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How Mastercard’s Gross Dollar Volumes and Net Revenues Trended

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Mastercard’s gross dollar volumes

In the second quarter, Mastercard (MA) witnessed total gross dollar volumes (or GDV) of $1.5 trillion. Excluding the United States, the company’s GDV witnessed YoY growth of 16% mainly on the back of Asia-Pacific as well as Europe. The GDV from Europe in the second quarter was $433 billion compared to $356 billion in Q2 2017.

In addition, the European region could provide significant opportunities for Mastercard and Visa (V) in the long term primarily because of huge cash transactions. Visa’s payments volume from Europe was $428 billion in the June quarter, while in the March quarter it was $416 billion.

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Net revenues

In the second quarter, Mastercard had total net revenues amounting to $3.6 billion, reflecting a YoY increase of 18% on a currency-neutral basis. We’ll now have a look at the components of total net revenues. Domestic assessments amounted to $1.5 billion in the second quarter, reflecting an increase of 22% compared to the same quarter of the prior year.

Mastercard’s cross-border volume fees amounted to $1.2 billion in the second quarter, implying an increase of 18% compared to Q2 2017 on a currency-neutral basis. The company’s transaction processing fees and other revenues amounted to $1.8 billion and $785 million, respectively, in the June quarter. The transaction processing fees rose YoY by 20% mainly because of the service offerings and switched transactions. In the second quarter, Mastercard’s rebates and incentives were $1.7 billion.

As of July 31, 2018, Mastercard’s market capitalization is $205.4 billion, while peers (IYF) have the following market capitalizations:

  • Visa (V): $303.6 billion
  • Capital One Financial (COF): $45.6 billion
  • Discover Financial Services (DFS): $24.7 billion
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