheet consisted of the following:
September 30,
2023
December 31,
2022
(in millions)
Available-for-sale securities 1
$276 $272 
Held-to-maturity securities 2
326 128 
Total investments $602 $400 
1See Available-for-Sale Securities section below for further detail.
2Held-to-maturity securities represent investments in time deposits that mature within one year. The cost of these securities approximates fair value.

14 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Investment income on the consolidated statement of operations primarily consists of interest income generated from cash, cash equivalents, held-to maturity and available-for-sale investment securities, as well as realized gains and losses on the Company’s investment securities. The realized gains and losses from the sales of available-for-sale securities for the three and nine months ended September 30, 2023 and 2022 were not material.
Available-for-Sale Securities
The major classes of the Company’s available-for-sale investment securities and their respective amortized cost basis and fair values were as follows:
 September 30, 2023December 31, 2022
 Amortized
Cost
Gross
Unrealized
Gain
Gross
Unrealized
Loss
Fair
Value
Amortized
Cost
Gross
Unrealized
Gain
Gross
Unrealized
Loss
Fair
Value
(in millions)
Government and agency securities$93 $ $(1)$92 $91 $ $(2)$89 
Corporate securities186  (2)184 187  (4)183 
Total$279 $ $(3)$276 $278 $ $(6)$272 
The Company’s government and agency securities include U.S. government bonds, U.S. government sponsored agency bonds and foreign government bonds which are denominated in the national currency of the issuing country. Corporate available-for-sale investment securities held at September 30, 2023 and December 31, 2022 primarily carried a credit rating of A- or better. Corporate securities are comprised of commercial paper and corporate bonds. Unrealized gains and losses are recorded as a separate component of other comprehensive income (loss) on the consolidated statement of comprehensive income.
The maturity distribution based on the contractual terms of the Company’s available-for-sale investment securities at September 30, 2023 was as follows:
 
 Amortized CostFair Value
 (in millions)
Due within 1 year$161 $160 
Due after 1 year through 5 years118 116 
Total$279 $276 
Equity Investments
Included in other assets on the consolidated balance sheet are equity investments with readily determinable fair values (“Marketable securities”) and equity investments without readily determinable fair values (“Nonmarketable securities”). Marketable securities are equity interests in publicly traded companies and are measured using unadjusted quoted prices in their respective active markets. Nonmarketable securities that do not qualify for equity method accounting are measured at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for the identical or similar investments of the same issuer (“Measurement alternative”).
The following table is a summary of the activity related to the Company’s equity investments:
 Balance at December 31, 2022PurchasesSales
Changes in Fair Value 1
Other 2
Balance at September 30, 2023
(in millions)
Marketable securities $399 $ $ $58 $ $457 
Nonmarketable securities1,331 61 (44)(153)(2)1,193 
Total equity investments $1,730 $61 $(44)$(95)$(2)$1,650 
1Recorded in gains (losses) on equity investments, net on the consolidated statement of operations.
2Includes translational impact of currency.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 15


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table sets forth the components of the Company’s Nonmarketable securities:
September 30,
2023
December 31,
2022
(in millions)
Measurement alternative
$985 $1,087 
Equity method
208 244 
Total Nonmarketable securities$1,193 $1,331 
The following table summarizes the total carrying value of the Company’s Measurement alternative investments, including cumulative unrealized gains and losses through September 30, 2023:
(in millions)
Initial cost basis
$534 
Cumulative adjustments 1:
Upward adjustments629 
Downward adjustments (including impairment)(178)
Carrying amount, end of period$985 
1 Includes immaterial translational impact of currency.
The following table summarizes the unrealized gains and losses included in the carrying value of the Company’s Measurement alternative investments and Marketable securities:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
(in millions)
Measurement alternative investments:
Upward adjustments$1 $4 $7 $107 
Downward adjustments (including impairment)(7) (142)(12)
Marketable securities:
Unrealized gains (losses), net3 79 58 (209)
Note 7. Fair Value Measurements
The Company’s financial instruments are carried at fair value, cost or amortized cost on the consolidated balance sheet. The Company classifies its fair value measurements of financial instruments into a three-level hierarchy (the “Valuation Hierarchy”).
Financial Instruments - Carried at Fair Value
Financial instruments carried at fair value are categorized for fair value measurement purposes as recurring or non-recurring in nature.

