The data: Mastercard’s gross payment volume (GPV) grew 8% year over year (YoY) in Q4 2022, slowing from the post-lockdown 23% YoY increase from the same period in 2021, per its earnings release.
Key context: Inflation played a role in bumping up Mastercard’s volume—though it’s difficult to quantify to what extent because price increases have cooled in recent months.
Rival Visa has minimized inflation’s potential negative effects on the business—CEO Al Kelly said last year that personal consumer expenditures have historically remained strong for Visa during inflationary periods. That may also apply to Mastercard.
How we got here: Here are some other factors that may have contributed to Mastercard’s Q4 growth.
Looking ahead: Mastercard warned that revenue growth for Q1 would slow more than expected as pent-up travel demand diminishes—it anticipates percentage growth in the “high end of high single digits.” Analysts predicted Mastercard’s Q1 revenues would grow 10% YoY in a Bloomberg survey. The firm’s share price tumbled about 2% on Thursday morning after the warning.
Despite the warning, Mastercard is working on projects that can set it on a path for long-term growth—like its investments into buy now, pay later (BNPL).
Related content: Check out our US Payment Card Networks 2022 report to learn about the competitive and regulatory threats affecting card networks and the growth opportunities they have.
This article originally appeared in Insider Intelligence's Payments Innovation Briefing—a daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.