Based on the latest public data from calendar year 2022 and analysis, we estimate that the total global purchase personal consumption expenditure, or PPCE, excluding Russia and China, was approximately $40 trillion.
That is the size of the prize for the three largest payments players who all announced results recently.
Visa
“We delivered strong second quarter results with $8.8 billion in net revenue, up 10%, GAAP EPS up 12%, and non-GAAP EPS up 20%. For our key business drivers, we saw relative stability,” said Ryan McInerney, Chief Executive Officer, in the earnings call.
“Overall payments grew 8% year over year in constant dollars, US payment volume grew 6% year over year, and international payments volume grew 11%.
Cross-border volume, excluding intra-Europe, rose 16% year over year, and process transactions grew 11%. Visa’s business performance demonstrates our strategy at work in consumer payments, new flows, and value-added services.
Furthermore, across all of these growth levers, tremendous opportunity remains.
As we think about Visa’s growth, tap-to-pay and e-commerce are key drivers in the digitization of payments. This quarter, tap-to-pay grew 5 percentage points from last year to 79% of face-to-face transactions globally, excluding the U.S.
Of note, Japan nearly doubled its penetration since last year to almost 30%. In the US, in the second quarter, we’re nearing 50% penetration with New York City at over 75%, the first US city to reach this milestone, up from 50% two years ago, demonstrating the impact that transit and our focused issuance and acceptance have on accelerating growth.
On the e-commerce front, we continued to see Visa’s US e-commerce payments volume grow several points faster year over year than face-to-face spend, and the same is true in many key countries around the world, including Canada, Brazil, Australia, and India.”
Mastercard
Mastercard posted net income of $3.0 billion from a net revenue of $6.3 billion, an increase of 10%, or 11% on a currency-neutral basis, gross dollar volume was up 10% and purchase volume up 11%, on a local currency basis.
The increase was attributable to growth in its payment network and our value-added services and solutions.
Payment network net revenue increased 7%, or 8% on a currency-neutral basis.
Primary drivers of the increase were as follows:
Gross dollar volume growth of 10%, on a local currency basis, to $2.3 trillion.
Cross-border volume growth of 18% on a local currency basis.
Switched transactions growth of 13%.
“Our momentum continued this quarter, as we delivered strong revenue and earnings growth powered by healthy consumer spending, strong cross-border volume growth of 18%1 year-over-year, and new deal wins in every region,” said Michael Miebach, CEO of Mastercard.
“We are driving growth in electronic payments by scaling innovative technologies like tokenization.”
American Express
American Express Company reported Q1 net income of $2.4 billion, or $3.33 per share, compared with net income of $1.8 billion, or $2.40 per share, a year ago.
“We have started 2024 off strong, with our first-quarter results reflecting the positive trends we have seen in our business the last several years,” said Stephen J. Squeri, Chairman and Chief Executive Officer. “Revenue increased 11% from a year earlier to $15.8 billion and EPS increased 39% to $3.33.
“Our continued investments in our value propositions, marketing, brand and technology capabilities have helped drive high levels of engagement with our premium customers.
Overall, Card Member spending grew 7% on an FX-adjusted basis, with spending by US consumer Card Members up 8% from a year earlier and spending in our International Card Services segment increasing 13% on an FX-adjusted basis.
We continue to attract high-spending, high credit-quality customers to the franchise, with new card acquisitions accelerating sequentially to 3.4 million in the quarter.
Our fee-based products accounted for around 70% of the new account acquisitions we saw in the quarter, and we continue to see strong demand from Millennial and Gen Z consumers, who accounted for over 60% of new consumer account acquisitions globally.
First-quarter consolidated total revenues net of interest expense were $15.8 billion, up 11% from $14.3 billion a year ago. The increase was primarily driven by higher net interest income and increased Card Member spending. ”
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