The data: Mastercard’s gross dollar volume (GDV) increased 14% year over year (YoY) in Q2, compared with 33% YoY in the same period in 2021, per its earnings presentation.
Key context: Inflation—which reached a 40-year high in June—most likely played a role in Mastecard’s GDV growth since higher prices mean more spending on a dollar-for-dollar basis.
However, other economic factors like relatively low unemployment, high wages, and consumer savings may point to Mastercard seeing some organic GDV growth, which CEO Michael Miebach highlighted on the company’s earnings call.
How we got here: Like rival Visa, Mastercard’s cross-border volume—which increased 58% YoY—was a big growth driver in Q2.
New tie-ups and partnership renewals likely also played a role in Mastercard’s Q2 performance: Mastercard completed the conversion of Gap’s newly launched co-branded card portfolio, which was previously managed by Visa’s network. The move brought 10 million cards into Mastercard’s network.
What’s next? Mastercard is supporting acceptance of Apple’s Tap to Pay on iPhone feature, the tech giant’s software point-of-sale solution that it unveiled in February. The company is also building out its buy now, pay later (BNPL) program, Mastercard Installments, with several big-name partners including JPMorgan, HSBC, and Apple. These moves can help Mastercard sustain volume as consumers lean further into mobile wallets and continue to adopt BNPL solutions.
Miebach also highlighted three trends that present growth opportunities for Mastercard moving forward.
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