Mastercard said in a statement Monday (Feb. 24) that the coronavirus outbreak could hurt its revenues this year and that caused the company’s shares to dip on the news.
The company said cross-border travel and cross-border eCommerce growth were both factors hit by the coronavirus.
Mastercard anticipated its growth in the first quarter to be two or three points lower than what they previously expected. If the decline is limited only to the first quarter, Mastercard said its year-end numbers would likely be in the low end of the low teens’ range compared to the previous year.
After that announcement, Mastercard shares fell 3 percent on Monday, CNBC said.
The stock market suffered its worst sell-off in two years on Monday, after an increase in coronavirus infections outside of China caused uncertainty to spike all over again, with some fearing a worldwide economic slowdown due to the virus.
Major companies like Apple and Proctor & Gamble have lent their voices to those fears, with Apple admitting earlier in February that its numbers for growth would be sluggish compared to what they had expected, also because of the virus outbreak, which has affected Chinese factories and suppliers that are crucial to producing the iPhone.
And Goldman Sachs has said that the outbreak wouldn’t be friendly to the high rates of stocks in the U.S. and Europe as of late.
The news from Mastercard comes after better-than-usual quarter results for the company after the holidays, which saw customers spending more on its cards.
The coronavirus has sent shockwaves through the manufacturing and supply industries in China and surrounding countries, and also other international entities that do business there.
In bids to try and offset financial woes, Chinese banks have been working to loan money to afflicted companies and communities, and the government has worked with tech companies to implement systems to show who is healthy and who is not.