Income Tax Expense (Benefit)
Effective Income Tax Rate (EITR)
Components of Deferred Tax Assets and Liabilities
Deferred Tax Assets and Liabilities, Classification
Adjustments to Financial Statements: Removal of Deferred Taxes
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Mastercard Inc., income tax expense (benefit), continuing operations

US$ in millions

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Federal	1,024)	663)	439)	642)	649)
State and local	133)	51)	56)	81)	69)
Foreign	1,296)	976)	781)	897)	871)
Current	2,453)	1,690)	1,276)	1,620)	1,589)
Federal	(661)	(31)	106)	40)	(228)
State and local	(40)	(4)	9)	—)	(11)
Foreign	50)	(35)	(42)	(47)	(5)
Deferred	(651)	(70)	73)	(7)	(244)
Income tax expense	1,802)	1,620)	1,349)	1,613)	1,345)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

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Item	Description	The company
Current	Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations.	Mastercard Inc. current increased from 2020 to 2021 and from 2021 to 2022.
Deferred	Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.	Mastercard Inc. deferred decreased from 2020 to 2021 and from 2021 to 2022.
Income tax expense	Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Mastercard Inc. income tax expense increased from 2020 to 2021 and from 2021 to 2022.

Mastercard Inc., effective income tax rate (EITR) reconciliation

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
U.S. federal statutory income tax rate	21.00%	21.00%	21.00%	21.00%	21.00%
State tax effect, net of federal benefit	0.60%	0.60%	0.70%	0.70%	0.60%
Foreign tax effect	-3.00%	-2.70%	-2.50%	-2.10%	-1.30%
Valuation allowance, U.S. foreign tax credit	-2.80%	0.00%	0.00%	0.00%	0.00%
U.S. tax expense on foreign operations	0.90%	0.60%	0.60%	0.00%	0.00%
Foreign-derived intangible income deduction	-1.10%	-0.70%	-0.60%	0.00%	0.00%
U.S. tax benefits	0.00%	-1.30%	0.00%	0.00%	0.00%
European Commission fine	0.00%	0.00%	0.00%	0.00%	2.70%
Windfall benefit	-0.60%	-0.70%	-1.50%	-1.30%	-1.00%
Other, net	0.40%	-1.10%	-0.30%	-1.40%	-3.50%
Effective income tax rate, before U.S. tax reform	15.40%	15.70%	17.40%	16.90%	18.50%
Transition Tax	0.00%	0.00%	0.00%	-0.30%	0.30%
Remeasurement of deferred taxes	0.00%	0.00%	0.00%	0.00%	-0.10%
Effective income tax rate	15.40%	15.70%	17.40%	16.60%	18.70%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

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Item	Description	The company
Effective income tax rate, before U.S. tax reform	Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Mastercard Inc. effective income tax rate, before U.S. tax reform decreased from 2020 to 2021 and from 2021 to 2022.

Mastercard Inc., components of deferred tax assets and liabilities

US$ in millions

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Accrued liabilities	697)	497)	324)	354)	297)
Compensation and benefits	316)	260)	218)	214)	210)
State taxes and other credits	43)	40)	47)	41)	30)
Net operating losses	156)	136)	147)	119)	104)
U.S. foreign tax credits	274)	333)	276)	145)	—)
Property, plant and equipment	52)	—)	—)	—)	—)
Intangible assets	186)	206)	182)	157)	170)
Other items	162)	161)	200)	94)	115)
Deferred tax assets, gross	1,886)	1,633)	1,394)	1,124)	926)
Valuation allowance	(114)	(415)	(353)	(205)	(94)
Deferred tax assets, net	1,772)	1,218)	1,041)	919)	832)
Prepaid expenses and other accruals	(186)	(114)	(78)	(83)	(89)
Gains on equity investments	(132)	(153)	(60)	—)	—)
Goodwill and intangible assets	(561)	(571)	(216)	(187)	(125)
Property, plant and equipment	—)	(174)	(183)	(128)	(97)
Other items	(135)	(115)	(99)	(63)	(18)
Deferred tax liabilities	(1,014)	(1,127)	(636)	(461)	(329)
Net deferred tax assets (liabilities)	758)	91)	405)	458)	503)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

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Item	Description	The company
Deferred tax assets, gross	Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Mastercard Inc. deferred tax assets, gross increased from 2020 to 2021 and from 2021 to 2022.
Deferred tax assets, net	Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Mastercard Inc. deferred tax assets, net increased from 2020 to 2021 and from 2021 to 2022.
Net deferred tax assets (liabilities)	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting.	Mastercard Inc. net deferred tax assets (liabilities) decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.

