MasterCard Inc., the second-largest payments network, said profit fell 1.1 percent as expenses rose and a strengthening U.S. dollar hurt earnings overseas. Shares declined in early trading.

Second-quarter net income slid to $921 million, or 81 cents a share, from $931 million, or 80 cents, a year earlier when there were more shares outstanding, the Purchase, New York-based company said in a statement. Adjusted profit, which excludes some items, was 85 cents a share, matching the average estimate of 32 analysts surveyed by Bloomberg. Revenue increased less than 1 percent to $2.39 billion, falling short of analysts' estimates.

A strengthening U.S. dollar is hindering profits outside the U.S. where MasterCard gets most of its revenue, even as spending climbs. Chief Executive Officer Ajay Banga has been striking deals with retailers and increasing incentives as consumers demand better rewards for using their cards.

"Our business continues to perform well with good transaction and volume growth, particularly in cross-border, despite the mixed global economic environment and foreign exchange headwinds," Banga said in the statement.

Operating expenses rose 16 percent to $1.14 billion in the quarter. Spending on rebates and incentives climbed 21 percent, the company said in a presentation on its website. Adjusted revenue increased 7 percent and cross-border spending climbed 17 percent, the firm said. MasterCard took a $44 million charge in the quarter related to merchant litigation in the U.K.

Shares of MasterCard fell 2.2 percent to $93.11 at 8:49 a.m. in New York. The stock climbed 10 percent this year through Tuesday, trailing larger rival Visa Inc.'s 14 percent advance.

Worldwide spending on MasterCard's network rose to $1.14 trillion from a year earlier, driven by gains outside the U.S. Spending rose 7.4 percent in the U.S. The effective tax rate dropped to 25.7 percent from 32.2 percent a year earlier, according to the statement.

Visa said last week that fiscal third-quarter net income increased 25 percent to $1.7 billion as revenue rose 12 percent. American Express Co., the biggest credit-card issuer by purchases, reported second-quarter profit fell 3.7 percent as card-spending growth slowed and revenue declined.

Visa said it expects to complete discussions by October about possibly reuniting with its former subsidiary Visa Europe Ltd. While Visa acquiring its European counterpart would mean more competition over time, a deal could benefit MasterCard in the short-term, Chris Hickey, an analyst at Atlantic Equities, said before results were released.

"Visa would likely have to raise its prices post-deal and the operational integration of the two companies could be a little disruptive," Hickey said. "MasterCard would benefit, though long-term Visa Europe would make Visa a more formidable competitor."

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