Visa Inc. (NYSE:V) and Mastercard Incorporated (NYSE:MA) both beat Wall Street’s profit estimates this earnings season on resilient consumer spending and a World Cup travel boost. However, Visa’s stock fell on the news while Mastercard’s jumped, and the difference came down to what else each company announced alongside its numbers.
Why One Beat Got Punished and the Other Got Rewarded
Visa Inc. (NYSE:V) reported its results the same day it disclosed cutting 2,600 jobs, about 7% of its workforce, noting AI as a factor in reshaping how the firm works, and it took a $563 million charge for the cuts. Shares slid roughly 1% even after profit beat estimates. Mastercard, two days later, posted an even bigger percentage profit jump, and its stock rose more than 3%. Zacks’ Brian Mulberry said AI now lets Visa “maintain or expand output in priority areas while trimming headcount.”
This makes you wonder: did investors just reward the cleaner story, or is Visa’s AI-driven restructuring actually the smarter long-term move the market hasn’t given it credit for yet?
Visa’s Bull and Bear Case
Profit rose 8% to $6.3 billion, or $3.32 a share, beating the $3.23 analysts expected, and revenue rose 14% to $11.6 billion. Payments volume topped $4 trillion for the first time ever, and cross-border volume growth actually accelerated to 13% from 12% a year earlier, helped by the World Cup, which pushed card-present spending up as much as 20% in host cities on match days. CEO Ryan McInerney said consumer and business spending “remains resilient.”
However, Visa Inc. (NYSE:V) shares still fell about 1% despite the beat, operating expenses jumped 19% to $4.8 billion on personnel costs tied to the layoffs, and the $563 million charge is a real, immediate cost even if the AI-driven changes pay off later.
Mastercard’s Bull and Bear Case
Adjusted profit jumped 21% to $5.04 a share, well ahead of the $4.77 analysts expected, and revenue rose 14% to $9.3 billion. Gross dollar volume rose 8% to $2.9 trillion, and value-added services revenue, things like fraud detection and data analytics, grew 20%. JPMorgan’s Tien-tsin Huang called the results “comfortably ahead of guidance and expectations.”
Still, Mastercard Incorporated (NYSE:MA)’s cross-border volume growth actually slowed to 12% from 15% a year earlier, even though it still beat the 10.6% analysts expected. The company is mid-reshuffle, with a new CFO taking over August 3 while it reportedly explores possible divestments.
Insider Monkey’s Hedge Fund Data
Insider Monkey’s hedge fund database shows Visa Inc. (NYSE:V) had 181 hedge fund holders as of Q1 2026, down slightly from 184 the quarter before. Mastercard had 157 holders, up from 150. Visa still has more hedge funds behind it in absolute terms, though its holder count slipped while Mastercard’s grew heading into this year. Among payment peers, American Express had 83 holders, flat from the quarter before, and PayPal had 76, down from 78. Visa and Mastercard Incorporated (NYSE:MA) both comfortably outdraw those two.
Conclusion
Visa is still the bigger, more widely held firm by every measure that matters, with more hedge fund holders, a larger payments network, and a business that just crossed $4 trillion in quarterly volume for the first time. However, last week, Mastercard rewarded its clean beat and punished Visa for pairing its own beat with a round of layoffs, even ones the company frames as a step toward better long-term efficiency.
While we acknowledge the risk and potential of V as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than V and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
