Investors, analysts and industry observers will parse Mastercard results on the heels of the payment giant’s earnings release Thursday morning to gain insight into the state of global consumer spending — and the state of B2B payments as well.
In terms of top and bottom lines, consensus holds that consolidated revenues should grow by a bit more than 14 percent to $3.79 billion, and earnings per share are estimated to be $1.53.
Beyond that, the earnings announcement and subsequent detail will show how gross dollar volumes are trending, where, in recent periods, that growth has been north of 10 percent. Consider the most recent quarter, where volume of transactions was up 13 percent in the third quarter of 2018, which ended in September, as measured year over year. The United States has shown a slower growth trajectory in gross dollar volume, up high single digits (again, as measured by the third quarter), where international growth rates have been in the double digits.
Management has called out cross-border dollar volume fees, which have been pacing a high teens percentage growth rate.
During the call, management will likely give at least some color commentary on the macroeconomic setting, where the trade war continues between the United States and China. It is also likely that there will be some illumination on whether rising interest rates are having an impact on consumer spending or predisposition to spend.
Digital efforts continue at Mastercard, of course, and in past management discussions from CEO Ajay Banga and CFO Martina Hund-Mejean, the firm has called out traction in mobile partnerships, such as those with FinTech Grab in Asia.
The Mastercard Track platform — facilitating global trade between enterprises — is on a phased rollout, so there may be some progress to report on this front. Overall, B2B transactions are growing as a percentage of total volume, where they had been about 11 percent in recent periods and should grow a few percentage points moving forward, against the backdrop of a $120 trillion global opportunity. Mastercard Bill Pay Exchange launched during the early part of the fourth quarter, part of Mastercard’s faster payments and mobile efforts, and may offer some contribution to quarterly results.