16 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Recurring Measurements
The distribution of the Company’s financial instruments measured at fair value on a recurring basis within the Valuation Hierarchy were as follows:
 September 30, 2023December 31, 2022
 Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
TotalQuoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Total
(in millions)
Assets
Investment securities available-for-sale 1:
Government and agency securities$37 $55 $ $92 $35 $54 $ $89 
Corporate securities 184  184  183  183 
Derivative instruments 2:
Foreign exchange contracts 120  120  108  108 
Marketable securities 3:
Equity securities457   457 399   399 
Deferred compensation plan 4:
Deferred compensation assets84   84 74   74 
Liabilities
Derivative instruments 2:
Foreign exchange contracts$ $22 $ $22 $ $21 $ $21 
Interest rate contracts  109  109  105  105 
Deferred compensation plan 5:
Deferred compensation liabilities83   83 73   73 
1The Company’s U.S. government securities are classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices for identical assets in active markets. The fair value of the Company’s available-for-sale non-U.S. government and agency securities and corporate securities are based on observable inputs such as quoted prices, benchmark yields and issuer spreads for similar assets in active markets and are therefore included in Level 2 of the Valuation Hierarchy.
2The Company’s foreign exchange and interest rate derivative asset and liability contracts have been classified within Level 2 of the Valuation Hierarchy as the fair value is based on observable inputs such as broker quotes for similar derivative instruments. See Note 17 (Derivative and Hedging Instruments) for further details.
3The Company’s Marketable securities are publicly held and classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices in their respective active markets.
4The Company has a nonqualified deferred compensation plan where assets are invested primarily in mutual funds held in a rabbi trust, which is restricted for payments to participants of the plan. The Company has elected to use the fair value option for these mutual funds and are classified within Level 1 of the Valuation Hierarchy, which are measured using quoted prices of identical instruments in active markets and are included in prepaid expenses and other current assets on the consolidated balance sheet.
5The deferred compensation liabilities are classified within Level 1 of the Valuation Hierarchy as the fair value is measured based on the quoted prices of identical instruments to the investment vehicles selected by the participants. These are included in other liabilities on the consolidated balance sheet.
Nonrecurring Measurements
Nonmarketable Securities
The Company’s Nonmarketable securities are recorded at fair value on a nonrecurring basis in periods after initial recognition under the equity method or measurement alternative method. Nonmarketable securities are classified within Level 3 of the Valuation Hierarchy due to the absence of quoted market prices, the inherent lack of liquidity and unobservable inputs used to measure fair value that require management’s judgment. The Company uses discounted cash flows and market assumptions to estimate the fair value of its Nonmarketable securities when certain events or circumstances indicate that impairment may exist. See Note 6 (Investments) for further details.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 17


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Financial Instruments - Not Carried at Fair Value
Debt
Debt instruments are carried on the consolidated balance sheet at amortized cost. The Company estimates the fair value of its debt based on either market quotes or observable market data. Debt is classified as Level 2 of the Valuation Hierarchy as it is generally not traded in active markets. At September 30, 2023, the carrying value and fair value of debt was $15.6 billion and $13.8 billion, respectively. At December 31, 2022, the carrying value and fair value of debt was $14.0 billion and $12.7 billion, respectively. See Note 10 (Debt) for further details.
Other Financial Instruments
Certain other financial instruments are carried on the consolidated balance sheet at cost or amortized cost basis, which approximates fair value due to their short-term, highly liquid nature. These instruments include cash and cash equivalents, restricted cash, time deposits, accounts receivable, settlement assets, restricted security deposits held for customers, accounts payable, settlement obligations and other accrued liabilities.
Note 8. Prepaid Expenses and Other Assets
Prepaid expenses and other current assets consisted of the following:
September 30,
2023
December 31,
2022
(in millions)
Customer and merchant incentives$1,533 $1,392 
Prepaid income taxes24 34 
Other1,067 920 
Total prepaid expenses and other current assets$2,624 $2,346 
Other assets consisted of the following:
September 30,
2023
December 31,
2022
(in millions)
Customer and merchant incentives$4,917 $4,578 
Equity investments1,650 1,730 
Income taxes receivable654 633 
Other618 639 
Total other assets$7,839 $7,580 
Customer and merchant incentives represent payments made to customers and merchants under business agreements. Payments made directly related to entering into such an agreement are generally capitalized and amortized over the life of the agreement.
Note 9. Accrued Expenses and Accrued Litigation
Accrued expenses consisted of the following:
September 30,
2023
December 31,
2022
 (in millions)
Customer and merchant incentives$5,667 $5,600 
Personnel costs996 1,322 
Income and other taxes555 279 
Other557 600 
Total accrued expenses$7,775 $7,801 
Customer and merchant incentives represent amounts to be paid to customers under business agreements. As of September 30, 2023 and December 31, 2022, long-term customer and merchant incentives included in other liabilities were $2,542 million and $2,293 million, respectively.

18 MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of September 30, 2023 and December 31, 2022, the Company’s provision for litigation was $475 million and $1,094 million, respectively. These amounts are not included in the accrued expenses table above and are separately reported as accrued litigation on the consolidated balance sheet. The decrease during the nine months ended September 30, 2023 is primarily due to a $600 million decrease in the Company’s provision for litigation after a settlement became final in August 2023. See Note 15 (Legal and Regulatory Proceedings) for additional information regarding the Company’s accrued litigation.

MASTERCARD SEPTEMBER 30, 2023 FORM 10-Q 19


PART I
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 10. Debt
Debt consisted of the following:
September 30,
2023
December 31,
2022
Effective
Interest Rate
(in millions)
Senior Notes
2023 USD Notes4.875 %Senior Notes due March 2028$750 $ 5.003 %
4.850 %Senior Notes due March 2033750  4.923 %
2022 EUR Notes 1
1.000 %Senior Notes due February 2029794 800 1.138 %
2021 USD Notes2.000 %Senior Notes due November 2031750 750 2.112 %
1.900 %Senior Notes due March 2031600 600 1.981 %
2.950 %Senior Notes due March 2051700 700 3.013 %
2020 USD Notes3.300 %Senior Notes due March 20271,000 1,000 3.420 %
3.350 %Senior Notes due March 20301,500 1,500 3.430 %
3.850 %Senior Notes due March 20501,500 1,500 3.896 %
2019 USD Notes2.950 %Senior Notes due June 20291,000 1,000 3.030 %
3.650 %Senior Notes due June 20491,000 1,000 3.689 %
2.000 %Senior Notes due March 2025750 750 2.147 %
2018 USD Notes3.500 %Senior Notes due February 2028500 500 3.598 %
3.950 %Senior Notes due February 2048