Mastercard Inc., deferred tax assets and liabilities, classification

US$ in millions

		Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
	Deferred tax assets	1,151)	486)	491)	543)	570)
	Deferred tax liabilities	393)	395)	86)	85)	67)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

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Item	Description	The company
Deferred tax assets	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent.	Mastercard Inc. deferred tax assets decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.
Deferred tax liabilities	Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent.	Mastercard Inc. deferred tax liabilities increased from 2020 to 2021 but then slightly decreased from 2021 to 2022.

Mastercard Inc., adjustments to financial statements

US$ in millions

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Adjustment to Total Assets
Total assets (as reported)	38,724)	37,669)	33,584)	29,236)	24,860)
Less: Noncurrent deferred tax assets, net	1,151)	486)	491)	543)	570)
Total assets (adjusted)	37,573)	37,183)	33,093)	28,693)	24,290)
Adjustment to Total Liabilities
Total liabilities (as reported)	32,347)	30,257)	27,067)	23,245)	19,371)
Less: Noncurrent deferred tax liabilities, net	393)	395)	86)	85)	67)
Total liabilities (adjusted)	31,954)	29,862)	26,981)	23,160)	19,304)
Adjustment to Total Mastercard Incorporated Stockholders’ Equity
Total Mastercard Incorporated stockholders’ equity (as reported)	6,298)	7,312)	6,391)	5,893)	5,395)
Less: Net deferred tax assets (liabilities)	758)	91)	405)	458)	503)
Total Mastercard Incorporated stockholders’ equity (adjusted)	5,540)	7,221)	5,986)	5,435)	4,892)
Adjustment to Net Income
Net income (as reported)	9,930)	8,687)	6,411)	8,118)	5,859)
Add: Deferred income tax expense (benefit)	(651)	(70)	73)	(7)	(244)
Net income (adjusted)	9,279)	8,617)	6,484)	8,111)	5,615)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

Mastercard Inc., Financial Data: Reported vs. Adjusted

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Mastercard Inc., adjusted financial ratios

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net Profit Margin
Reported net profit margin	44.66%	46.00%	41.90%	48.08%	39.19%
Adjusted net profit margin	41.73%	45.63%	42.38%	48.04%	37.56%
Total Asset Turnover
Reported total asset turnover	0.57	0.50	0.46	0.58	0.60
Adjusted total asset turnover	0.59	0.51	0.46	0.59	0.62
Financial Leverage
Reported financial leverage	6.15	5.15	5.25	4.96	4.61
Adjusted financial leverage	6.78	5.15	5.53	5.28	4.97
Return on Equity (ROE)
Reported ROE	157.67%	118.80%	100.31%	137.76%	108.60%
Adjusted ROE	167.49%	119.33%	108.32%	149.24%	114.78%
Return on Assets (ROA)
Reported ROA	25.64%	23.06%	19.09%	27.77%	23.57%
Adjusted ROA	24.70%	23.17%	19.59%	28.27%	23.12%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Mastercard Inc. adjusted net profit margin ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Mastercard Inc. adjusted total asset turnover ratio improved from 2020 to 2021 and from 2021 to 2022.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Mastercard Inc. adjusted financial leverage ratio decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Mastercard Inc. adjusted ROE improved from 2020 to 2021 and from 2021 to 2022.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Mastercard Inc. adjusted ROA improved from 2020 to 2021 and from 2021 to 2022.

Mastercard Inc., Financial Ratios: Reported vs. Adjusted

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	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	9,930)	8,687)	6,411)	8,118)	5,859)
Net revenue	22,237)	18,884)	15,301)	16,883)	14,950)
Profitability Ratio
Net profit margin¹	44.66%	46.00%	41.90%	48.08%	39.19%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income	9,279)	8,617)	6,484)	8,111)	5,615)
Net revenue	22,237)	18,884)	15,301)	16,883)	14,950)
Profitability Ratio
Adjusted net profit margin²	41.73%	45.63%	42.38%	48.04%	37.56%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ Net profit margin = 100 × Net income ÷ Net revenue
= 100 × 9,930 ÷ 22,237 = 44.66%

² Adjusted net profit margin = 100 × Adjusted net income ÷ Net revenue
= 100 × 9,279 ÷ 22,237 = 41.73%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Mastercard Inc. adjusted net profit margin ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022.

