Second-quarter payment network profits among the global U.S.-based Major 4: Visa [V], Mastercard [MA], American Express [AXP] and Discover [DFS], soared 23.8% year-on-year (YOY), and now growing at an 12.80% CAGR (compound annual growth rate), based on the past five years.
The Major 4 reported a combined second-quarter (2Q/19) (after tax) profit of $7663 million, compared to $7114 million for 1Q/19 and $6190 million for 2Q/18, according to data collected by CardData.
Payment Network Profits Analysis
While, the Major 4 payment network profits posted a 68.3% YOY gain in 2017, an 18.6% decline in 2016 and 0.3% decrease in 2015, the figures are skewed by the merger of Visa and Visa Europe in 2016. Nevertheless, it is fair to say major payment network after-tax profits are growing an annual rate of 13%, according to analysis by RAM Research.
Mastercard still leads the Major 4 peer group on both YOY gains and CAGR, racking up two consecutive years of 30%+ gains and with an industry leading 21% CAGR, notes Robert McKinley, Senior Analyst for CardData, CardFlash, and CardTrak.
Visa Second-Quarter Global P/L
Visa’s global after-tax net income increased by 33.1% YOY to $3101 million for 2Q/19, compared to $2977 million for the prior quarter, and $2329 million one-year ago. Visa profits are currently growing a 16.27% CAGR. In the second-quarter of 2015, Visa reported $1697 million in after-tax profits.
Mastercard Second-Quarter Global P/L
Mastercard’s global after-tax net income rose 30.5% YOY to $2048 million for the second-quarter, compared to $1862 million for 1Q/19, and $1569 million for 2Q/18. Mastercard profits are currently growing a 20.70% CAGR. In the second-quarter of 2015, Mastercard reported $965 million in after-tax profits.
American Express Second-Quarter Global P/L
American Express global after-tax net income increased 8.5% YOY for 2Q/19 to $1761 million, from $1550 million for the prior quarter, and a $1623 million for the year ago quarter. American Express profits are currently growing a 4.57% CAGR. In the second-quarter of 2015, American Express reported $1473 million in after-tax profits.
Discover Second-Quarter Global P/L
Discover global after-tax net income increased 12.6% YOY to $753 million for the second-quarter, compared to $726 million in 1Q/19, and $669 million for 2Q/18. Discover profits are currently growing a 5.89% CAGR. In the second-quarter of 2015, Discover reported $599 million in after-tax profits.
Major 4 Global PDV
Global card PDV (purchase dollar volume) in the second-quarter (2Q/19) among the Major 4 U.S. payment networks continued to spiral down over the past year. On an FX (currency adjusted) basis, Major 4 global payment card (credit + charge + debit + prepaid) PDV declined from a 12.8% YOY (year-on-year) FX gain for 2Q/18 to a 10.2% YOY FX gain for 2Q/19. On a nominal dollars, or not currency adjusted, basis (NFX) for the second-quarter, PDV rose 5.7% YOY, compared to 14.6% one-year ago.
The Major 4 U.S.-based global networks: Visa [V]; Mastercard [MA]; American Express [AXP]; and Discover [DFS], posted $3750 billion in global PDV for 2Q/19, compared to $3497 billion in the prior quarter and $3548 billion for the year ago quarter.
Complete Second-Quarter Report on Major 4 U.S. Global Payment Card Profit/Loss [2015-2019] Available for Immediate Download
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