This summary is based on the second quarter fiscal 2007 earnings call conducted by MasterCard Incorporated. (MA: chart) on August 2, 2007.

Management:
CFO: Chris McWilton
Corporate Controller: Tara Maguire
IR: Barbara Gasper

Key Investors Issues

- Net revenue increased by 18% from a year ago to $997 million.
- Net income was up 93.1% to $195 million, or $1.43 per share, excluding special items.
- Gross dollar volume was up 13.3%from a year ago, while purchase volume rose 14.8%.
- Operating expenses increased 3.2% to $725 million.
- Unsecured 10-year notes were reclassified to short-term debt.
- Share conversion period was extended to 2 October.

Second Quarter Highlights

- Net revenue rose 18% from a year ago driven by strong growth in GDV and processed transactions.
- GDV (gross dollar volume) grew 13.3% on a local currency basis and 16.4% on a U.S. dollar converted basis to $555 billion.
- Revenue yield, or net revenue for $1,000 of GDV was 18 basis points versus 17.8 basis points in the prior year due to the strength in international transaction volumes.
- Customers issued 855 million cards, up 10.7% over the cards issued in 2006.

Regions outside of the U.S. or South Asia, the Middle East, Africa and Latin America continue to grow at faster rates.

- Cross-border transaction volumes grew 17.3% from a year ago.
- Currency fluctuation contributed 2% of the revenue increase.
- Purchase volume was up 14.8% on a local currency basis and cash volume was up 9% on a local currency basis.

Operating margin improved by 10.3% to 27.3% from 17% in 2006, demonstrating the leveragability of the business model.

- Net operation fees rose by 19.1% from $117 million to $729 million driven by growth in processed transactions and authorization, settlement and switch revenue.
- Net assessments rose $34 million or 14.5% to $268 million due to strong GDV growth.
- Assessment rebates and incentives grew 12% versus last year.

Operating expenses increased 3.2% to $725 million, excluding special items as a result of higher personnel costs and professional fees.

- Advertising and marketing expenses fell by 12.6% reflecting significant World Cup sponsorship activity.
- Cash flow from operations amounting to $446 million were generated.
- A $3.4 million reserve was recorded for a litigation settlement.
- Unsecured 10-year surbodinated notes worth $80 million maturing in June 2008 were reclassified to short term debt..

Half Year 2007 Performance Highlights

- Net income was $410 million, or $3 per share, excluding the impact of special items.
- Net revenue was $1.9 billion, a 20.6% increase versus the same period in 2006.
- Operating expenses rose 5.4%, to $1.3 billion, compared to the same period in 2006.
- Investment income increased $23 million due to higher cash and short-term investment balances related to the proceeds received from the company’s IPO.

Significant business developments:

- Changes to the corporate charter were approved by shareholders at annual meeting in June.
- The initial conversion window for the Class B conversion process was extended to October 5.
- An update on the initial conversion and the share repurchase program will be provided during the third quarter.
- Contractual dispute related to sponsorship of the 2010 and 2014 World Cup soccer events was resolved resulting in $90 million in compensation.

Resources earmarked for the World Cup will be channeled towards driving marketing programming at the regional and local levels.

- Investments in Redecard, a merchant acquirer and processor in Brazil are considered favourable following agreements to restrict share sales.
- The Redecard investment will be marked-to-market and gains/losses will not be recognized in P&L until, and unless securities are disposed.

Key questions and answers from the second quarter earnings call conducted by MasterCard Inc. (MA: chart) on August 2, 2007.

Liz Grausam (Goldman Sachs): Your rebates and incentive line has been growing fairly rapidly. Could you help us understand some of the dynamics that’s affecting your rebates and incentives?

Chris McWilton: It is generally difficult to analyze rebates and incentives, but we had a large debit card conversion that took place during the second quarter last year, which is going to impact growth rates quarter-to-quarter. Do not overrely on these rebates and incentive numbers but focus on the net revenue yield basis that I talked about in the past. We are trying to drive business to our customers in a way that maximizes the profit potential of their business and make sure that we maintain that revenue yield at acceptable levels.