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net revenue	22,237)	18,884)	15,301)	16,883)	14,950)
Total assets	38,724)	37,669)	33,584)	29,236)	24,860)
Activity Ratio
Total asset turnover¹	0.57	0.50	0.46	0.58	0.60
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Net revenue	22,237)	18,884)	15,301)	16,883)	14,950)
Adjusted total assets	37,573)	37,183)	33,093)	28,693)	24,290)
Activity Ratio
Adjusted total asset turnover²	0.59	0.51	0.46	0.59	0.62

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ Total asset turnover = Net revenue ÷ Total assets
= 22,237 ÷ 38,724 = 0.57

² Adjusted total asset turnover = Net revenue ÷ Adjusted total assets
= 22,237 ÷ 37,573 = 0.59

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Mastercard Inc. adjusted total asset turnover ratio improved from 2020 to 2021 and from 2021 to 2022.

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Total assets	38,724)	37,669)	33,584)	29,236)	24,860)
Total Mastercard Incorporated stockholders’ equity	6,298)	7,312)	6,391)	5,893)	5,395)
Solvency Ratio
Financial leverage¹	6.15	5.15	5.25	4.96	4.61
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets	37,573)	37,183)	33,093)	28,693)	24,290)
Adjusted total Mastercard Incorporated stockholders’ equity	5,540)	7,221)	5,986)	5,435)	4,892)
Solvency Ratio
Adjusted financial leverage²	6.78	5.15	5.53	5.28	4.97

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ Financial leverage = Total assets ÷ Total Mastercard Incorporated stockholders’ equity
= 38,724 ÷ 6,298 = 6.15

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Mastercard Incorporated stockholders’ equity
= 37,573 ÷ 5,540 = 6.78

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Mastercard Inc. adjusted financial leverage ratio decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	9,930)	8,687)	6,411)	8,118)	5,859)
Total Mastercard Incorporated stockholders’ equity	6,298)	7,312)	6,391)	5,893)	5,395)
Profitability Ratio
ROE¹	157.67%	118.80%	100.31%	137.76%	108.60%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income	9,279)	8,617)	6,484)	8,111)	5,615)
Adjusted total Mastercard Incorporated stockholders’ equity	5,540)	7,221)	5,986)	5,435)	4,892)
Profitability Ratio
Adjusted ROE²	167.49%	119.33%	108.32%	149.24%	114.78%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ ROE = 100 × Net income ÷ Total Mastercard Incorporated stockholders’ equity
= 100 × 9,930 ÷ 6,298 = 157.67%

² Adjusted ROE = 100 × Adjusted net income ÷ Adjusted total Mastercard Incorporated stockholders’ equity
= 100 × 9,279 ÷ 5,540 = 167.49%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Mastercard Inc. adjusted ROE improved from 2020 to 2021 and from 2021 to 2022.

	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	9,930)	8,687)	6,411)	8,118)	5,859)
Total assets	38,724)	37,669)	33,584)	29,236)	24,860)
Profitability Ratio
ROA¹	25.64%	23.06%	19.09%	27.77%	23.57%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income	9,279)	8,617)	6,484)	8,111)	5,615)
Adjusted total assets	37,573)	37,183)	33,093)	28,693)	24,290)
Profitability Ratio
Adjusted ROA²	24.70%	23.17%	19.59%	28.27%	23.12%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

¹ ROA = 100 × Net income ÷ Total assets
= 100 × 9,930 ÷ 38,724 = 25.64%

² Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 9,279 ÷ 37,573 = 24.70%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Mastercard Inc. adjusted ROA improved from 2020 to 2021 and from 2021 to 2022.

Mastercard Inc. (NYSE:MA)

Analysis of Income Taxes

Income Tax Expense (Benefit)

Effective Income Tax Rate (EITR)

Components of Deferred Tax Assets and Liabilities

Deferred Tax Assets and Liabilities, Classification

Adjustments to Financial Statements: Removal of Deferred Taxes

Mastercard Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Mastercard Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)